Revision notes, Production, finance and external influence on business with case study







What people bring to a company

Competency:  unique things that someone

Chloe and Ade are Entrepreneurs; she had one business, but didn’t give up and started again. 


Saw an opportunity and a GAP IN THE MARKET.  Had knowledge of spices from university, and always experimented in other restaurant.   Ade bought the factory experience and production line experience.    They bought at a time when property prices were low; bought specialist machinery, doesn’t say if it was old or know.  Initially the point of the business would be to survive; but once they had the celebrity endorsement then they would receive larger orders.  USP would be the heat sealed pouches.  They have massive endorsements from supermarkets, retails, wholesalers and internet. 


How raw materials are turned into outputs which become final product

Transformation – where inputs are turned into outputs, e.g. flour and water to bread


Job Production – a one off, made to measure


Batch Production – Same machinery used to produce different batches


Flow Production – product assembled on production line


Process production – product made through a process, like baking


Division of Labour – dividing work force up to specialize in a task


Specialization – worker concentrates on a task

Purchases raw spices, roast and blend them into blends; 



Job Production:  sometimes a small quantity is bought

Batch Production:  when they buy in bulk


Division of Labour

Spice Store:  three unskilled workers

Roasting Room:  Two skilled workers

Blending room:  Two highly skilled blenders

Packaging room:  unskilled as many as 35

Finished goods:  Two unskilled

General Office:  5 full time workers


Specialization:  Roasting room and Blending room – problem some workers might become bored and undervalued

Understanding added value

A business needs to understand its competition, and know its strength and weakness and offer a USP, or provide better value for money than its rivals

Competition:  All business operate in an environment where they face competition


Business need a USP – Unique Selling Pont


Competition can come from local, internet, another town, other brands


Customers always have a choice


Businesses compete by adding value to a product

Other spices Schwartz, or supermarket own brands (cheaper), internet is competition, wholesalers


USP:  Gourmet spices, attracted and enforced by chefs – fresher, posh, heat sealed, fresher, packaging attractive.  Chloe comes up with new ideas like the Moroccan spice blend.  BLEND IS THE USP


How are they adding value?  Roasting them, blending them, coming up with new ideas, NEW PRODUCT DEVELOPMENT;  new types of packaging, trying to make them as fresh as possible, making products to order, celebrity endorsement


Increase efficiency with new technology

New Technology improves efficiency, can have drawbacks for workers if they have to learn new skills, which can make them unhappy


Specialization:  Worker used for specific job


Division of Labour – dividing the work force


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