Business (dynamic nature-customer needs)

• What does the dynamic nature of business refer to?


  Constantly adapting to meet customers' wants and needs
• What is venture capital?


  Money invested in a business that is seen as having potential growth
• What are the reasons new business ideas come about?

  • Changes in technology
  • Changes in what consumers want
  • Products and services becoming obsolete
• How do new business ideas typically come about?


  • Original ideas
  • Adapting existing products/service ideas
• What does adapting existing products/services involve?


  Finding new products based on the original one and changing them for different customers
• Why is adapting existing products/services an attractive business proposition?


  It usually requires less research and development and is cheaper
• What is a potential challenge when launching an adapted product?


  It is easy to underestimate how hard it is to find new products that people love
• How can launching an adapted product benefit a business?


  It can successfully protect the main product
• What are the components of risk in business?


  Business failure, financial loss, lack of security
• What are the components of reward in business?


  Business success, profit, independence
• What does business failure refer to?


  The collapse of a business, possibly leading to closure
• What does independence mean for business owners?


  The need for business owners to make their own decisions and be their own boss
• What does lack of financial security imply for business owners?


  Uncertainty about family income and assets
• What is the concept of risk and reward in business?


  The balance between the worst and best that can happen
• What are the indicators of business success?


  • Personal satisfaction
  • Excellent products/services
  • Growth
  • Awards and recognitions
• How is profit calculated?

  Profit = Total Revenue - Total Cost
• What are common reasons for business failures?

  • Poor cash flow
  • Fall in sale revenue
  • Action of competitors
• Why do many business owners value independence?


  They prefer working for themselves over working for others
• What does financial loss mean for a business owner?


  An owner may lose the capital they invest in
• What are the roles and purposes of business enterprises?


  • To produce goods or services
  • To meet customer needs
  • To add value: convenience, branding, quality, design, unique selling point (USP)
• What is the role of an entrepreneur?


  An entrepreneur organizes resources, makes business decisions, and takes risks
• What is a business/enterprise?


  A person or organization that produces goods and services to meet customer needs
• What does adding value mean in business?


  The difference between the cost of producing a product/service and the price a customer is willing to pay
• What are the ways to add value to a product/service?


  • More convenience
  • Unique selling point
  • Better design
  • Improved quality
  • Branding
  • Greater speed of service
• What is an entrepreneur defined as?


  A risk taker who wants to create an organization to make a difference
• What are the benefits of entrepreneurship to an economy?


  • They can bring new jobs
  • They take risks, being creative and using initiatives
  • Entrepreneurs develop businesses and hire and organize the factors of production
• What are the roles of entrepreneurs?


  • Creating products/services to meet customer needs
  • Creating jobs
  • Paying tax to the government
  • Generating economic activities through customer spending
  • Exporting goods abroad
• What is invention?


  Making something entirely new that did not exist
• What is innovation?


  Making a significant contribution to something that has already been invented
• Why is it important for a business to identify customer needs?


  • To attract new customers
  • For repeat purchases/repetitive customers
• What does durable mean?


  Something that lasts long and doesn't get damaged quickly
• What are the key customer needs to identify and understand?


  • Price
  • Quality
  • Choice
  • Convenience
• What are the benefits of identifying and understanding customer needs for a business?


  • Generating sales
  • Business survival