BUSINESS STUDIES TOPIC 1 BUSINESS REPORT

• Blossom Cosmetics


  Well established cosmetics manufacturer based in Australia that produces cosmetics for the consumer market
• Blossom Cosmetics


  • Rapid growth
  • Heightened demand
  • Considering expanding overseas
• Cosmetics industry is highly competitive
• Blossom Cosmetics


  Attempting to shift its legal structure to a private company
• Report objectives


  1. Outline the impact of technology on Blossom Cosmetics

  2. Discuss the legal structure of setting up a private company

  3. Explain the benefits and challenges of operating at the growth stage and maturity stage so that Blossom Cosmetics can expand successfully
• Technology and technological influence

  • Advanced devices that improve production efficiency
  • Increase productivity
  • Reduce business' reliance on expensive human labour
  • Allow for cheap mass production of higher-quality cosmetics with fewer human errors and defects
• Blossom Cosmetics expands overseas


  It will benefit from technological developments as it will make importing and exporting its cosmetics easier
• Platforms such as Zoom, email, and messages


  Allow smooth communication between countries, reducing international barriers and promoting customer satisfaction
• Blossom Cosmetics gains a competitive advantage over its local and foreign competitors


  By overcoming the monopolistic competition of its markets
• The influence of advanced technology

  Requires Blossom Cosmetics to constantly adapt to the ever-changing world of technology, which may disrupt the current processes of the business, thus disrupting efficiency
• Private company


  An incorporated business with private ownership, consisting of 2-50 shareholders
• Advantages of private company

  • Limited liability
  • Personal selection of shareholders
• Limited liability


  The business will operate as a separate legal entity to its owners/shareholders, therefore the owners of Blossom Cosmetics are not to be held personally liable by its shareholders or accused of full financial responsibility
• Shareholder confidence


  Likely to increase by taking a cautious approach towards expanding into foreign markets
• Shareholders


  May be more willing to invest in Blossom Cosmetics, knowing that they won't have to personally bear the financial burden if the expansion fails
• Advantages of private company

  • 2-50 shareholders can be personally selected
  • Ownership of Blossom Cosmetics becomes more diluted
  • Owners can privately select the most productive and talented experts in the global market to assist in expanding and meeting demand
• These shareholders


  Can majorly assist in Blossom Cosmetics' investment in foreign technology, assisting in the business' cosmetics advancement and production which their local competitors will be unable to replicate, satisfying customers and boosting profit and allowing Blossom Cosmetics to remain in the growth stage
• Disadvantages of private company

  • Shared ownership can lead to a dilution of both profits and control among shareholders, which can be demotivating and result in decreased productivity
  • Distributing control among a group of individuals can lead to conflicts and disagreements making it difficult for Blossom Cosmetics to respond quickly to challenges in global markets
  • The legal responsibilities and obligations of a private company differentiate entirely from a partnership as the addition of shareholders requires a lot more work to be put in place
• Growth stage


  The business life cycle stage where a company experiences increased sales, profitability, and demand
• Blossom Cosmetics is currently in the growth stage
• Challenges in the growth stage


  • Meeting demand and constantly innovating its product line, particularly as it expands into new markets
  • Sustaining growth by continuously innovating their cosmetic line, especially as it expands overseas and taps into new competitive markets
  • Diversifying and differentiating their cosmetic line products from competitors puts pressure on the business and meeting potential new customers' standards is both time-consuming and expensive
  • If Blossom Cosmetics does not introduce new products regularly and meet their potential customer satisfaction will begin to decline, ultimately leading to lower sales and profitability, furthermore, Blossom Cosmetics will fail to remain in the growth stage, diminishing its prosperity
  • Local and foreign competitors may replicate Blossom Cosmetics' products and design and inflict issues onto Blossom Cosmetics' ease of entry into the global market
• Maturity stage


  The business life cycle stage where sales and profits may begin to decline, plateau, or stabilise
• Challenges in the maturity stage

  • Potential loss of customers due to issues such as a lack of appeal in existing cosmetic products and outdated strategies
  • Reevaluating current strategies, potentially by innovating or releasing new products to regain customer interest and stimulate sales growth
  • Attracting new customers may prove challenging, resulting in stagnant sales and minimal profit improvement
  • Loss of business funds may hinder Blossom Cosmetics' ability to innovate its cosmetic products and strategies, expand its operations, and compete effectively in the market
• In response to challenges like competition

  Blossom Cosmetics should consider strategic moves like mergers or acquisitions to maintain its growth and avoid entering the maturity stage
• Merging with or acquiring competitors


  Can effectively eliminate competition and position Blossom Cosmetics as a dominant player in the market
• Such moves


  Facilitate Blossom Cosmetics' entry into global markets by claiming the existing consumer base of the acquired businesses
• To remain relevant and continue growing

  Blossom Cosmetics must embrace technological advancements and innovative product processes in its cosmetic range
• Implementing technologies like computer-aided manufacturing


  Ensures efficient and high-quality production, meeting the increasing global demand as Blossom Cosmetics expands internationally
• Using AI programs for communication, packaging design, and trend forecasting


  Helps Blossom Cosmetics stay ahead of market trends and consumer preferences, driving continuous growth
• Investing in technology-driven advertising, including platforms like TikTok and influencer marketing


  Helps Blossom Cosmetics maintain its mainstream presence and attract customers globally
• Based on the report, it is recommended that Blossom Cosmetics:
• Technology in production


  • Improves efficiency
  • Reduces errors in cosmetics manufacturing
• Technological advancements


  • Facilitate easier importing and exporting of cosmetics
  • Communication platforms like Zoom and email aid in international business operations
• Adapting to evolving technology

  Requires constant adjustments and employee training
• Investing in expensive technology


  Can disrupt current processes and efficiency
• Limited liability


  Protects owners from personal financial responsibility
• Selection of shareholders


  • Allows for expertise and investment in the business
  • Increased shareholder confidence can lead to more investments
  • Dilution of ownership allows for selection of talented experts
  • Shareholders can assist in technological advancements and global expansion
• Shared ownership


  • Can lead to profit dilution and control conflicts
  • Legal responsibilities increase with the addition of shareholders
  • Financial struggles may arise
  • Control distribution can result in challenges responding to global market changes
  • Compliance with international regulations can be time-consuming and tedious
• Continuous innovation


  Essential to meet demand and sustain growth
• Diversifying product lines


  Puts pressure on meeting customer standards