Business topic 1.1.1 - .3

• How does dynamic nature contribute to businesses?

  Dynamic nature allows new business ideas to come about.
• Why do new business ideas come about?

  Technology - Change in technology lead to new products.

  Changes in consumer wants - Customer wants can change causing businesses to come up with ideas to satisfy these wants.

  Products & services becoming obsolete - Technological advances cause certain products to become obsolete leading to new ideas.
• How do new business ideas come about?

  Original ideas:

  Never thought before ideas very different from the current market. E.g. Electric cars

  Adapting existing products/services:

  New ideas allow changes to current products to enhance them in a way no one has thought before. New technology allows these adaptations to become possible.

  E.g. Dyson adapted the design of the vacuum cleaner to improve its function.
• What is risk and reward?

  Risk - when a business does not succeed for a number of reasons.

  Reward - when a business succeeds and benefits from financial or emotional reward.
• What are examples of risks to a business?

  Failure - consumers may not want to buy their product

  Financial loss - A lot of investment is required to start up a business so failure means large financial loss.

  Lack of Security - Entrepreneurs lose their job to start a business so if no profit is made they have no money to live off.
• What are examples of rewards to a business?

  Financial - if the business is successful it produces profit. Also in the future the business could be sold for a large sum of money.

  Own boss - more flexible as the entrepreneur can choose their work.

  Pursue an interest - entrepreneurs may want to start a business based on what their passionate about.
• What purpose do businesses serve?

  To produce goods & services to meet customer wants and needs
• What is the difference between goods & services?

  Goods are tangible whereas services are intangible
• What is the difference between customers' wants and needs?

  Needs are things people cannot live without unlike wants which are products they don't need but would like to have.
• What are the five ways of adding value to a business?

  Quality - durability of product

  USP - quality of product that's not offered by similar products

  Convenience - focus on usefulness to consumers

  Branding - distinctive logo/image

  Design - product design may be superior to existing products
• what are some roles of entrepreneurship?

  Organised - staying on top of tasks such as accounting, marketing, sales to be successful and run the business.

  Identify business opportunities - being able to make critical decisions that impact the direction and success of a business

  Willingness to take risks - not taking risks may lead to the business not succeeding.