Enterprise and entrepreneurship

Why do many businesses exist?

To meet a specific need or fill a gap in the market

Why might an entrepreneur start a business?

Because there is demand for the goods or services they can provide

What is a dynamic market?

A market in a rapidly changing business environment

What must a business understand to be dynamic?

The market in which it operates

What can business ideas come from?

Changes in technology, changes in consumer wants, obsolescence, new ideas, and adapting existing ones

What is e-commerce?

Business transactions using the internet

What is B2C e-commerce?

Businesses selling to consumers

What is B2B e-commerce?

Businesses selling to other businesses

What is m-commerce?

Business transactions through a mobile device

How do businesses increase m-commerce use?

By developing their own mobile apps

What has social media allowed businesses to do?

Interact with customers in more ways

How does social media help create brand awareness?

It provides a simple, cheap and effective marketing method

How can clothes retailers use social media?

To get feedback and offer exclusive promotions

What can businesses do to promote products via social media?

Pay other businesses, celebrities or influencers to share product photos

Why is social media promotion popular with businesses?

It’s cheaper than traditional advertising and reaches the target market easily

What are demographics?

The characteristics that make up a population or customer base

How do businesses use demographics?

To decide the target market for a product or service

How can demographic changes impact consumer wants?

They can create new opportunities, like targeting older consumers

Why must businesses be aware of changing customer tastes?

Because trends and preferences change regularly

What does obsolete mean?

Out of date

What replaces obsolete products?

New or updated products

What is the product life cycle?

The limited lifespan of a product

What happens when a product reaches the end of its life cycle?

It is replaced by an updated or different product

What does invention mean?

Creating something that did not previously exist

What is innovation?

The successful commercialisation of an invention or improving a product over time

What is adaptation in business?

Changing an existing product or service for different customers

Why is adaptation often seen as less risky?

Because it changes existing products rather than launching brand new ones

What are types of adaptation?

Changing a product’s brand name, format, or promotion strategies

What does every business decision involve?

An element of risk

What must an entrepreneur be willing to do?

Take risks

What types of risk can business activity expose an entrepreneur to?

Financial loss, lack of security, business failure

Is risk avoidable in business?

No, but it can be minimised with planning

How can entrepreneurs minimise risk?

By doing market research, writing a business plan, and having enough money

What might the rewards of starting a business include?

Profit, business success, independence

What makes a business successful?

Meeting the needs of its customers

How do businesses try to meet customer needs?

By producing goods and services

What are goods?

Tangible items that can be used and stored

What are services?

Intangible actions that cannot be stored

What must businesses organise to make decisions?

Resources and risk levels

What decisions does an entrepreneur make?

What to produce or provide using available resources

What are the main business resources?

Land, labour, capital and enterprise

What is land in business terms?

Naturally occurring resources like land and water

What is labour in business terms?

Human effort, skills and knowledge

What is capital in business terms?

Equipment and money used to provide goods and services

What is enterprise?

The willingness to take risks, make decisions and organise resources

What increases a business’s chances of survival and profit?

Providing customers with what they want

Why is knowing what customers want important?

Because it helps businesses meet their needs and stay competitive

What is added value?

The difference between the selling price and the cost price of a product or service

How does convenience add value?

By saving customers time and making products easier to use

How does branding add value?

By encouraging trust in a product, making customers willing to pay more

How does quality add value?

By making customers willing to pay more for better products

How does design add value?

Through appealing features or presentation

What is a unique selling point?

Something that makes a product or service stand out from the competition