Buisiness 1.1

Good (Product)

Physical items that businesses produce to sell to customers eg Heinz Baked Beanz. (Tangible).

Service

Non-physical items provided by businesses eg a hair cut

Customer Needs

The things that are essential for customers and are difficult to live without eg food

Customer Wants

Non-essential products that customers desire rather than need.

Customer

a person or business to whom goods or services are sold

Consumer

The person who uses the product or service

Demand

The quantity customers are willing to buy at any given price.

Technology Changes

Improvements in technology that allow new products to be developed

eCommerce

Using the Internet to do business eg www.amazon.com

mCommerce

Using mobile technologies to do business eg amazon app on a phone

Social Media

Websites and apps that allow people to interact online. Can be very useful for marketing and advertising.

Payment Platforms

These allow businesses to take online payments from customers. They are free for customers to use but the seller will need to pay a fee.

Demographics

This relates to the breakdown of the population eg age

Obsolete

When a product or service becomes out of date or not used anymore.

Adapting existing products

Where a business looks at their current range and updates it to suit customer demand.

Original Ideas

Where a business looks to discover a completely new way of satisfying customer needs and wants. Technology can help with the development of this eg robots delivering Amazon stock to the packing area.

Competitive Advantage

When your business is in a favourable position compared to the competition. Customers will pick you due to this.

Risk

The chance of loss of money or damage to your business from decisions.

Loss

When a business is unable to generate enough revenue to cover all its costs. This may lead to business failure.

Lack of Security

A key risk new businesses take on. There is no guarantee of success and entrepreneurs may feel there is a lot to lose.

Reward

The benefits received from running a business. These can be financial such as profit and wealth

Profit

Where the business generates enough money to cover all the costs and a surplus is left as profit.

Independence

Being able to do things by yourself - a key reason for setting up your own business.

Calculated Risk

Where the entrepreneur weights up all the risks and rewards before making a decision.

Enterprise

Entrepreneurial activity.

Adding Value

The difference between the cost of materials to make the product/service and the selling price.

Brand

The factors that help identify a product such as the name

USP

Something that makes the product or service stand out from the competition eg brand

Customer Loyalty

When a business manages to get customers to come back to them and buy more of their products and services. Linked to repeat purchase.

Entrepreneur

Someone who is willing to take on the risks of setting up as business with the aim of making a profit

Organising Resources (Entrepreneur role)

Making sure the business has enough money to run

Making Business Decisions (Entrepreneur role)

Gathering all the information you need before any choices are made

Showing Leadership (Entrepreneur role)

Effectively managing the business and staff so that they are willing to do as you say.

Innovation

Introducing a new idea (product/service) to the market.

Inputs

the resources—such as labour

Outputs

the goods