Topic 1.1: What Is a Business?

Business

An organization or entity that produces and distributes products (goods and/or services)

Goods

Tangible products

Services

Intangible products, work done for the customer

Customer

The individual or business who purchases a product

Consumer

The individual who uses a product (may or may not be the buyer)

Problem, need, or want

A specific gap, requirement, or desire a customer has that a business can address together, these define a market opportunity

Market opportunity

An unsolved customer problem, need, or want that a business can serve

Problem-solution fit

When a business’s product successfully addresses a specific customer problem

Value

The worth or benefit a product gives the customer

Value creation

When a business provides a product that responds to a customer’s problem, need, or want

Value capture

When a business charges customers a price higher than the cost to produce the product

Any size

Businesses can be _______—measured by geographic reach, number of employees, or revenue

Virtually

Businesses can serve customers face-to-face or _______________

Everyone

Businesses cannot satisfy _____________. They must SELECT which problems and customers to focus on.

Focused

____________ businesses can deliver a better solution to a specific group

Selection

_____________ is the foundation of every other business decision (marketing, pricing, supply chain, etc)