GCSE Edexcel Business

1.1 What are some reasons why new business ideas come around?

Changes in technology, changes in consumer wants, and products becoming obselete.

1.1 How can changes in technology affect business ideas?

Technology can lead to new business ideas. (e.g. Netflix taking over the streaming industry killing blockbuster)

1.1 How do changes in consumer wants affect business ideas?

Changes in trends and lifestyle, such as fashion trends, can lead to new business ideas.

1.1 What does it mean when a product becomes obsolete, and how does this affect a business?

Obsolete means outdated or no longer in use, creating opportunities for new products to replace them.

1.1 What are the two main ways new business ideas come about?

Original ideas (inventions) and adapting existing ideas (innovation).

1.1 What is the difference between invention and innovation?

Invention is creating a new idea; innovation is adapting and improving an existing one to meet market needs.

1.1 What are some ways to come up with new business ideas?

Brainstorming, observation, and market research.

1.1 What are some of the risks associated with starting a business?

Business failure, financial loss, and lack of security.

1.1 What are some of the rewards of starting a business?

Business success, financial gain, independence, and control.

1.1 What are the main reasons why businesses exist?

To provide goods and services, meet customer needs, and add value.

1.1 What is the difference between goods and services?

Goods are physical items, while services involve paying someone to do something with no physical good involved.

1 .1 What does the term ‘adding value’ mean in the context of business?

Adding value is what a business does to justify the increased selling price of a product or service.

1.1 Give some examples of how a business can add value?

Providing convenience, branding, quality, design, and having a unique selling point.

1.1 What is a unique selling point?

Something that makes a product stand out from its competitors.

1.1 What is an entrepreneur?

Someone who demonstrates enterprise (Ability to take risks) and shows initiative.

1.1 What roles do entrepreneurs typically play in a small business?

Making decisions, taking risks and organizing resources.

1.1 What kind of resources do entrepreneurs organize?

Physical resources, (materials, production) and human resources (staff).

1.2 What are some customer needs?

Price, convenience, choice and quality.

1.2 How does competition affect product improvement?

Competition can force businesses to improve their products to avoid being left behind.

1.2 Why is understanding customer needs important?

To attract new customers and retain repeat customers, leading to sales and business survival.

1.2 What are the two main types of market research?

Primary and secondary research.

1.2 What is primary research?

First hand research conducted by the business itself.

1.2 Give some examples of some primary research methods.

Surveys, focus groups, and observation.

1.2 What is secondary research?

Second hand research that has already been carried out by another business or organization.

1.2 What are some sources of secondary research?

The internet, market reports, and government reports.

1.2 What are some potential drawbacks of using secondary research?

It may lack specific links to the business, be out of date, or have questionable legitimacy.

1.2 What are the two types of data you can get from market research?

Qualitative, (words and thoughts and quantitative (numerical statistical data).

1.2 What are some things to consider when conducting market research?

Sample size and research bias.

1.2 What is market segmentation?

Splitting the population into smaller sections based on certain characteristics.

1.2 What is the niche market?

Targeting a smaller section of the market.

1.2 What is a mass market?

Targeting a bigger segment of the population.

1.2 Name some criteria used for a identifying market segments.

Location, demographics lifestyle, and income.

1.2 What is a market map used for?

To identify and place competitors and identify potential gaps in the market.

1.2 Why should you be careful about targeting a gap in the market?

Some gaps exist for a reason (e.g. low quality, high price).

1.2 What is the SWOT analysis?

An analysis of a business’s strengths, weaknesses, opportunities, and threats.

1.2 How does competition impact decision-making?

Businesses often base their decisions on what their competitors are doing (e.g. pricing, innovation)

1.2 How is innovation driven by competition?

If a business doesn’t improve, competitors will steal their customers.