BUSINESS STUDIES REVISION POWERPOINT Created By; Joe McNeillie

HERE ARE SOME REASONS FOR STARTING A BUSINESS:   Lost previous job   Redundancy money   Want to be your own boss   Skills to be put to better use   Experience to be put to better use   Good idea   Think you can make a better earning   Desire to make a profit   Lost previous job

REASONS WHY A BUSINESS MAY FAIL;   Expected sales low   Lower income earned   Miscalculated costs   Failed to keep costs under control   Insufficient cash   Lack of skills and experience   Charging wrong price   Product not meeting customer needs   Lack of staff members   Too risky  Lack of money for growth  Badly run  More competition  Products / services better or cheaper elsewhere  Old technology  The business does not move on and reinvent itself

ENTERPRISE AND ENTREPRENEURS  Enterprise is; The formation of a new business or development of a new product or service to be introduced to the market.  Entrepreneurs are; A person having generated a new business idea(s) develops it by setting up a business. Often viewed as someone who is willing to take risk(s) in setting up a new business.

PETER JONES RULES / QUALITIES OF AN ENTREPRENEUR:  Vision, motivation, action, timing, results orientated, confidence, influence, care, committed, intuition, perseverance/persistence.

KYLE MACDONALD  Kyle Macdonald set out on a quest to trade 1 red paperclip for a house; he set up a website to get publicity and made 16 trades over one year to get a house. He swapped a paperclip for a pen, for a doorknob, for a camping stove. A town in America eventually bought a house and traded it with Kyle to get publicity. The other things that Kyle swapped included a second hand van, a recording contact, rent for one year and a paid part in a film which is what Kyle swapped for a house.

CHARACTERISTICS OF AN ENTREPRENEUR;  Opportunity spotter  Risk-taker  Decision maker  Creative thinker  Self-motivator  Strong communicator

WHY DO BUSINESSES EXIST?  (To produce goods - To make profit business To distribute products To provide a service)  (To help others - Not for profit / social enterprise business To meet the needs of society)

SOURCES OF BUSINESS IDEAS  Personal Experience  Business experience  Market research  Eureka moment  Brain Storming

EXAM ALERT  Question; Explain two ways an entrepreneur can generate Business ideas? (4 marks)  Answer; An entrepreneur can generate business ideas from business experience as you could have worked in a field of business and seen a flaw, gap in the market or niche. Also you could generate ideas from Eureka moments as you could suddenly find a new idea / solution to a problem.

MARKET SEGMENTATION  Geographic location is linked to income and areas of prosperity, e.g. you probably wouldn't put a Bentley garage in Kirkham but you might do in London.  Physiographic focuses on the impact of factors such as your personality, lifestyle, values, social class and attitudes.  Behavioural when you buy, your usage rate and brand loyalty – do you always stick with one brand?  What makes people go back to the same hairdressers or car dealerships?  They go back as they are influenced by brand/company loyalty. Also they may offer a good service at the right price that is reliable and is easy for the customer to use the service.

COMPETITION GOOD AND BAD POINTS:  Gives the company something to compare products against  Learn from mistakes made by your competition  Motivation to be better and beat your competition  Encourages innovation  Improved quality of products  Lower prices of products

USP – UNIQUE SELLING POINT  USP – Unique selling point adds value to a product and sets it apart from its

Why do businesses use market research? < BLANK ? BLANK To advertise To sell goods and services To identify customer needs