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| Question | Answer |
| Business Unit 1 | :) |
| Businesses What is a business? | A business is an organisation whose purpose is to produce goods and services to meet the needs of customers. |
| What things do you need to think about when setting up a business? | How will the business be financed What is required to get it up and running? What products will be sold? |
| What is a supplier? | A business that sells (supplies) products to another business |
| What is production? | Using raw materials, labour, and machinery to make products |
| Define what a customer is? | A person or organisation that buys the product or service |
| What is a consumer? | The person that uses (consumes) the product |
| Primary research? | Collecting data that did not exist before |
| Examples of primary research? | Surveys Focus groups Observations Questionnaires |
| Secondary research? | Collecting data that already exists |
| Examples of Secondary research? | Internet research Books Local newspapers Sales data |
| What can market research tell a business? | What features customers want How much they are willing to pay Where they shop Who the main competitors are |
| Advantages of Primary research? | More accurate Up to date Specific to needs Effective to collecting qualitative data Direct customer contact |
| Advantages of Secondary research? | More general Less time consuming Effective at collecting quantitative data |
| Qualitative data? | Information about opinions, judgement's and attitudes |
| Quantitative data? | Data that can be expressed as numbers and statistically analysed |
| Market mapping? | Helps businesses to identify market segments and position their products through identifying gaps in the market |
| Market segments? | A group of buyers with similar characteristics and buying Splitting up the market in different categories |
| What ways can a market be segmented? | Age Gender Income Lifestyle Life-stage |
| What are the benefits of market segmentation? | Meets specific customer needs Differentiate their products focus on a specific group of people Target marketing actively |
| Market map? | A diagram an used to position and compare products in a market and identify opportunities where customer needs are not being met |
| Ways to compete? | Wider product range Higher quality Better product features Stronger brand image |
| Branding? | A brand is a named product that customers see as being different from other products and they can associate or identify with. A company or product can develop a unique brand image that customers associate them with |
| Added value? | It is the increased worth that a business creates for a product it is the difference between what a business pays its suppliers and the price that it is able to charge for the product |
| Ways to add value? | Unique selling point Branding Better design Greater speed of service |
| The importance of added value? | The higher the added value the sooner the costs can be paid off, so its quicker for the business to make profit. More chance of survival Long term growth |
| USP? | A USP is another way to add value to a product. A USP will also help a business compete |
| Franchise? | It is the right given by one business to other businesses to sell goods or services using its name. The business that buy into franchise remain independent businesses |
| What do franchise get when buying into business? | The established brand name Training Equipment Access to goods and services |
| Benefits of franchise? | Higher chance of survival Brand image and reputation established Tried and tested products Specific support and training provided |
| Drawbacks of a franchise? | Start up costs expensive Lack of control Limited flexibility |
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