Business Studies Unit(s) 1 (Some of it!)

Business Studies Unit(s) 1 (Some of it!)

1. Businesses

   • A business is an organisation whose purpose is to produce goods and services to meet the needs of customers
   • A business might produce its own goods or buy them from a supplier and sell them to customers
   • A market is where buyers and sellers meet to exchange goods and services

2. Understanding customer Needs

   • Most customer needs are based on good quality, good product range, convenient location, good customer service and a fair price. The problem is that customers are all different and have different needs and expectations
   • Market research can be categorised into two sections: Primary research (Collecting data that did not exist before) and Secondary Research (Collecting data that already exists) e.g. Internet Research

3. Market Mapping

   • Market mapping helps businesses to identify market segments and position their products through identifying gaps in the market
   • Businesses must research potential customers' buying preferences, i.e who the customers are, what they want , what they buy and how often they buy. This can be done through:
   • finding information about customers
   • Using their own experience
   • Looking at existing businesses and trying competitors' produts
   • Observation and Surveys

4. Competition

   • A business might use a number of criteria to analyse and judge the strengths and weaknesses of its potential competition in order to improve its 'business offering' and differentiate from them
   • Branding: A brand is a named product that customers see as being different from other products, and that they can associate or identify with. A Company or product can develop a unique brand image that customers associate them with

5. Added Value

   • Added value 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
   • A business can add value to its products by lowering costs or adding something that will make customers willing to pay a higher price
   • The added value of a product goes towards paying off a company's costs. the higher the added value, the sooner costs can be paid off and the quicker a business will make a profit. The more value a business can add to its products, the more chance of long term growth and survival

6. Enterprise

   • Enterprise is a word often used in business, which represents the ideas and initiatives involved in starting a new business. Businesses might supply a good (Physical and tangible product such as a car) or a service (a non physical, intangible product
   • Enterprise - The initial spark and idea for a business and the willingness by an individual to show initiative, take a risk and undertake a new venture