1.1 Enterprise and Entrepreneurship Flashcards
What is a business enterprise?
A business enterprise is a process of identifying new business opportunities and then taking advantage of them. It can involve starting up a new business or helping an existing one to expand by coming up with new ideas.
what purposes can a business activity have?
- Provide people with a good or a service.
- Meeting the customer needs.
- Add value to an existing product.
what does it mean by providing people with a good or a service?
Provide people with a good (a physical item such as a book or furniture) or a service (an action performed by other people to aid the customer, such as hairdressing or plumbing).
What does it mean by meeting the customer needs?
This means providing goods and services that people will want to buy. Customer needs often change so firms may need to change the products they sell to keep up.
what does it mean by adding value to an existing product?
This means a business finds a way to improve a product, so customers are willing to pay more for it compared to competitors’ products. There are several ways a business can add value to a product.
For example: Making a product more convenient, building a good brand image, improving the product’s design or quality, give the product a unique selling point.
What is an entrepreneur?
An entrepreneur is someone who takes on the risks of enterprise activity.
what must an entrepreneur be able to do in order to run a new business?
1) Organise resources
2) Take risks
3) Make business decisions
what are the risks involved in running a new business?
1) Financial loss
2) Not having much security when starting up.
3) They had to give up their own job
4) The business can fail so there is a risk that the entrepreneur could end up losing all of the money, effort, and time they put into the business.
what rewards can the entrepreneur achieve if the business succeeds?
1) Seeing their business idea become a success could motivate them to keep the business running.
2) If the business makes a lot of profit the entrepreneur will earn more money than their previous job.
3) Independence to choose what they do day to day and what direction the business goes in.
what is the name of the short-term finance?
Trade credit
What are the two types of data that a business can collect during market research?
Quantitative and Qualitative data.
what is quantitative data?
Quantitative data is anything you can measure or reduce to a number.
What is qualitative data?
Qualitative information is all about people’s feelings and opinions.
What is market segmentation?
Market segmentation is when people within a market are divided into different groups.
How will market segmentation help a business?
It can allow the business to identify its target market so then the business can aim its product at a specific group of people which will lead to an increase in sales of the business.
