1.1.1 The dynamic nature of business

Question 1

What is a product?

Answer 1

A product is anything that is capable of satisfying customer needs.
Physical products:
Cars
Washing machines
X box consoles
Mobile phones

Question 2

What is a service?

Answer 2

A service is an act that a business person carries out for you in exchange for money,
for example:
Dental treatment
Accountancy
Travel agents
Gardening
Cleaning
Hairdresser

Question 3

Changes in technology: Amazon

Answer 3

Since the invention of the Internet in 1990 businesses have found a new cheaper way to reach the consumer, by selling online
This is called e-commerce

Question 4

Changes in technology: eBay

Answer 4

Small businesses are now able to set up and sell virtually anything online due to websites such as eBay, etsy and ebid

Question 5

Changes in technology: Stadia

Answer 5

New technology innovation means there are lots of new products on the gaming market

Question 6

Changes in technology: robotics

Answer 6

Advancements in robotics will mean dozens of new products in the future. Can you think of any task in your day that could be completed by a robot?

Question 7

wants and needs

Answer 7

want: luxury
need: essential

Question 8

Wants and needs: Social media

Answer 8

Businesses can use social media to find out what consumers want and need so that they can produce products and services to meet those wants and needs

Question 9

Wants and needs: ready meals

Answer 9

We are all working more and have less time, so the ready meal market is catering to these consumer needs

Question 10

Wants and needs: “Free from” foods

Answer 10

Consumers are also demanding organic, free range, sustainable, eco friendly products as we become more aware of our impact on the environment

Question 11

Change in tastes and trends

Answer 11

Consumer tastes change over time which means that a business is at risk if they don’t keep up with current trends.

Question 12

Definition: Obsolete

Answer 12

. Obsolete means a product that is no longer used or out of date

. For example we can make a product obsolete by replacing it with something better

Question 13

Obsolete services

Answer 13

Some services are no longer required because of changes in technology or new inventions

Question 14

Definition: Original ideas

Answer 14

Original ideas are ones that have not been used before to put a product or service into production e.g. pet hotels

.This may be to solve problems
. It may be because an entrepreneur has a passion or interest
. A gap in the market may have been spotted
. A business may have carried out some research into the wants and needs of shoppers and be creating products to meet those needs

Question 15

Original ideas – solve problems

Answer 15

This is Art Fry – he invented the post-it note by accident
. Originally it was called the press and peel
. It was yellow as he had yellow paper to hand
. He invented it to keep the page open in his hymn book

Question 16

Original ideas – gap in the market

Answer 16

A successful business will be one that spots an opportunity to make a profit
. This could be an idea that no-one has thought of before – for example Trunki luggage
. The opportunity could be where there are lots of businesses already making a healthy profit
. The entrepreneur may also spot an opportunity to trade and also make a difference to society – this is called a social enterprise

Question 17

Original ideas – carried out research

Answer 17

Vet Joe Inglis and 7 friends realised that there were 8.5 million dogs in the UK and 4 out of 5 owners treat the pet as one of the family and want the best food possible
They created a niche business which makes tailored food to the dog’s age, breed or medical condition and is delivered to their door customer
Now TAILS.COM have 40,000 UK

Question 18

Adapting existing ideas

Answer 18

A business could create a new product by:

Mix and match
New version of an old product
Cheaper version of an old product