8 - Uncertainty , Risk, Reward And Change

Question 0

Ways in which businesses change practice in order to be successful

Answer 0

• change of ownership allows them to be successful
• a sole trader could become a partnership as other investors are included into the business
• small businesses are often bought by bigger businesses
• business might change in activity in order to be successful. A business might expand from the primary sector to secondary and tertiary

Question 1

Reasons why business environments are uncertain

Answer 1

• always changing in order to be successful
• changes in economy - leave consumers with less money to spend on goods .
• or large disposable income therefore increases sales and demand for goods or service
• Tastes and fashions make consumers demand for products with greater technology

Question 2

What are the consequences not of making changes/taking risks

Answer 2

• businesses can lose market share if they do not take risks. E.g a competitor has a new product, so more customers will buy that
• when the economy is in a down turn they should not sit back, they should still take risks to attract customers who have less to spend.
  As some businesses have done well in down turns.
• taking risks that pay off could enable a business to reap large rewards.