Enterprise And Entrepreneurship Flashcards
Why new business ideas come about
New business ideas often come about due to changes in technology, changes in consumer demand, and the obsolescence of products and services
New business ideas emerge as entrepreneurs recognise opportunities created by changes in the market
Successful businesses can identify these opportunities and develop innovative solutions that meet the changing needs of customers
How new business ideas come about
New business ideas can come about through original ideas or by adapting existing products, services, or ideas.
The key to business success is identifying a need or opportunity in the market and developing an innovative solution that meets the needs of customers in a unique and valuable way.
Original ideas
Original ideas are new and unique concepts that are not based on existing products/services, or ideas.
They often arise when entrepreneurs identify a gap in the market or a new need that has not yet been met.
Original ideas can be based on a new technology, a new market, or a unique perspective on an existing problem.
Adapted ideas
Adapting existing products, services, or ideas involves taking an existing concept and making it better or more suitable for a different market or customer base.
This approach often involves identifying a problem with an existing product or service and developing a solution that addresses the problem.
Advances in technology
Advances in technology can create new opportunities for businesses to develop innovative products and services.
Changes in customer wants
Consumer demand often changes over time, creating opportunities for businesses to develop new products and services that meet these changing needs.
Obsolete product or service
Products and services can become outdated due to changes in technology or changes in consumer demand.
This can create opportunities for businesses to develop new products and services that meet the needs of consumers in new and innovative ways
Risks of business activity
Business failure
Financial loss
Lack of security
Business failure
Business failure affects businesses of all sizes and is a risk to both new and established businesses.
It occurs when a business is unable to meet its financial obligations or when it cannot generate enough revenue to sustain its operations.
The impact of business failure can be devastating, resulting in job losses, bankruptcy, and financial ruin for the owners and investors.
Financial loss
This occurs due to factors such as poor financial management, economic downturns, or unexpected events such as natural disasters.
The impact of financial loss can be severe, resulting in reduced profitability, reduced competitiveness, and reduced ability to invest in growth.
Lack of security
This is a risk that businesses face in terms of data security, intellectual property theft, or physical security.
A security breach can result in reputational damage, legal liability, and the loss of customer trust.
Rewards of business activity
Business success
Profit
Independence
Business success
This is the ultimate reward that business owners strive for.
It occurs when a business meets or exceeds its objectives, such as generating revenue, achieving profitability, or expanding its operations.
Profit
Profit is a measure of the success of a business.
Profit enables businesses to reinvest in growth opportunities, pay dividends to shareholders, and provide financial stability to the business.
Independence
Independence allows businesses to make their own decisions rather than being subject to the demands of external stakeholders such as investors or creditors.
