Review Questions Flashcards
Distinguish between Customers and Competitors
Customers are the people who buy a business’s goods or use its services, expecting high quality at competitive prices, whereas competitors are the other businesses or individuals who offer rival, or competing, goods or services to the ones offered by the business.
Outline The Influence That Customers Have on Businesses
Businesses must respond to the needs of customers, making sure that the right product is delivered at the right time. High levels of customer service will result in improved customer satisfaction.
In what ways do customers affect business planning?
Consumers are astute and informed. They are increasingly prepared to research before purchasing or seek compensation if they believe they have either been unfairly treated or purchased a product that did not perform as promised. For these reasons, business owners need to plan to produce high-quality products.
Describe how a business can deal with the actions of competitors
Businesses need to be aware of existing competitors, but they also have to monitor the environment for potential newcomers. Businesses can respond to any change in the actions of competitors by altering their practices. For example, the launch of Virgin Blue airline caused Qantas to significantly alter its operation. Competition can also be reduced through the takeover of a competitor.
