Starting A Business Flashcards
Why are businesses setup?
- profit
- satisfaction
- demand
What is a primary business?
Extracting raw materials
What is a secondary business?
Turning raw materials into manufactured goods
What is a tertiary business?
A service selling finished goods to customers
Where do business ideas come from?
- gaps in the market
- other businesses
- personal experiences
How do businesses look for gaps in the market?
- market research/ trends
- identifying issues with other products
What is a franchise?
Where a franchisor sells the rights to use their brand name to a franchisee
Advantages for franchisor…
- grows business
- receive royalty payments
Advantages for franchisee….
- franchisor pays for stock and training
- instant good reputation
Disadvantages for franchisor….
- has to train employees and provide stock
- could ruin brand reputation
Disadvantages for franchisee…
- pays royalty payments
- don’t have control of business
What is niche marketing?
Targeting good or service at minority of market with specific needs and wants
What is mass marketing?
Targeting good or service at a majority of the market with similar needs and wants
