Theme 1: Topic 1.2 - Spotting a Business Opportunity Flashcards
What can a market be?
A place
A product
A group of people
What do most business face?
Competition
What affects the competition between businesses?
Price Customer Service Quality Product Range Location
Why does price affect competition?
Customer want to pay less for a given product
Why does customer service affect competition?
Offering customer service can attract customer and may mean the customers will be willing to pay more money for a product
Why does quality affect competition?
Offering better quality products may mean that customers are more satisfied
Why does product range affect competition?
Having a large range of products may make a business more attractive to customers as they may be able to shop all in one place (convenience)
Why does location affect competition?
Customers may be more likely to buy from a business if it sells products in a convenient place as they won’t have the inconvenience of travelling or waiting for the product
State and explain the level of competition you think that a shop selling clothes on a local high street would face
High competition because there’s likely to be lots of shops selling clothes on a local high street
Give two ways in which a business selling poor quality goods may be able to stay competitive
It could sell its products at a lower price than its competitors
It could sell its products in a convenient location for customers
It could offer customer service
It could increase the size of its product range
Why do businesses carry out market research?
To find out about the market and how they’re performing in it
What is the market size?
The number of individuals within the market which are potential buyers or sellers of products
What is the market share?
The proportion of total sales within the market that is controlled by the business
What is market research used to understand?
Customers
Give examples of customer needs
The type of product
The quality of product
The price of product
The choice of products
