Topic 1.1 - Enterprise & Entrepreneurship Flashcards
Who is an entrepreneur?
Someone who creates a business, taking on financial risks with the aim of making a profit from the business
Where do new business ideas come from?
- Changes in what consumers want
- Advances in technology
- Products and services becoming obsolete
What does it mean for a product to become obsolete?
The product is out of date or not used anymore
What is E-commerce?
Using the internet to carry out business transactions
What is M-commerce?
Using mobile technologies such as smartphones and tablets to carry out business transactions
What are some examples of changes in technology?
- Making expensive technology affordable
- Social Media
- E-commerce and M-commerce
What is a payment platform?
A platform that allows businesses to take online payment from customers.
( Usually free for customer but take a small commission form seller)
What are the advantages of using E-commerce and M-commerce?
- Allows businesses to trade with customers around the world
- Entrepreneurs don’t have to rent a physical building to start their business ( they can take it straight to the market place)
- Helps generate new business ideas
What impact does Social Media have on a business?
- Can help promote a business/ attract customers
- Encourages customers to talk about a businesses product/services
How can a business keep up to date with changing trends in society?
- Ask customers for feedback (Questionnaires, Surveys etc.)
- Trial new products
- Can use data to identify customer wants and needs
How do products and services become obsolete?
- Advances in Technology (Older tech is replaced etc.)
- Changes in fashion or taste
Give 2 ways in which an entrepreneur comes up with new business ideas
- Adapt an existing product or service to keep up with changes in consumer trends
- Create a completely original product or service to satisfy a new or previously unknown customer trend
How can you adapt an existing product or service?
- Adapting the promotion strategy of a particular product or service
- Changing the product’s brand name
- Responding to new fashions trends
Why might a business decide to adapt one of it’s existing products?
- It can cut the cost of development
- Can make it quicker to launch ‘new’ products
- Their target market may be changing
What is the definition of a company?
A business with a separate legal identity that is owned by shareholders
Who are shareholders?
The owners of a company
Why do people go into business?
- To gain money
- They see a problem and can find a solution to it
- They see a gap in the market
How can a business develop competitive advantage?
- Have a better product than other businesses
- Give it’s customers better service
- Come up with an idea or a product that is unique
What does the term ‘Blue sky thinking’ mean?
A technique of creative thinking where participants are encouraged to think of as many ideas as possible about an issue or problem
What are the main risks an entrepreneur takes when they start up a new business?
- Business failure
- Financial Loss
- Lack of security
What is a revenue forecast?
A prediction of future revenue based on expected sales
Why do businesses fail?
- They have a problem with their cash flow
- Unexpected drop in sales revenue
Why might sales revenue drop?
- Recession
- Behaviour of suppliers
- Competition
What is cash flow?
The amount of money going in and out of a business
What type of risks can lead to financial loss?
- Competitive risks
- Technical risks
- Financial risks
What is an ‘Investment’?
Putting money into a business with the intention of making a profit
What is intuition and why is it used?
- Intuition is like a ‘gut’ feeling
- Entrepreneurs use It as it is quick and it proves a judgement created by our feelings
What are the rewards of setting up your own business?
- Becoming Wealthy
- The excitement
- The control/ Independence
Who is a stakeholder?
Anyone who has interests in the business activities
What is the purpose of business activities?
- To produce goods and services
- To meet customer needs
- To add value
How can a business meet customer needs?
- Have a positive relationship with them
- Friendly and helpful customer service
- Reasonable prices
How can you add value to a product?
- Branding
- Convenience
- Quality and design
- USP
What are the advantages of branding?
- Creates customer loyalty
- It’s a way of defining a business’s aims and values
How can you make a product or service convenient?
- Excellent customer service
- Easy to pay for
- Great customer experience
How is quality and design adding value to a product/service?
- Quality can show customers that they can depend on the business
- A well designed product or website can encourage consumers to buy from that business
- If a product looks attractive, more people are likely to pay a higher price for it
What is USP + Give examples of it?
- A USP makes a product stand out from it’s competitors
- Examples: Price, Quality, Being first to market
What is the role of an entrepreneur?
- Organise Resources
- Make business decisions
- Take risks: Financial and Business decisions
