Topic 1.1 - Enterprise & Entrepreneurship

Question 1

Who is an entrepreneur?

Answer 1

Someone who creates a business, taking on financial risks with the aim of making a profit from the business

Question 2

Where do new business ideas come from?

Answer 2

• Changes in what consumers want
• Advances in technology
• Products and services becoming obsolete

Question 3

What does it mean for a product to become obsolete?

Answer 3

The product is out of date or not used anymore

Question 4

What is E-commerce?

Answer 4

Using the internet to carry out business transactions

Question 5

What is M-commerce?

Answer 5

Using mobile technologies such as smartphones and tablets to carry out business transactions

Question 6

What are some examples of changes in technology?

Answer 6

• Making expensive technology affordable
• Social Media
• E-commerce and M-commerce

Question 7

What is a payment platform?

Answer 7

A platform that allows businesses to take online payment from customers.
( Usually free for customer but take a small commission form seller)

Question 8

What are the advantages of using E-commerce and M-commerce?

Answer 8

• 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

Question 9

What impact does Social Media have on a business?

Answer 9

• Can help promote a business/ attract customers

- Encourages customers to talk about a businesses product/services

Question 10

How can a business keep up to date with changing trends in society?

Answer 10

• Ask customers for feedback (Questionnaires, Surveys etc.)
• Trial new products
• Can use data to identify customer wants and needs

Question 11

How do products and services become obsolete?

Answer 11

• Advances in Technology (Older tech is replaced etc.)

- Changes in fashion or taste

Question 12

Give 2 ways in which an entrepreneur comes up with new business ideas

Answer 12

• 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

Question 13

How can you adapt an existing product or service?

Answer 13

• Adapting the promotion strategy of a particular product or service
• Changing the product’s brand name
• Responding to new fashions trends

Question 14

Why might a business decide to adapt one of it’s existing products?

Answer 14

• It can cut the cost of development
• Can make it quicker to launch ‘new’ products
• Their target market may be changing

Question 15

What is the definition of a company?

Answer 15

A business with a separate legal identity that is owned by shareholders

Question 16

Who are shareholders?

Answer 16

The owners of a company

Question 17

Why do people go into business?

Answer 17

• To gain money
• They see a problem and can find a solution to it
• They see a gap in the market

Question 18

How can a business develop competitive advantage?

Answer 18

• Have a better product than other businesses
• Give it’s customers better service
• Come up with an idea or a product that is unique

Question 19

What does the term ‘Blue sky thinking’ mean?

Answer 19

A technique of creative thinking where participants are encouraged to think of as many ideas as possible about an issue or problem

Question 20

What are the main risks an entrepreneur takes when they start up a new business?

Answer 20

• Business failure
• Financial Loss
• Lack of security

Question 21

What is a revenue forecast?

Answer 21

A prediction of future revenue based on expected sales

Question 22

Why do businesses fail?

Answer 22

• They have a problem with their cash flow

- Unexpected drop in sales revenue

Question 23

Why might sales revenue drop?

Answer 23

• Recession
• Behaviour of suppliers
• Competition

Question 24

What is cash flow?

Answer 24

The amount of money going in and out of a business

Question 25

What type of risks can lead to financial loss?

Answer 25

• Competitive risks
• Technical risks
• Financial risks

Question 26

What is an ‘Investment’?

Answer 26

Putting money into a business with the intention of making a profit

Question 27

What is intuition and why is it used?

Answer 27

• Intuition is like a ‘gut’ feeling

- Entrepreneurs use It as it is quick and it proves a judgement created by our feelings

Question 28

What are the rewards of setting up your own business?

Answer 28

• Becoming Wealthy
• The excitement
• The control/ Independence

Question 29

Who is a stakeholder?

Answer 29

Anyone who has interests in the business activities

Question 30

What is the purpose of business activities?

Answer 30

• To produce goods and services
• To meet customer needs
• To add value

Question 31

How can a business meet customer needs?

Answer 31

• Have a positive relationship with them
• Friendly and helpful customer service
• Reasonable prices

Question 32

How can you add value to a product?

Answer 32

• Branding
• Convenience
• Quality and design
• USP

Question 33

What are the advantages of branding?

Answer 33

• Creates customer loyalty

- It’s a way of defining a business’s aims and values

Question 34

How can you make a product or service convenient?

Answer 34

• Excellent customer service
• Easy to pay for
• Great customer experience

Question 35

How is quality and design adding value to a product/service?

Answer 35

• 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

Question 36

What is USP + Give examples of it?

Answer 36

• A USP makes a product stand out from it’s competitors

- Examples: Price, Quality, Being first to market

Question 37

What is the role of an entrepreneur?

Answer 37

• Organise Resources
• Make business decisions
• Take risks: Financial and Business decisions