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Business > U5 Ch.19 Ideas > Flashcards

U5 Ch.19 Ideas Flashcards

1
Q

Internal sources for entrepreneurs

A

-Hobbies. -Unexpected occurrence. -Frustration with problem. -Skills+Knowledge

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2
Q

Internal sources for existing businesses

A

-Brainstorming. -Intrapreneurship. -R&D

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3
Q

External sources for Entrepreneurs

A

-Family/Friends. -Networking

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4
Q

External Sources for existing businesses

A

-Copy Competitors. -Customer Feedback

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5
Q

External Sources for both

A

-media.
-trends.
-state agencies.
-import substitution

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6
Q

Import substitution

A

making a product domestically that is currently imported from foreign countries

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7
Q

Intrapreneurship ideas

A

from employees through suggestion schemes or suggestion boxes. Can be encouraged with bonuses for good ideas

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8
Q

Brainstorming

A

people from different areas of business cone together and creatively think of new ideas. Some rejected some considered

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9
Q

Reasons for market research

A

-find size.
-identify competition.
-find needs/wants.
-identify trends

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10
Q

Types of market research

A

-Primary(field) research. -Secondary(desk) research

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11
Q

Primary Research

A

go into marketplace gather first-hand info by making direct contact with potential customers

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12
Q

Forms of primary research

A

1.Observation. 2.Consumer Panels(Focus Groups). 3.Surveys. 4. Mystery Shoppers

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13
Q

Consumer Panels

A

consumers meet and discuss firm’s products

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14
Q

Mystery Shoppers

A

Anonymous shoppers evaluate customer service

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15
Q

Secondary Research

A

gathering + reviewing existing info that has already been collected by others

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16
Q

Forms of secondary research

A

1.Business Reports. 2.Government Publications. 3.Internet. 4. Commercial Research Agencies. 5.Media

17
Q

Benefits of market research

A

-identify target.
-lower costs.
-Evaluate advertising.
-forecast future trends.
-identify problems

18
Q

Development Process

A

1.Idea Generation -> 2.Product Screening -> 3.Concept Development -> 4.Feasibility Study -> 5.Prototype Development -> 6.Test Marketing -> 7.Product Launch

19
Q

Idea Generation

A

can come from internal and external sources

20
Q

Product Screening

A

ideas vetted and those deemed impractical are dropped. Those most likely to be successful are chosen for further development

21
Q

Concept Development

A

idea put together into product for consumers needs/wants. Needs clear USP to distinguish itself

22
Q

Feasability Study

A

examines whether product is commercially viable and investigates its profitability. Investigates multiple areas of feasibility:
-Market(Demand?).
-Financial(Cost?).
-Production(can it be made?).
-Skills(Does business have skills?)

23
Q

Prototype development

A

creation of first working model to determine areas for improvement a new model is then made and it becomes a cycle until product is satisfactory and full production begins

24
Q

Test marketing

A

sold to section of market to gather reactions and consider further changes

25
Q

Launch

A

product sold into full market and full-scale production starts. Pricing and distribution channels established. Marketing campaign needed to raise consumer awareness

26
Q

Break-Even Point

A

FC/Contribution per unit

27
Q

Contribution per unit

A

selling price p.u. - variable cost p.u.

28
Q

Fixed costs

A

don’t change with level of production

29
Q

Variable costs

A

change directly with level of production

30
Q

Margin of safety

A

difference between forecast output(Sales) and break even point. Shows how far sales can fall before break-even point reached and business begins to lose money

31
Q

Margin of safety formula

A

Forecast Output(Sales) - BEP

32
Q

BEP in euros

A

BEP x selling price p.u.

33
Q

Steps for BEP chart

A

1.Label 2.FC 3.TR 4.TC 5.Label BEP 6.Label Profit at forecast 7.Label MOS

34
Q

Limitations of break-even

A
  1. assumes all manafactured products will be sold.
  2. Assumes selling price remains the same.
  3. doesn’t account for cost of faulty stock.
  4. Doesnt consider change in price can change sales.
  5. Doesn’t consider economies of scale reducing variable cost
35
Q

Economies of scale

A

variable cost per unit decreases because production increases

Business (8 decks)

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