Introduction to Small       Businesses- Understanding Customer Needs- Market Mapping- Analysing competitor strengths and w...
Types of purchases             Limited Routine             decisionpurchases            purchasesExtensive             Imp...
Market research• Finding out what the customer wants  - who is the target market?  - who are they?  - what are they doing?...
Advantages             DisadvantagesSecondary   Information is already Information may be            available            ...
Market segmentation• Businesses sell to market segments which  consist of consumers who buy similar  products• These then ...
Market Mapping• Is the tool to see how a market is segmented• Helps spot a gap in the market
CompetitiveAdvantages
Added Value• The increase in the benefits of a good or a  service which are created at each stage of  production• This mea...
Calculating Added Value• The value added at each stage of production is  calculated by the formula:Value Added = Value of ...
FranchisesA Franchise is when a large company allows smaller businesses to use their name Franchisor • Allows the use of t...
Advantages of Running a         Disadvantages of runningFranchise                       a FranchiseThere is a good chance ...
Location, Location, Location• Choosing where to locate a business is vital• There are numbers of factors to consider     W...
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Chapter 1 spotting a business opportunity

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Chapter 1 spotting a business opportunity

  1. 1. Introduction to Small Businesses- Understanding Customer Needs- Market Mapping- Analysing competitor strengths and weaknesses- Added Value- Starting up a new business
  2. 2. Types of purchases Limited Routine decisionpurchases purchasesExtensive Impulse decision purchasespurchases
  3. 3. Market research• Finding out what the customer wants - who is the target market? - who are they? - what are they doing? - what are our competitors doing? - How can we do things better?• Secondary research: Information that has already been collected before• Primary research: Information that is newly created
  4. 4. Advantages DisadvantagesSecondary Information is already Information may be available out of dateResearch It is cheap Can be difficult to make sense of Can find out what Information may not competitors are doing be relevantPrimary Obtain information Can be expensive that you wantResearch Information is up to Can take long to date obtain Competitors will not Difficult to obtain have the information
  5. 5. Market segmentation• Businesses sell to market segments which consist of consumers who buy similar products• These then become the target market Regional/ Gender Age geographical Socio- Lifestyle economic groups
  6. 6. Market Mapping• Is the tool to see how a market is segmented• Helps spot a gap in the market
  7. 7. CompetitiveAdvantages
  8. 8. Added Value• The increase in the benefits of a good or a service which are created at each stage of production• This means value can be added simply by making a product more appealing to customersChanging rawmaterials into branding products of use
  9. 9. Calculating Added Value• The value added at each stage of production is calculated by the formula:Value Added = Value of Output - Value of Input
  10. 10. FranchisesA Franchise is when a large company allows smaller businesses to use their name Franchisor • Allows the use of their business name for an agreed length of time Franchisee • Must provide the money to start their business • Must make regular payment to the franchisor
  11. 11. Advantages of Running a Disadvantages of runningFranchise a FranchiseThere is a good chance of Franchise can be removedsuccessIt’s easier to borrow money Franchisee cannot make all thebecause of proven success decisionsMost problems would have Cannot sell the franchisebeen already overcome without permissionAdvertising is organised and Have to make royalty paymentspaid for by the franchisor to the franchisorFranchisees are usually small so Supplies have to be purchasedcan pay attention to detail from the franchisor which may be expensive
  12. 12. Location, Location, Location• Choosing where to locate a business is vital• There are numbers of factors to consider Where the Transport Links suppliers are Where the Availability of competitors are workers Where the Government help customers are Cost and History and availability of tradition premises

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