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Unit 5 definitions
Section 1 and 2
Question | Answer |
---|---|
The internal sources of business ideas for individuals | personality, skills, interests, experiences, ages, business preference, unexpected occurrences, brainstorming |
Define market research | collection of all data needed to develop a new product or change an existing one. It is gathering and analysing information |
Product screening | selecting the most promising idea from the list of ideas for detailed investigation and market research |
Feasibility study | preliminary investigation into the profit potential of a product/service - how much it will cost, sales, production etc |
Prototype | sample product manufactured on an experimental basis to see if the design idea works in practice and appeals to consumers. |
Concept development | turning the idea into a precise product concept or description that will appeal to customers and be different from rival products. |
Business Plan | document setting out who is setting up the enterprise, what is the product/service, how it is going to be produced and promoted, where it is going to be sold and where the finance is coming from |
batch production | manufacturing a limited number of identical goods at the same time. Each stage of production will be completed for all goods before the goods move to the next stage. |
mass production | continuous production of large quantities of identical goods. It is usually automated and requires semi skilled or unskilled labour |
List the short term sources of finance | accrued expenses, bank overdraft, factoring, trade credit, tax |
List the medium term sources of finance | term loan, leasing, hire purchase |
List the long term sources of finance | equity, grants, long term loan (debenture), venture capital, retained earnings, sale and leaseback |
Factors to consider before choosing finance | cost, purpose, amount, control, collateral, risk |