Professional Documents
Culture Documents
Entrepreneurship Notes 1
Entrepreneurship Notes 1
Economies of scale are cost advantages that • Do you know why modern retail is taking
companies experience when production away the business from small retail outlets?
becomes efficient. This happens because It is because these modern retail
costs are spread over a larger number of companies have huge bargaining
goods. Companies can achieve economies of power due to bulk buying.
scale by increasing production and lowering Hence they are crushing the small
costs'. There are two types of economies of retailers.
scale: Modern retailers will have huge
bargaining power due to which a
1. Internal Economies of Scale: These small retailer can consider them as a
originate within a company due to changes huge problem when establishing his
in how the company functions or produces own business.
goods.
Threat of Substitute Social
Goods/Services • The social impact on an industry refers to
• The industry is always competing with trends among people and includes things
another industry in producing a similar such as population growth, demographics
substitute product. (age, gender, etc), and trends in behavior
• all firms in an industry have potential such as health, fashion, and social
competitors from other industries. movements.
• This takes a toll on their profitability Technological
because they are unable to charge • The technological aspect of PEST analysis
exorbitant prices. incorporates factors such as advancements
• Substitutes can take two forms: and developments that change the way a
Products with the same business operates and the ways in which
function/quality but lesser price, or people live their lives (ie. advent of the
Products of the same price but of internet).
better quality or providing more
utility. SWOT Analysis
20 Types of Customer
Requirements
1. Price
The price of a product or service can affect
customers' purchasing decisions, as each
customer has unique budget allowances
or constraints. They may compare prices
between competitors to determine which
Customers are, first and foremost, the
offers the best deal or decide whether they
lifeblood of every company; without
are willing to pay for quality versus
them, there would be no business.
convenience. Companies must understand
Businesses must use every effort to attract their customers to set the right price or
and retain customers since they are the discounts. However, these companies must
source of the income required for survival also price their product or services high
and expansion. enough to ensure they make money.
PROMOTION
What is PROMOTION in Marketing Mix?
3. Sales Promotion
Is a marketing strategy where the product is
promoted using short-term attractive initiatives
TARGET
to stimulate its demand and increase its sales.
MARKET
This strategy is usually brought to use in the
following cases such as to introduce new
products, sell out existing inventories, attract
more customers, and to lift sales temporarily.
4. Personal Selling
Is a method where companies send their agents
to the consumer to sell the products personally. PEOPLE
It is where businesses use people (the "sales
force") to sell the product after meeting face- - This includes everyone who is involved in the
to-face with the customer. product or service whether directly or indirectly.
Great examples include cars, office equipment
(e.g. photocopiers) and many products that are
sold by businesses to other industrial
customers.
Examples:
FUNCTIONS/PURPOSE OF PACKAGING
Lux, print
1. To protect the product from damage.
advertisement
Product packaging not only protects the product
(1916) positioned
during transit from the manufacturer to the retailer,
the soap as a
but it also prevents damage while the product sits
gentle product for
on retail shelves.
washing delicate
2. Packaging Facilitates Purchase Decision. clothing
Information contained on a package may push the
Within the prestige
reader to buy the product without ever having to
vehicle category,
speak to a store clerk.
Volvo positions
3. Packaging can differentiate one brand itself as a car
of product from another brand. Packaging offering superior
helps consumers to identify the product as it sits safety and
among the competition’s products on store performance
shelves.
J & J Baby Bath
4. Information transmission. Packages and Products are
labels communicate how to use, transport, recycle, positioned against
or dispose of the package or product. a user or segment,
5. Marketing. The packaging and labels can be namely children
used by marketers to encourage potential buyers
to purchase the product.
Importance of Positioning
6. Convenience. Packages can have features that
Positioning creates an image of the company’s
add convenience in distribution, handling, stacking,
products in the mind of consumers,
display, sale, opening, re-closing, use, dispensing,
highlighting the most important benefits that
reuse, recycling, and ease of disposal.
differentiate the product from similar products
7. Security. Packages can be made with improved in the market. It establishes the image or
tamper resistance to deter tampering and can have identity of a brand or product so that
tamper-evident features to help indicate consumers perceive it in a certain way.
tampering.