2.5.3 The Competitive Environment

Question 1

Nature of ownership

Answer 1

May decide to expand in a very competitive market or more into new markets or new products
May become plc/ltd - sell shares and raise finance
Improves image of business and reduce risk for owner

Question 2

Nature of product/ service sold

Answer 2

In a very competitive market a business will need to differentiate 
Strong brand image 
USP
Added value 
Constantly innovating

Question 3

Product range

Answer 3

Competitive market - business considers product range
To attract customers will need to carefully consider products on offer
Agriculture and farms struggle as they produce generic goods

Question 4

Pricing policies

Answer 4

In very competitive - price = differentiating feature

Question 5

Marketing methods

Answer 5

Competitive market - may need to be more innovative with their marketing
Usines new media methods to get the message across

Question 6

Market size

Answer 6

Number of buyers and consumers and sellers to producers. in a particular market
Important for business wanting to launch a new product

Question 7

Importance of research

Answer 7

Understand target market
Identify customer base
Weigh up competition