Reasons for staying small 3.2.4

Question 1

Why do businesses want to stay small?

Answer 1

Despite the advantages of large scale production, there are advantages to not growing. Small Business survival in competitive markets depends on the following:
-Product differentiation and USPs
-Flexibility in responding to customer needs
-Customer services
-E-Commerce

Question 2

Advantages of staying small

Answer 2

• Personal service
  -More flexible
  -More efficient
  -Lower costs
  -Lower barriers to entry
  -Monopolistic

Question 3

Product differentiation/ USPs

Answer 3

If a small business can offer customers something that their larger rivals do not, survival is possible. People often prefer to buy product that are different from the majority of others on the market.

Question 4

Flexibility

Answer 4

Small and nimble businesses are often quicker in identifying new opportunities and responding to the needs of their customers.

Question 5

Customer services

Answer 5

Offering high-quality customer service is a way of adding value to products. It can also give businesses a competitive advantage in the market and allow them to survive in markets dominated by larger companies.