Business Bridging Work

Business Bridging work
Key words:
Entrepreneur:
 An entrepreneur is characteristic which includes being self-motivated, responsible, resilient,

finding opportunities and being confident.
Sole trader:
 A sole trader is a type of business owner who has 100% responsibility of all the business and
if the business fails then the owner must pay his own assets to the bank. Also known as
unlimited liability
Partnership:
 A partnership contains 2-20 business owners, and you must sign the deed of partnership this
is also another unlimited liability business.
Private limited company:
 This type of business has special features such as being able to sell its shares on the stock
market to whoever they want no-one else can buy shares from them. This sort of business is
limited liability (where only your business assets are taken if your business goes bankrupt)
and you must sign many documents.
Public limited company:
 This sort of business also has special features which are different from a Private limited
company such as its shares are public so anyone can buy from them and to own the
company you need to buy 51% of the companies shares. This is also a limited liability (where
only your business assets are taken if your business goes bankrupt) and again to become a
public limited company you need to sign many documents.
Mass Market:
 This is a market that does not target a specific target market it sells many products. For
example, retailers they sell many products in different categories.
Niche Market:
 This is a market that focuses on a specific target in the market such as a restaurant for vegans
which is highly specified for people’s preferences which is basically what a niche market is
about.
Market segmentation:
 Market segmentation is when you divide your targets into groups, this helps so then you
have the specifics to sell your new product. For example, let say Nike and they want to create
a brand-new shoe they will have to consider the factors that affect the customer such as is it
affordable, what is its purpose, so it goes in the category of lifestyle and there are other
factors such as gender and age and where to advertise It on.
Above the line promotion:
 It is when promotional methods are in place however the company has no control over the
promotions.
Below the line promotion:
 It is when advertising is done through media rather than mainstream such as radio and tv.
Examples of below the line promotion are catalogues, emails and more.
Role of marketing
What is marketing:
Firstly, to begin with, marketing means the activity of a business selling and promoting its products
and services to customers. Why is this important, it is important because it helps the business
engage with a potential customer and persuade them into buying their products.
How has marketing changed overtime:

It has changed because of several factors such as the advancement of technology and how
interdependent the world has become through technology, the increase of population and the
increase in demand for needs and wants. Businesses before the advancement of technology used the
media such as newspapers then came radio and after the radio came television. This had become a
great tool for entrepreneurs/ business owners because they could showcase their product to every
household that had a Tv. This gave them an advantage of gaining more customers and becoming
more popular so then they could survive and possibly become the most powerful business in their
industry. When I mean powerful, I mean that they have gone above an oligopoly and maybe reached
into a monopolistic business by dominating their competitors. However, this is not entirely true
mainly because if that one business could do it then many others could, the only problem was the
cost of advertising on Tv.
Methods of Marketing (pros and cons):

Market research:
Is a very crucial method of marketing mainly because it requires the business to gather information
about what the customers want from the business. There are two common types of research such as
primary research and secondary research. In primary research you collect the research by yourself by
doing focus groups, conducting surveys and interviews. The advantage of primary research is that it
is up to date, and it is specific to the business. However, the disadvantage of primary research is that
it is expensive, and it does bring a cost to the business. Now on to secondary research which is
basically gathering information about what the customer wants online or somewhere it has been
recorded such as magazines or articles. Advantage of secondary research is that it is free, and it is
accessible any time anywhere and any day. Disadvantage of secondary research is that it might not
be new or specific enough for what the business is looking for.
Market Segmentation:
This is when a business divides its target market by lifestyle, gender, ethnicity, price, location so then
its products have a purpose. What I mean by this is that these 5 factors can help the business decide
what to make and how to make and who to sell them to this also applies to when they are
advertising so then they must be cautious when they do, they can’t advertise something misleading
or controversial otherwise it might affect their brand name. This is basically a guideline for business
on how to make their products. Which is a good advantage however, the disadvantage to this would
be that it could be expensive.
Marketing Mix (4ps)

Product: this is how the business designs its products and how it packages its products to meet the
customer’s needs
Price: Setting a price that is equal to the quality and quantity of the product.
Place: The type of distribution channel a business may choose to use there are two such as indirect
distribution channels and direct distribution channels
 Indirect distribution channels is when the goods are sold by a third party or a middleman like
retailers for example Aldi, Asda (supermarkets in general),
 Direct distribution channels is when the owner is selling its items directly to the customer
Promotion: To advertise or make the product appealing to customers by reducing its price or
giving out deals and discounts.
Pros and Cons of above the line promotion:

Pros:
 It can raise brand awareness.
 It can be reached to a wide range of people.
Cons:
 It is very expensive to advertise on mainstream Tv.
 Businesses pay a company to advertise their products, so they don’t have much control over
what’s being shown or said
Pros of below the line promotion:

Pros:
 BTL promotion is aimed directly at the targeted audience.
Sources of finance:
 Loans
 Overdraft
 Crowdfunding
 Owners’ capital
 Retained profits.
 Share issue/ selling stock
 Mortgages
Loans:
Advantages – it is quick, and you get the right amount you need, and you can pay it back monthly for
5 to 30 years
Disadvantages – If you do not repay back then you will have to pay back with interest and you will
need to be a reliable person, business plans may work but your credit rating might hold you back.
Overdraft:
Advantages – You can spend the money you do not have.
Disadvantage – There is a limit on the amount of money you can spend when your balance is zero
the range is between £100-1000 or maybe more in some cases once you have enough funds, you
need to pay them back immediately, but you do have time (enough for you to make the money back)
Crowdfunding:
Advantages – If customers invest them that means the product or service is worth investing and so
their business might become successful.
Disadvantages – it won’t be a lot and it might take a while to get any funds.
Owners Capital:
Advantages – no repayments and it is quick a payment.
Disadvantages – You may not have enough, and it is risky putting your own assets and money on the
line.
Retained profits:
Advantages – No repayment, and it can help the company grow by increasing stock and paying
employees more.
Disadvantages – If a company makes low profit and it shareholders ask for dividends then the
company will lose its profits.
Share issue/ selling stocks:

Advantages – You can free up space and at the same time gain more finance.
Disadvantages – You might not be able to sell quickly, and you won’t get the original price you paid
for back.
Mortgages:
Advantages – You have up to 25 years to pay the loan back so you will have time to settle down with
your business.
Disadvantages – If interest rates increase (which they will) then you will have to pay more even if
you’re paying instalments

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Business Bridging work

 An entrepreneur is characteristic which includes being self-motivated, responsible, resilient,

Private limited company:

Public limited company:

Below the line promotion:

How has marketing changed overtime:

Methods of Marketing (pros and cons):

Marketing Mix (4ps)

Pros and Cons of above the line promotion:

Pros of below the line promotion:

Advantages – You can spend the money you do not have.

Advantages – no repayments and it is quick a payment.

Share issue/ selling stocks:

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