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TRANSCRIPT
ENTREPRENEURSHIP
3209
A business is the production and/or sale of goods and/or
services to satisfy the needs, wants, and demands of
consumers with a purpose of making a profit or meeting a
specific goal.
Businesses come in all shapes and sizes!
Local (You tell me!)
Regional (Purity)
National (Tim Horton’s)
Global (McDonald’s)
1.1 WHAT IS A BUSINESS?
Profit is the income that is left after all costs and expenses are paid.
Expenses are those expenditures that are involved with running business, such as wages, as well as those assets that get used up in the process, such as paper and toner.
Costs are the amount of money required for each stage of production, such as the cost of raw materials.
Revenue is the total amount of money a business takes in.
Solvency is the abil ity to pay you debts and meet financial obligations.
BUSINESS BASICS
To be successful, a business must earn a profit, while keeping
both expenses and costs down!
Revenue – Expenses = Profit (Or Loss)
How can you increase profit?
Cutting costs
Increasing Revenue
What problems might you encounter with each?
BUSINESS BASICS
Goods – Items that can be seen or touched and, if attractive
enough, bought!
Services – Assistance provided, usually in return for a
payment, that satisfies needs and wants
Channels of distribution:
Brick and mortar stores – Wal-Mart
Telephone
Catalogues
Internet
BUSINESS BASICS
Unit 1
Topic 1.1
CONSUMER NEEDS AND
WANTS
How many times have you asked your parents for
something and they have said “no, you don’t need it” or
have you ever asked yourself when you are considering
buying something “Do I really need this”?
What is the difference between needs and wants – and
would everyone answer the same?
Need – An item necessary for survival
Examples include: Food, clothing or shelter
CONSUMER NEEDS AND WANTS
In this context, we’re
referring to
physiological needs
CONSUMER NEEDS AND WANTS CON’T
Want – An item not necessary for survival but that adds
pleasure and comfort to life
Examples include: …
How would you describe what a business is?
CONSUMER NEEDS AND WANTS CON’T
Cultura l d i f ferences – eg . a car. Some cul tures might cons ider a car a “want” or a luxur y i tem, whi le other cu l tures would consider t ranspor tat ion a necess i ty to get to work . In our cu l ture , most people would v iew e lectr ic i ty, running water, fue l to be necess i t ies o f l i fe or needs. Wi th chang ing technology and our heavy re l iance on the internet for (communicat ion, information, banking , etc ) i t could be argued that access to the internet i s a need .
Va lue d i f ferences – how people pr ior i t ize and judge thei r needs vs . wants can depend on thei r va lues . Back to school suppl ies o f internet access could be considered a “need” by some or judged to be a “want” by others . How a person would pr ior i t ize the impor tance of these i tems would be based on thei r own va lue system. Sometimes i t i s hard to dec ide i f something is a “want” or a “need” - that i s when we have to look at how we would pr ior i t ize the impor tance of each i tem to our sur v iva l and abi l i ty to car r y out ever yday l i fe .
Some i tems can be cons idered both a need and a want . For instance, food could be a need or a want , depending on the type of food.
You need to eat protein, vitamins, and minerals ( meat, nuts, or soy products to get protein, fruits, vegetables, yogurt , cheese, even breads to get vitamins and minerals. These basic kinds of foods are needs.
Ice cream is a want. You don't really need to eat ice cream to survive. You can eat it to get some vitamins and minerals, but other foods like cheese and yogurt give you more of those same vitamins and minerals without giving you the fat that ice cream does. Still, ice cream tastes good to many people. They like to eat it. They want it, but they don't need it. They like it, but they don't have to have it to survive.
NEEDS VS WANTS
Individual activity:
How would your family determine their needs vs. their wants
at the grocery store? Make a list of 15 items that would be
considered “needs” and another list of 15 items that would be
considered “wants”.
INDIVIDUAL QUESTION
A family in your neighbourhood lost their home during the
night to a fire and lost all of their possessions. Luckily,
everyone in the family got out safely although they were quite
shaken by the whole ordeal. The family did not have
insurance. There was a mom, a teenage boy (age 16) and a 6
month old baby girl. A local community group has donated
money to help get the family back on their feet – you and your
team have been asked to prepare a list of 14 items for each
family member as well as a (40 item) list for the household
starting with the most important needs. At the end you may
suggest some “wants” (no more than 5 per person and 10 for
the household), that the community may consider giving
additional funding for after the family’s needs have been met
initially.
GROUP ACTIVITY
Do you think having limited money to spend impacts the
decision on whether someone spends their money on “wants”
or “needs”. How would you describe your spending – does it
tend to be more “wants” or “needs”, do you think this will
change when you get older?
JOURNAL ENTRY
Producers are the businesses that make goods or provide
services.
Consumers are the people who buy computers, along with
those who have their computers serviced at computer-repair
shops.
Producers and consumers operate together to create a market
place! A marketplace is any location where producers and
consumers come together to engage in buying or selling
goods and services.
Ex. Mall, farmers market, restaurant etc.
THE ROLE OF THE CONSUMER
The consuming habits of Canadians tell businesses what
goods and services people want and how much they are
willing to pay for them!
Transition from business control of the market to consumer
control of the market.
Ex. “People can have the Model T in any colour –so long as it’s
black.”
Why the change?
Consumer demands and increased competition!
Why is competition good for both consumers and businesses?
CONSUMING HABITS
Today’s consumer wants access to a wide variety of cheap, reliable, goods and services.
Due to competition, if a consumer doesn’t l ike the price of a good or service at one business, they will simply go to another!
This is called Consumer purchasing power!
Thus businesses try to offer the best price they can. Price is partially determined by what the consumer is will ing to pay.
Ex. New cars starting at around $14 000
Consumers also influence the level of service!
CONSUMER INFLUENCE ON PRICE
1.) The customer is always right!
2.) If the customer is ever wrong, reread Rule 1!
THE TWO RULES OF DEALING WITH
CONSUMERS
Do you agree? Why or
why not?
Over time goods can become obsolete, meaning that people
no longer want them or that new or improved goods replace
them.
Can you give some examples of obsolete goods?
Services can also become obsolete when they are no longer
needed or wanted!
Question: has Netflix and online streaming made cable television
obsolete?
WHEN PRODUCTS BECOME OBSOLETE