BM133 Introduction to Small Business Management - Ch 7

tactical actions

Competitive responses with low resource requirements

perceptual map

A graphic display which positions products, services, brands, or companies according to their scores on important strategic dimensions

decline stage

A life cycle stage in which sales and profits of the firms in the industry begin a falling trend

industry analysis

A research process that provides the entrepreneur with key information about the industry, such as its current situation and trends. (IA)

Blue Ocean Strategy

A strategy based on creating a new product or service that has no competitors.

differentiation strategy

A type of generic strategy aimed at clarifying how one product is unlike another in a mass market

boom

A type of life cycle growth stage marked by a very rapid increase in sales in a relatively short time. New firms come to existence to match the high demand.

supply chain

A way to think about the line of distribution of a product from its start as materials outside the target firm, to its handling in the target firm, to its handling by sellers, with placement into the hands of customers. A supply chain is a network of entities and people that work directly and indirectly to move a good or service from production to the final consumer. Read more: Search | Investopedia https://www.investopedia.com/search/#ixzz5U6vsepYt Follow us: Investopedia on Facebook

retrenchment

An organizational life cycle stage in which established firms must find new approaches to improve the business and its chances for survival

innovative strategy

An overall strategic approach in which a firm seeks to do something that is very different from what others in the industry are doing

industry dynamics

Changes in competitors, sales and profits in an industry over time

gross profit

Funds left over after deducting the cost of goods sold

5 Steps of Strategic Planning

Goals; Customers and Benefits; Industry Dynamics and Analysis; Strategy Selections; Post Start-Up Tactics

Supply and Demand

Supply and demand is perhaps one of the most fundamental concepts of economics and it is the backbone of a market economy. Demand refers to how much (quantity) of a product or service is desired by buyers. The quantity demanded is the amount of a product people are willing to buy at a certain price... Supply represents how much [firms] can offer. The quantity supplied refers to the amount of a certain good producers are willing to supply when receiving a certain price. Read more: Law of Supply and Demand: Basic Economics https://www.investopedia.com/university/economics/economics3.asp#ixzz5U6m3kGzV Follow us: Investopedia on Facebook

net profit

The amount of money left after operating expenses are deducted from the business

introduction stage

The first industry life cycle stage in which a product or service is being invented and initially developed in an industry (that industry can already exist or be a new one created by the new product or service)

industry

The general name for the line of product or service being sold, or the firms in that line of business

target market

The market a company wants to sell its products and services to, and it includes a targeted set of customers for whom it directs its marketing efforts Read more: Search | Investopedia https://www.investopedia.com/search/#ixzz5U6tTpMI3 Follow us: Investopedia on Facebook

magic number

The post-tax income the entrepreneur personally seeks from the business

growth stage

The second industry life cycle stage in which customer purchases increase at a dramatic rate. The growth stage can happen in 2 ways. The growth can be at a steady, expected rate; or as a boom.

scale

The size of your market. See also mass and niche markets.

maturity stage

The third industry life cycle stage, marked by a stabilization of demand, with firms in the industry moving to stabilize or improve profits through cost strategies

value proposition

The unique selling point of a business (also known as benefits)

generic strategies

Three (3) widely applicable classic strategies for businesses of all types: differentiation, cost, and focus

mass market

a customer group that involves large portions of the population

cost strategy

a generic strategy aimed at mass markets in which a firm offers a combination of cost benefits that appeals to the customer

focus strategy

a generic strategy that targets a portion of the market, called a segment or niche

niche market

a narrowly defined segment of the population that is likely to share interests or concerns

shake-out

a type of industry life cycle stage following a boom in which there is a rapid decrease in the number of firms in an industry due to the supply surpassing the demand. The shake-out describes the many firms closing as a result of decreased demand.

parallel competition

an imitative business that competes locally with others in the same industry

goal

an intended outcome for your business

entry wedge

an opportunity that makes it possible for a new business to gain a foothold in a market

firm

an organization that uses resources to produce a product or service to sell

incremental innovation

an overall strategic approach in which a firm patterns itself on other firms, with the exception of one or two key areas

imitative strategy

an overall strategic approach in which the entrepreneur does more or less what others are already doing

competitor

any other business in the same industry as yours

strategic actions

competitive responses requiring a major commitment of resources

market

population of customers for your product or service; the people who are or could become your customers (actual and potential customers).

marketing

the actions of a business related to promoting and selling products or services

degree of similarity

the extent to which a product or service is like another

scope

the geographic range covered by the market - from local to global.

strategy

the idea and actions that explain how a firm will make its profits

competitive advantage

the particular way a firm implements customer benefits that keeps the firm ahead of other firms in the business

pure innovation

the process of creating new products or services, which results in a previously unseen product or service