Starting a Business Many students starting an AS course will have done GCSE. Typically they will have undertaken coursework investigating how to start-up a business. They will have developed knowledge of the key elements of a business plan. What many students will not have done is consider in any depth the risk element associated with starting a new business or the motivations of an entrepreneur. As an introduction to Unit 1, why not get students to investigate what made certain individuals start a new business? Undoubtedly, when asked to name examples of entrepreneurs many students will be able to produce a wellthumbed list: Richard Branson and James Dyson will be to the fore. Try to get students to look beyond the typical and find some more unusual examples. Why not get them to investigate some of the following and discuss the findings?: Starting Point: People Innocent Drinks - Smoothies Linda Bennett – LK Bennett Shoes, Clothes and Accessories Lloyd Keisner – Tabletalk Media Guy Lindley – Luxury caravans Karan Bilimoria – Cobra Beer Mike Lucy – Catering Glenys Berd – Love Those Shoes Why have these individuals launched their own businesses? Why did they choose a particular business idea? What skills did they have which helped to get their business off the ground? Do they have any characteristics in common? People + Good Ideas = Success? Good ideas don’t necessarily make for successful products and successful firms. Dulux recently launched the PaintPod Roller system. It offered a convenient way to decorate without mess. Unfortunately, convenience comes at a price. For many consumers £69.99 was too much. Some DIY shops have been discounting the PaintPod Roller system and selling it for as little as £34.99. Encourage students to think about why some products and some firms don’t succeed. What factors will determine the success of a firm or new business idea? The following link will offer some suggestions as to why businesses may fail: http://www.insolvencyhelpline.co.uk/ltd-companies/common-reasons-forbusiness-failure.php Students could use the BBC news website to find out how the economy may affect business success. Get Students Thinking ‘Higher Order Skills’ It is never too early to introduce the higher order skills which students need to demonstrate in exams. It is important that students develop critical judgement. This is a skill which students need to demonstrate in exams – the earlier they start to develop this skill the better. A good idea does not guarantee a successful business if the business lacks sufficient capital to make the idea work. The Dulux PaintPod Roller is a good idea but the price was wrong. Use Your Area Get students to identify five businesses in the local area that have started recently. Are they likely to be successful? How much competition do they face? Is the business in the right location? Is the marketing right? Is the product right? Too often new businesses make trade-offs. They may choose cheaper premises to rent. The consequence of this is that they might get fewer customers. Cost-cutting by using cheap fittings may give potential customers the wrong impression and may put them off. Within your area, there may well be premises that have seen a number of business start-ups. Every time a new business opens, it lasts a few weeks or months and then, it closes. Ask your students why businesses don’t succeed in these premises. The answer is likely to be, ‘wrong location, location, location!’ You may well wish to revisit what students have learnt from this exercise at a later date, when discussing the marketing mix. Resource created by Ian Etherington, August 2008.
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