Business Plan and Consumer Products
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Questions and Answers

Which type of product is characterized by routine purchases and low prices?

  • Specialty products
  • Shopping products
  • Impulse products
  • Convenience products (correct)

    • What is a key characteristic of specialty products?

  • Products not typically considered for purchase
  • Items to which consumers will exert special effort (correct)
  • Low-priced items purchased habitually
  • Products requiring minimal consumer research

    • Which of these options is NOT a type of consumer product?

  • Rented-goods services (correct)
  • Impulse products
  • Unsought products
  • Durable goods

    • What defines impulse products in the context of consumer behavior?

    <p>Products consumers do not plan to buy</p> Signup and view all the answers

    What distinguishes shopping products from convenience products?

    <p>They require more effort and research before purchase</p> Signup and view all the answers

    Which group of products is typically characterized by consumer unawareness or reluctance to purchase?

    <p>Unsought products</p> Signup and view all the answers

    What type of goods are described as being used over a long period of time?

    <p>Durable goods</p> Signup and view all the answers

    Which of the following best represents attribute-based shopping products?

    <p>Products evaluated for their features and performance</p> Signup and view all the answers

    What is an important characteristic of a successful entrepreneur regarding their approach to learning?

    <p>They have a strong willingness to learn.</p> Signup and view all the answers

    Which of the following competencies is essential for an entrepreneur in making decisions?

    <p>Risk assessing</p> Signup and view all the answers

    Which competency involves effectively working with diverse groups of people?

    <p>Interpersonal skills</p> Signup and view all the answers

    What role does 'optimism' play in entrepreneurial success?

    <p>It fosters resilience in challenging situations.</p> Signup and view all the answers

    In which area does a business plan primarily assist an entrepreneur?

    <p>Step-by-step guidance to realize a business idea</p> Signup and view all the answers

    What is a crucial aspect of adaptability that entrepreneurs must possess?

    <p>A unique adaptability to make decisions without complete information</p> Signup and view all the answers

    What is the primary focus of a depth strategy in product strategy?

    <p>Serving one segment with multiple products</p> Signup and view all the answers

    Which of the following competencies does NOT directly fall under the core competencies in entrepreneurship?

    <p>Project Management</p> Signup and view all the answers

    Which statement is true regarding the impact of entrepreneurship on the Philippine economy?

    <p>It helps uplift its performance in worldwide competition.</p> Signup and view all the answers

    Which pricing strategy focuses on building consumer loyalty by selling key items at low prices?

    <p>Leader pricing</p> Signup and view all the answers

    What does a penetration pricing strategy aim to achieve?

    <p>Capture customers through low prices</p> Signup and view all the answers

    How does a demand-based price strategy determine pricing?

    <p>Researching consumer desires and needs</p> Signup and view all the answers

    What does the term 'odd pricing' refer to in pricing strategies?

    <p>Utilizing pricing that ends in odd numbers to attract customers</p> Signup and view all the answers

    Which objective is associated with a sales-based pricing strategy?

    <p>Increasing market share</p> Signup and view all the answers

    What characterizes a customary pricing approach?

    <p>Prices are maintained over a long duration</p> Signup and view all the answers

    What is a potential result of using skimming pricing?

    <p>Establishing a premium brand image</p> Signup and view all the answers

    What is multiple-unit pricing primarily aimed at encouraging?

    <p>Offering discounts for bulk purchases</p> Signup and view all the answers

    Which pricing strategy typically involves offering both a basic product and a premium version?

    <p>Price lining</p> Signup and view all the answers

    What does exclusive distribution refer to in the context of channel intensity?

    <p>Employing a limited number of middlemen in a specific area</p> Signup and view all the answers

    Which of the following best defines indirect channel distribution?

    <p>Transfer through independent intermediaries</p> Signup and view all the answers

    What is the primary function of physical distribution?

    <p>Efficient delivery of products to designated places</p> Signup and view all the answers

    What is the main purpose of geographic pricing?

    <p>To set prices based on buyer distance from the seller</p> Signup and view all the answers

    Which distribution channel involves manufacturers directly selling to end-users without intermediaries?

    <p>Direct channel distribution</p> Signup and view all the answers

    What do price adjustments typically reflect in the pricing strategy?

    <p>Changes in consumer demand and competitive conditions</p> Signup and view all the answers

    What is family packaging primarily aimed at achieving?

    <p>Creating a uniform appearance for all products</p> Signup and view all the answers

    Which of the following best describes reuse packaging?

    <p>Packaging that can serve multiple purposes after use</p> Signup and view all the answers

    In the context of positioning, what does the term 'niche' refer to?

    <p>A specialized segment of the market</p> Signup and view all the answers

    Which of the following statements accurately describes the role of branding?

    <p>Brands help consumers recognize product quality</p> Signup and view all the answers

    What is a key advantage of co-branding?

    <p>It creates a broader customer appeal</p> Signup and view all the answers

    What does the Producer’s Strategy primarily focus on?

    <p>Superiority of their own product in the market</p> Signup and view all the answers

    Which of the following is a disadvantage of co-branding?

    <p>Difficult coordination between brands</p> Signup and view all the answers

    What is the primary focus when positioning a product in the market?

    <p>Differentiation from competitors</p> Signup and view all the answers

    Study Notes

    Business Plan

    • A business plan is a step-by-step guide which assists you in realizing your business idea

    Types of Products

    • Durable goods are physical products that are used over a long period of time
    • Non-durable goods are physical products that are quickly and easily consumed or worn out
    • Rented-goods services are consumer rented facilities
    • Owned-goods services are repair and maintenance services rendered
    • Non-goods services are personal services

    Types of Consumer Products

    • Convenience products are purchased with the minimum or less effort because the buyer has knowledge of product characteristics prior to shopping
    • Shopping products are acquired through further knowledge and information in order to make a final purchase decision
    • Specialty products are items with particular brands and stores to which consumers are loyal and ready to exert special effort
    • Unsought products are products that consumers are either not aware of the brand existence or have awareness of the brand however not usually considering buying it

    Product Strategies

    • Breadth strategy reaching multiple segments with a single product
    • Depth strategy serving one segment with multiple products
    • Tailored strategy customizing products for each segment

    Price

    • The peso value an entrepreneur assigns to a certain product or service after considering its costs, competition, objectives, positioning, and target market
    • Sales Based strategy aims at sales growth or maximizing market share
    • Profit Based strategy aims at maximizing profit, earning a satisfactory return
    • Status Quo Based strategy aims at maintaining a good image to the community by creating projects that protect its welfare and goodwill
    • Broad price policy involves coordinated pricing decisions
    • Penetration pricing uses low prices to capture customers
    • Skimming pricing uses high prices to attract a market segment concerned with product quality and status

    Price Strategies

    • Cost-based price strategy sets prices by computing costs and expenses
    • Demand-based price strategy sets prices after researching consumer desires
    • Competition-based price strategy sets prices in relation to competitors

    Implementing Price Strategy

    • Customary pricing maintains the price over an extended period of time
    • Variable pricing responds to costs fluctuations or differences in demand
    • One-price policy sets one price for all products even though they differ in design
    • Flexible pricing is based on the customer’s ability to negotiate or buy power of the customer
    • Odd pricing uses odd numbers to attract customers
    • Price-quality association suggests that a high price contains high-quality materials
    • Prestige pricing follows the price floor and ceiling set by the government
    • Leader pricing sells key items at low prices to gain consumer loyalty within its product line
    • Multiple-unit pricing offers discounts to consumers for buying in large quantities
    • Price lining sells two models of different quality and features at different prices
    • Price bundling offers a basic product and service for one total price
    • Unbundled pricing sells by individual components and allows customers to decide what to buy
    • Geographic pricing prices are set depending on the distance of the buyer to the seller
    • Terms of payment price agreements including discounts, timing of payments and credit agreements

    Place

    • Location or the medium of transaction

    Channel of Distribution

    • People or organizations involved in the distribution process
    • Direct sale involves the company/firm moving goods directly to the users.
    • Original equipment manufacturer sales are selling a manufactured product that is later sold as a finished product to the end user.
    • Manufacturer’s representative is a wholesaler employed by producers and paid according to quantity sold.
    • Wholesalers sell to retailers or other agents for further distribution through the channel
    • Brokers are distributors who buy directly from wholesalers and sell to retailers or end users.
    • Retailers sell directly to customers in the store.
    • Direct mail is printed materials used in a targeted campaign to consumers.

    Basic Types of Channel Distribution

    • Direct channel distribution transfers goods & services from manufacturer to final user or customer without the intervention of independent middleman
    • Indirect channel distribution transfers goods or tangible/intangible products and services from manufacturer or producers to independent intermediaries to customer .

    Intensity of Channel Coverage

    • Exclusive distribution uses a limited number of middlemen in a geographic area.
    • Selective distribution organizes a moderate number of wholesalers.
    • Intensive distribution organizes a large number of middlemen to obtain widespread market coverage and channel acceptance

    Physical Distribution

    • Covers the broad range of activities in connection with the efficient delivery of raw materials & finished products to designated places and designated times and in proper conditions.
    • Family packaging makes the package identical for all products using common features on all products
    • Reuse packaging designs and promotes packages which can serve other purposes when contests are consumed
    • Multiple packaging places several units of a product in a single container

    Positioning

    • How the firm differentiates their product or service from those of the competitors and serving a niche

    Product Positioning

    • Creating an image to the public presenting how they want to position the product
    • The target market must be well informed about a new product – what it is, what it can do, what makes it better than others, and who should buy it

    Market Positioning

    • Innovator/Leader vs.Follower: Being an innovator/leader means being an initiator in selling a new product to the market.
    • Domestic vs.International/Global: Focusing only on local consumption, focuses only on the minority of markets in the country.
    • Quality vs.Price: Quality must be the priority in selling the product not considering how much it will cost, prioritizing the materials being used

    Brand

    • Name or mark that is intended to identify the seller’s product and differentiate it from the product of the competitors

    Brand Mark

    • Part of the brand that appears in the form of symbols designed in distinctive lettering or colors

    Advantages of Branding

    • Brands make it easy to identify the product or service
    • Brands assure the buyer that they get the same quality of products
    • Brands reduce price comparison.

    Branding Strategies

    • Producer’s Strategy employed by product manufacturers’ that dominate the greater market due to the superiority of their product
    • Middleman’s Strategy called as co-branding where the producer and sole distributor carry the brand name of the manufacturer and that of the middlemen

    Advantages of Co-Branding

    • Creates broader customer appeal
    • Develops greater brand equity
    • Expands the middlemen brand in the market

    Disadvantages of Co-Branding

    • Coordination is oftentimes difficult with the producer and the middlemen
    • It entails legal contracts which can be complex and difficult.

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    Description

    This quiz covers essential concepts related to business plans and the different types of products available in the market. It explores durable and non-durable goods, as well as various consumer products such as convenience, shopping, specialty, and unsought items. Test your understanding of these fundamental business principles.

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