Urban Outfitters Continuing Case Study: Creati
1. Identify at least three challenges when setting up a business. Explain why they are challenges.
Three challenges a business might face when setting up their business are; start up cost, staffing, and sales. The cost or investment that a business needs to start their business is a crucial part of setting up. A business must have the right amount of money to start operations. Failure may come before the business begins if monies are not handled correctly. Staffing is another challenge a new business may encounter. Business must have qualified employees to run a successful business. If a business hires a group of chefs to do construction work, the end is near for that business. Sales are the final challenge a business may face when setting up. A high sales volume is crucial for any successful business. Revenue must be higher than expenses.
2. Define what a “niche” product is. Give at least three examples of niche products.
According to the Southern Pine Timber glossary online, “a niche product is an product manufactured and marketed for specialized and often technical uses. Niche products are readily differentiated from other products” (www.southernpinestimber.com). For example a Solar Hat, computer gamer mouse, and a drummer drum key.
3. Explain why a niche company might have an advantage in a market. Would price necessarily be an advantage? Explain why or why not.
“A niche company would have an advantage in a market because they have opportunity to provide products and services to a group that other business have overlooked”(Susan Ward, 2010, para.1). Pricing would have an advantage because the company can offer a product that would have little or no competition, therefore the business can set their own price.
4. Identify and explain three reasons why customers would pay more for exclusivity.
People pay for exclusivity because some feel like they have to have something that only...