What are the problems and prospects of business Enterprise?


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Shane Richardson Profile
Business enterprise is the providing of products and services to the commercial, industrial and financial markets.

  • Real life example
The problems and prospects of this would tend to depend on the particular business in question. For example, even if you take two very similar stores (one cheap clothing store and mid range clothing store), the differences are immense. If you consider the aforementioned stores during a time of recession, the problems and prospects would be highly opposed.

The cheap clothing store will likely see huge profit growth and will be able to consider expansion, new product lines and bonuses for staff. People who have previously shopped in the mid range store will be looking to spend less money and so may opt to shop in the cheaper store.

The mid range store, on the other hand, will likely see a drop in sales and profit due to the average family being hit by money worries. As mentioned they may begin to shop elsewhere and this will cause problems. Prospects for this store will be limited due to lack of funds and instead their problems will increase with issues like redundancies and store closure possibilities.

  • Problems
Recession can lead to store closures, redundancies and massive drop in profits.

Thieves can cost companies millions each year through petty theft; it is not unusual for individual stores to lose tens of thousands each week.

The costs of running a business can quickly outweigh the profits resulting in the company making a loss. Costs such as staffing, bills, rent, rates and insurance need to be considered.

  • Prospects
When a company is profitable, it suggests it is what the market want and need at that present time and this should be the time companies expand and develop.

When companies are doing well new product lines can be added and even stores that branch into new areas using a similar name can be opened.

  • SWOT
A good way of weighing up the positives and negatives of an individual company is to carry out a SWOT analysis. Basically SWOT stands for strengths, weaknesses, opportunities and threats. Make a list of each to understand more about an individual company.

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