Introduction to Business Concepts
Mission Mission defines the purpose of an organization’s existence (Toftoy and Chatterjee 41). In most cases, companies are established with a mission of improving the quality of service delivery. Other firms are also initiated to provide new commodities that have never been in existence in a particular region. Whatever the nature of a business, its mission must be streamlined towards improving the value of commodities. That is the only way through which it can sustain competition from the already existing firms. Additionally, a company which is expanding its operations must necessarily readjust its model in order to accommodate the increasing number of activities. A good business model must specifically identify the company’s target customers. It is advisable that a company needs to narrow its market to a specific niche so that it specializes in providing a higher value.
The model can also outline the demographics of target customers as well as the strategies for achieving their demands. Secondly, a good business model must identify the key activities which a company will be engaging in. Such kinds of businesses tend to dominate over other firms and usually control a larger share of the segmented market. Accordingly, the dominating firm will always realize high sales volume and superior profit margins. A firm’s competitive advantage can originate from its cost structure whereby the production activities have been optimized to utilize lower costs in producing high-quality commodities. Even though this might be difficult to achieve, large corporations which enjoy the economies of scale are able to reduce their overhead expenses and only focus on the specific production activities.
In addition, a competitive advantage can also arise from a company’s unique branding of its items. In order to satisfy customers’ needs, an organization must provide quality commodities. When customers are fully satisfied, they tend to return for similar services and also refer their friends and families to purchase from the same firm. On the hand, bad experiences scare customers away and create negative publicity for a company. This might result in an unprecedented decline in sales volume and consequent losses for the business. Competitive companies should also understand that customers’ needs are dynamic hence they should always engage in market research in a bid to establish the exact description of products that satisfy consumers (Bergman and Klefsjö 29). For purposes of improving the quality of an item, most companies engage their customers during the production process.
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