Core competencies | An overview. Economies of Scope Definition & Example. Similar to economies of scale, economies of scope provide companies with a means to generate operational efficiencies. However, economies of scope are often obtained by producing small batches of many items (as opposed to producing large batches of just a few items). Because they frequently involve marketing and distribution efficiencies, economies of scope are more dependent upon demand than economies of scale. This is often what motivates manufacturers to bundle products or to create a whole line of products under one brand. Although economies of scope are often an incentive to expand product lines, the creation of new products is often less efficient than expected. Nevertheless, when done correctly, economies of scope can help companies gain a significant competitive advantage. What Are Economies Of Scale? When more units of a good or a service can be produced on a larger scale, yet with (on average) less input costs, economies of scale (ES) are said to be achieved.
Alternatively, this means that as a company grows and production units increase, a company will have a better chance to decrease its costs. According to theory, economic growth may be achieved when economies of scale are realized. Adam Smith identified the division of labor and specialization as the two key means to achieve a larger return on production. Through these two techniques, employees would not only be able to concentrate on a specific task, but with time, improve the skills necessary to perform their jobs. Just like there are economies of scale, diseconomies of scale (DS) also exist. Internal and External Economies of ScaleAlfred Marshall made a distinction between internal and external economies of scale.
Where Are Economies of Scale? Is Bigger Really Better? What is the difference between moral hazard and adverse selection? Adverse selection occurs when there's a lack of symmetric information prior to a deal between a buyer and a seller, whereas moral hazard occurs when there is asymmetric information between two parties and change in behavior of one party after a deal is struck. Moral hazard and adverse selection are two terms used in economics, risk management and insurance to describe situations where one party is at a disadvantage. Adverse selection describes an undesired result due to the situation where one party of a deal has more accurate and different information than the other party. The party with less information is at a disadvantage to the party with more information. The asymmetry causes a lack of efficiency in the price and quantity of goods and services. For example, assume there are two sets of people in the population, those who smoke and do not exercise and those who do not smoke and do exercise.
The insurance company asks the individuals to fill out questionnaires to distinguish them. Adverse Selection Definition. What is Adverse Selection? Share Video undefined What is 'Adverse Selection' Adverse selection refers to a situation where sellers have information that buyers do not, or vice versa, about some aspect of product quality. BREAKING DOWN 'Adverse Selection' Adverse selection occurs when one party in a negotiation has relevant information the other party lacks. Adverse Selection in the Marketplace A seller may have better information than a buyer about products and services being offered, putting the buyer at a disadvantage in the transaction.
Adverse Selection in Insurance Because of adverse selection, a company selling insurance finds people at higher risk of death are more willing to take out and pay greater premiums for policies. Adverse Selection Solutions In the case of insurance, avoiding adverse selection requires identifying groups of people more at risk than the general population and charging them more money. Idea-Expression Dichotomy Remains Key to Copyright Protection of New Technology | CEBblog™ Posted on October 22, 2014 by Julie Brook, Esq. Can you state the difference between an idea and the expression of that idea?
Don’t worry if it doesn’t slip off your tongue. This distinction is one of the most difficult areas of copyright law but far from academic because copyright law doesn’t protect ideas, but it does protect expressions of ideas. And this distinction remains key to technology copyright cases. Ideas themselves, separate from their expression or the form in which they are embodied, aren’t protectable under the Copyright Revision Act of 1976, although they may be protectable if they qualify under trade secret or patent law. But how can you determine whether something is an idea or an expression of an idea, particularly when it comes to new technology?
The court found that both Apple’s and Microsoft’s operating systems included similar elements—i.e., windows, icons representing familiar objects—but these were ideas, not subject to copyright protection. Like this: Understanding Derivative Work Copyright – Are you Qualified for Copyright? Derivative Work Copyright – What is Derivative Work? Before discussing derivative work copyright, you need to have a clear picture of what a derivative work is.
Only then can you decide whether to go for derivative work copyright. The Copyright Act (17 U S C) defines derivative work as: "A “derivative work" is a work based upon one or more pre-existing works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted. A work consisting of editorial revisions, annotations, elaborations, or other modifications which, as a whole, represent an original work of authorship, is a derivative work". The adjacent image is a derivative work based on a photograph taken by S. Another example of derivative work is Mona Lisa with Moustache, which is based on the original Mona Lisa painting.
Intellectual property | Wex Legal Dictionary / Encyclopedia. Overview In general terms, intellectual property is any product of the human intellect that the law protects from unauthorized use by others. The ownership of intellectual property inherently creates a limited monopoly in the protected property. Intellectual property is traditionally comprised of four categories: patent, copyright, trademark, and trade secrets. Common Law Common law did not recognize intellectual property rights. Justice Brandeis communicated this belief in his dissent to International News Service v. Associated Press:"The general rule of law is, that the noblest of human productions—knowledge, truths ascertained, conceptions, and ideas—become, after voluntary communication to others, as free as the air to common use. " Modern Intellectual Property Rights The products of the human intellect that comprise the subject matter of intellectual property are typically characterized as non-rivalrous public goods.
Designs Related terms See also: What is Open Source Entrepreneurship? – Tor on Tech. Recently, I commented to Dogpatch's blog which coined the idea of Open Source Entrepreneurship for their philosophy; "the community benefits from a very high level of interactivity and sharing between the members". With the growing role of open source as an enabler of entrepreneurship, I believe that coining the idea carries responsibility and deserves further elaboration.
With EasyPeasy, a community providing an open source operating system for netbooks, I observe that some competitors makes use of open source software alike. They don't, however, share their source code or new builds back with the community - which in the first place provided them with the opportunity. Open source software may be an impetus to entrepreneurship, but is it mutual? Should open source enabled entrepreneurs contribute back, or does the argument “we give back when we grow big” holds? I believe that entrepreneurs that are using open source should share their modifications and extensions from the start. 121115. The Marketing Mix and the 4Ps of Marketing - from MindTools.com. Understanding How to Position Your Market Offering Prime your product's entry into the marketplace by asking the right questions. What are the 4Ps of Marketing? The 4Ps of marketing is a model for enhancing the components of your ‘marketing mix’ – the way in which you take a new product or service to market.
It helps you to define your marketing options in terms of price, product, promotion, and place so that your offering meets a specific customer need or demand. What is marketing? It's simple! There's a lot of truth in this idea. But if you get just one element wrong, it can spell disaster. The marketing mix is a good place to start when you are thinking through your plans for a product or service, and it helps you avoid these kinds of mistakes.
Understanding the Tool The marketing mix and the 4Ps of marketing are often used as synonyms for each other. The 4Ps are: Product (or Service). A good way to understand the 4Ps is by the questions that you need to ask to define your marketing mix. What Is Brand Equity and Why is it Valuable? - Prophet Thinking. Brand Equity Definition. Share Video undefined What is 'Brand Equity' Brand equity refers to a value premium that a company generates from a product with a recognizable name, when compared to a generic equivalent. BREAKING DOWN 'Brand Equity' Brand equity has three basic components: consumer perception, negative or positive effects, and the resulting value. Finally, these effects can turn into either tangible or intangible value. General Example of Brand Equity A general example of a situation where brand equity is important is when a company wants to expand its product line.
Specific Example of Brand Equity Brand equity is a major indicator of company strength and performance, specifically in the public markets. A large component of brand equity in the hardware environment is consumer perception of the strength of a company's ecommerce business. What is niche marketing? And 8 good reasons why you should bother and not worry about losing out.
7 Steps to Defining Your Niche Market. In their book, Start Your Own Business, the staff of Entrepreneur Media, Inc. guides you through the critical steps to starting a business, then supports you in surviving the first three years as a business owner. In this edited excerpt, the authors explain how you can find the right niche for your entrepreneurial needs. You’ve come up with a great idea for a business, but you’re not ready to roll yet. Before you go any further, the next step is figuring out just who your market is. There are two basic markets you can sell to: consumer and business. These divisions are fairly obvious. For example, if you're selling women’s clothing from a retail store, your target market is consumers; if you're selling office supplies, your target market is businesses (this is referred to as “B2B” sales). In some cases—for example, if you run a printing business—you may be marketing to both businesses and individuals.
No business—particularly a small one—can be all things to all people. 1. 2. 3. 4. 5. 6. Red Herring Definition. What is 'Red Herring' A red herring is a preliminary prospectus filed by a company with the Securities and Exchange Commission (SEC), usually in connection with the company's initial public offering. A red herring prospectus contains most of the information pertaining to the company's operations and prospects but does not include key details of the issue, such as its price and the number of shares offered. BREAKING DOWN 'Red Herring' A red herring prospectus may refer to the first prospectus filed with the SEC as well as a variety of subsequent drafts created prior to obtaining approval for public release.
Bold Disclaimer The term "red herring" derives from the bold disclaimer in red on the cover page of the preliminary prospectus. Purpose of the Red Herring Prospectus Once the registration statement becomes effective, the company disseminates a final prospectus that contains the final IPO price and issue size. Value of a Red Herring Prospectus to Investors. Equity Financing Definition. What is Equity Financing? Share Video undefined What is 'Equity Financing' Equity financing is the process of raising capital through the sale of shares in an enterprise.
BREAKING DOWN 'Equity Financing' Equity financing involves not just the sale of common equity, but also the sale of other equity or quasi-equity instruments such as preferred stock, convertible preferred stock and equity units that include common shares and warrants. A startup that grows into a successful company will have several rounds of equity financing as it evolves. For example, angel investors and venture capitalists – who are generally the first investors in a startup – are inclined to favor convertible preferred shares rather than common equity in exchange for funding new companies, since the former have greater upside potential and some downside protection.
Burn Rate Definition. Share Video undefined What is 'Burn Rate' Burn rate is normally used to describe the rate at which a new company is spending its venture capital to finance overhead before generating positive cash flow from operations; it is a measure of negative cash flow. Burn rate is usually quoted in terms of cash spent per month. BREAKING DOWN 'Burn Rate' Startup companies and investors use the burn rate to track the amount of monthly cash that a company spends.
Gross Burn vs. There are two types of burn rates: net burn and gross burn. So, if a technology startup spends $5,000 monthly on office space, $10,000 on monthly server costs and $15,000 on salaries and wages for its engineers, its gross burn rate would be $30,000. This is a very important distinction, because it affects the amount of money a company has in the bank and therefore its financial runway.
Bootstrapping - Small Business Encyclopedia. Definition: To finance your company's startup and growth with the assistance of or input from others . Anyone who's started a business on a shoestring is adept at bootstrapping, or stretching resources--both financial and otherwise--as far as they can. But bootstrapping isn't limited to the startup state. It's a valid way for business owners to treat valuable resources at any stage of their business' growth. Bootstrapping is one of most effective and inexpensive ways to ensure a business' positive cash flow.
Bootstrapping means less money has to be borrowed and interest costs are reduced. Looking for ways to bootstrap your business? But using trade credit on a continual basis is not a long-term solution. Depending on the terms available from your suppliers, the cost of trade credit can be quite high. Factoring is another way to stretch your money. Customers can also help you obtain financing by writing you a letter of credit. 1.
Keep a close watch on operating expenses. What is Bootstrapping? The Percent-Of-Sales Method of Financial Forecasting. Pro Forma Definition. Forecasting Definition. Why You Need to Include Assumptions With Your Financial Projections - ProjectionHub. What Are the Financial Assumptions on a Business Plan? 10 Things to Outsource to a Virtual Assistant. Innovation Skills Profile 2.0 - Centre for Business Innovation. Understand the real skills profile of your company | TeamFit Blog. Kap9primerentrepreneuruka. The Liability of Newness and Small Firm Access to Debt Capital: Forbes Welcome. Advisory Boards - Small Business Encyclopedia. Founders’ Agreements – Startup. Ethical Dilemma Examples. What Causes an Ethical Dilemma in Conducting Business?
Differentiation - Are Product, Brand and Service Still Enough? | B2B International. Company’s Core Strategy: 2 Main Objectives of Company’s Core Strategy. How To Create A Disruptive Business Model. Churn Definition - What is Churn in a subscription. Target Market - Small Business Encyclopedia. What is a Landing Page? Purdue OWL. Primary and secondary research - Market research and consumer protection - Food Standards Agency | Food Standards Agency case studies and information.
What is a Feasibility Study? | Ag Decision Maker. Solo Entrepreneurs. 4 Differences Between Solopreneurs and an Entrepreneur Working Alone. The three pieces of entrepreneurship: opportunity recognition, opportunity assessment, and opportunity realization - The Berkeley Science Review. Danger Zone: Are you Ignoring your Opportunity Gap? Business Magazine | BABM l Business Building | Opportunity Gap Analysis.
Reasons to Become an Entrepreneur. 16 Reasons Why People Become Entrepreneurs. Forbes Welcome. Forbes Welcome. Business Futures Blog | Blog from a technology industry entrepreneur and academic about the learnings and experiences in today's business environment. 4 Advantages and Disadvantages of Entrepreneurship. 5 Key Characteristics Every Entrepreneur Should Have. Entrepreneurship: A Working Definition. What is entrepreneurship? definition and meaning. What is Entrepreneurship? | Entrepreneurship Definition.