Question 1.1
Is Ms. Somying’s business an SME or a STARTUP? Why? (20 marks)
Ms. Somying's business can be classified as a startup. A startup is typically characterized by innovation,scalability, and potential for rapid growth. Ms. Somying launched a new
product, ready-to-eat fruit salads made from 100% organic ingredients, which suggests an innovative approach in the food market. Moreover, her business is in the early stages,
having just launched in small supermarkets after a market test. The emphasis on gradually
scaling the business and collaborating with institutions to develop technology for
enhancing production capacity are also indicators that her business is focused on growth and scalability, which aligns with the characteristics of a startup.
Question 1.2
Tell one possible advantage and one possible disadvantage of Ms. Somying’s business operations. Why? (5 marks)
· Advantage: One possible advantage of Ms. Somying’s business is the use of 100% organic ingredients, which aligns with current consumer trends favoring healthy and natural foods. This can attract a loyal customer base concerned with health and
sustainability, giving her a competitive edge in the market.
· Disadvantage: A potential disadvantage is the heavy reliance on human labor for
production, which can create bottlenecks in the production process, especially if there is a sudden increase in demand. This reliance could limit the ability to scale rapidly
without significant investment in automation or additional training.
Question 1.3
Tell two positive qualities of Ms. Somying as an entrepreneur. Why? (5 marks)
1. Innovativeness: Ms. Somying demonstrates innovation by introducing a new product —ready-to-eat organic fruit salads—into the market. Her ability to identify and
capitalize on the growing demand for healthy food options showcases her creativity and forward-thinking mindset.
2. Persistence: Ms. Somying’s willingness to invest her own capital and go through a
market test before a full-scale launch indicates her persistence and commitment to her business. This trait is crucial for navigating the challenges and uncertainties associated with running a startup.
Section 2: Read each factor and decide whether it is internal or external and whether it is positive or negative. (14 marks)
Here are the classifications:
2.1 Economic downturns affecting consumer spending on non-essential items: External, Negative
2.2 Excellent sales staff with strong knowledge of existing products: Internal, Positive
2.3 Changes in government regulations that benefit the industry: External, Positive
2.4 Market research data may be out of date: Internal, Negative
2.5 Strong investor backing: External, Positive
2.6 Entry of new competitors in your market: External, Negative
2.7 Limited budget for marketing and business development: Internal, Negative
2.8 Political instability or changes in government policies: External, Negative
2.9 When interest rates are low, businesses may borrow and invest more: External, Positive
2.10 Increasing interest rates: External, Negative
2.11 Being able to produce goods/services at a lower cost than competitors: Internal, Positive
2.12 New technologies that can disrupt the industry: External, Negative
2.13 Manufacturing processes are efficient: Internal, Positive
2.14 Similar products on the market are not as reliable or are more expensive: External, Positive
Section 3: Read each alternative and identify whether it is a strength, weakness, opportunity, or threat.
Here is the classification:
A. Expanding catering for events and businesses: Opportunity
B. Negative online reviews and comments impacting the coffee shop’s reputation: Threat C. The coffee shop offers a relatively small menu with minimal food options, limiting
potential revenue streams: Weakness
D. The coffee shop is situated in a high-traffic area, offices, and tourist attractions, leading to increased foot traffic and sales: Strength
E. Health-conscious trends may reduce the demand for traditional coffee products, affecting sales: Threat
F. Maintaining high-quality ingredients and skilled staff leads to higher operating costs, impacting profitability: Weakness
G. The coffee shop is known for serving high-quality, locally roasted coffee that has built a loyal customer following: Strength
H. Economic recessions can lead to reduced consumer spending on premium coffee products: Threat
I. Partnering with food delivery apps and offering online ordering to tap into a broader customer base: Opportunity
J. The shop’s interior design and seating arrangements create a cozy and inviting atmosphere, encouraging customers to stay longer: Strength
K. The area is seeing a growing number of established competitors and trendy cafes, intensifying competition: Threat
L. Limited parking availability deters some potential customers from visiting: Weakness
