Question

An entrepreneur has purchased rights to produce and sell an innovative new product. She has limited start-up funds for the business. Should she open an e- business or a traditional store?

Answer 1

Answer:

An e-business or an e-store

Explanation

An Entrepreneur (or a one- man business) is a person who attempts to solve a problem or need by setting up a business (or businesses) with the aim of solving that problem or need.

An entrepreneur takes all the profit if the business succeeds and bears all the losses and risks if the business fails.

Start-up capital (the money required to start a new business) is one of the factors of production. Others include labour, land etc

Opening a traditional store entails renting or buying a physical store to sell the new products and it involves using money which is limited in this scenario, so opening an e-store (e-business) would be an innovative way to sell the innovative new products without spending so much money/capital.

Answer 2

Answer:

e-business can reduce costs

Explanation:

A traditional stores requires trained staffs which are responsible for selling, explaining products and for costumer's orientation. In order to keep those sellers, is necessary to have training, management and salary incentives. The advertising of a certain product in the internet can work as a proper seller, but without the physical experience of handling the product and real time testing.

The environment from the traditional store can be shrinked to a simple deposit, allowing more space for products, instead of a customer area from a traditional store, where commonly has to be adapted for a marketing architecture. By that, is possible to cut costs of renting a big and well located area. By using a e-business, the company human resources can be reduced to a small crew of telephone and/or computer operators, therefore reducing the amount of workers.