IGCSE, A Level Business Student Forum

9. Analyse possible advantages of adding value to a business. [6]

Possible Structure:
[KN]
[AN]
[AN+]

[KN]
[AN]
[AN+]

[KN]Adaptability to market changes as added value requires deep understanding of consumer base
[AN]this would allow them to stay relevant in the market
[AN+]this builds customer loyalty and helps sustain the business in the long run

[KN]adding value requires continuous innovation and improvement
[AN]this increases employee morale as they take pride in their work
[AN+]which leads to higher productivity

[KN]More profits
[AN] Due to the business making a product that meets the consumer's preferences even better they would be able to charge a higher price for it cause the product has gone through the process with enhances the convenience of using that product
[AN+] Thus this would allow the business to sell the product for a higher price cause it has been modified and serves all of its purposes with utmost effectiveness (productivity)

[KN] Brand loyalty improved
[AN] Through offering a product that has quality at the lowest price possible the customer would be willing to buy from the same business as he believes that the business is serving its purpose of giving them a product that they are demanding
[AN+]Since the consumer chooses to remain close to the brand even when the business launches a new variation of a product or a whole new product they have already developed there potential customers who would be willing to buy from them instead of competitors giving the a competitive head from there competitors in the local market

[KN] Greater profit margins.
[AN] Businesses adding more value to their goods and services can charge higher prices as it increases the efficiency of the good or service.
[AN+] Thus it will increase profits as adding small details can lead to a greater impact and if that detail is in demand, businesses can charge even higher prices.

[KN] Improved Competitive Advantage.
[AN] By adding value to products or services, businesses can differentiate themselves from competitors and create a unique selling point (USP).
[AN+] Thus the USP will help them generate more sales and have a competitive edge as added value will make their product better.

[KN] Extension of product life cycle
[an] Value addition includes adding processes to production process and adding new features to the product
[an] Thus this may help to attract more potential customers and increase sales of a product


[KN] Improved Quality
[an] Added value includes improving quality(better quality raw material may be used) which may help to maximize customer satisfaction
[an] Therefore, this can lead to high customer loyalty and improved brand image.

[KN]Business can gain competitive edge
[AN]When value is added to products the product differentiate itself from competitors and creates a USP
[AN+]This will boost their sales and may encourage expansion

[KN]Improved quality
[AN] Added value leads to better quality raw material used for each product which improves quality of product and the product meets customer demands
[AN+]This may lead to customer and improved brand image

KN: Improved Brand Reputation
AN: Offering additional value can enhance a business's reputation
AN+: making it more trustworthy and respected in the eyes of consumers

KN: Innovation
AN: adding value encourages innovation and continuous improvement
AN+: Thus leading to growth of the business

[KN] Standing out from competitors products.
[AN] By adding value to the products which distinguish them from competitors product will provide the business
with the opportunity to charge premium prices as customers are attracted and so willing to pay high prices
[AN+] Thus this will ensure a smooth drive for the business with greater market share and revenue.


[KN] Maximizing customer equity
[AN] It means representing the total lifetime value of all the company's customers. Adding value will encourage
the customers to continue to buy the business products and services which will lead to customer loyalty and spread of positive
word of mouth about the business.
[AN+] Thus this lead to increased brand image and a powerful marketing position.

[KN] adding value to a business leads to innovation as businesses aim to improve thier processes
[AN] creative ideas give edge to the business in a competitive market
[AN+] this leads to a higher number of customers helping the businesses increase its market share and become market leaders

[KN] adding value to a business may decrease costs as firms would focus on improving it it’s processes play example by investing in advanced technology
[AN] this leads to greater productivity as more output it is produced in lesser time and lower costs
[AN+] allows businesses to charge the lower prices while keeping profits as well as helping the business differentiate itself from other competitive businesses

(Kn) higher profits (an) adding value gives them the green light to charge a higher price accordingly (an+) this will increase the revenue further increasing profits
(Kn) better quality (an) a value added product will have a better and more suitable quality which meets consumers demand(an+) improving brand image due to such quality provision and customer satisfaction

[KN] Increase in market share.
[AN] Businesses adding value to its product can help increase the market share.
[AN+] Leading towards the improved brand image.
[KN] Increase in the growth of a business.
[AN] By adding value, would help to increase the profit making the business grow faster.
[AN+] This would help in staying more competitive in the market.

[KN] by adding value to certain products and services the quality will be improved
[AN] allowing the business to increase prices
[AN+] earning a larger amount of profit
[KN] this also helps businesses stand out in competition
[AN] by having a superior value product businesses can outperform the competitors
[AN+] giving a competitive advantage as customers are more attracted to our product increasing sales

[KN] Cost Efficiency
[AN] Some value added feature such as process improvements can help reduce operational costs and increase efficiency.
[AN+] This can contribute to higher profitability.

[KN] Improved quality
[AN] added value leads to better quality raw material used for each product which improves quality of product and the product meets customer demands.
[AN+] thus leading to brand image as customers would be satisfied

[KN] Higher profits.
[AN] Adding value gives them the green light to charge a higher price accordingly.
[AN+] This will increase the revenue further increasing profits.
[KN] Cost Efficiency
[AN] Some value added feature such as process improvements can help reduce operational costs and increase efficiency.
[AN+] This can contribute to higher profitability.

[KN] Higher sales than competitors
[AN] as due to extra thing offered by us is not given by any other.
[AN+] attract customers and increase market share.

[KN] Higher profits
[AN] Adding value gives them the green light to charge a higher price accordingly.
[AN+] This will increase the revenue further increasing profits.