16 Analyse how a lack of brand reputation can be a major problem for a new business.

[Sir Afzal Shad]

16 Analyse how a lack of brand reputation can be a major problem for a new business. [3]
Hint: Customers lack trust > They are unwilling to try an unknown product or service > This makes it very hard to generate initial sales.

[Abdullah Baig]

Kn
A lack of brand reputation can be a major problem for a new business because customers are less likely to trust unfamiliar brands
App
For example, when a new clothing store opens, customers may hesitate to buy from it since they are unsure about the product quality or reliability leading them to continue purchasing from well known competitors instead which makes it difficult for the new business to attract customers and generate initial sales
An
Therefore, without a strong brand reputation, new businesses struggle to build customer trust, making it harder to establish a stable customer base and achieve growth

[Aarib Saad]

(KN)Customers will be more reluctant to buy from an unknown business.
(APP)In the case of for instance, a restaurant, since many people have their defined comfort foods/dishes, most people are unwilling to spend money on a restaurant whose food they don't know whether they will like or not.
(AN)Thus, making it so that a new business will have to spend funds on adverts and other measures to attract customers, which will worsen cashflow, thus making survival for a new business that is unknown difficult.

[Fatima ibtehaj]

[KN]A lack of brand reputation can be a major problem for a new business because customers are often hesitant to buy from a brand they don’t recognize or trust.
[APP]For example, a new smartphone company might offer good-quality phones, but most customers will still prefer well-known brands like Samsung or Apple because they trust their quality and customer service.
[AN]Without a strong reputation, the business may find it difficult to attract customers, charge higher prices, or compete effectively in the market which can lead towards a rise in economies of scale making it difficult for the business to manage their cashflows effectively.

[shamaim shakeel]

[KN] Brand reputation is how well-known and trusted a business is in the eyes of customers. A new business often lacks this reputation because people are not yet familiar with its products or quality.
[APP] For example, a new skincare company may struggle to attract customers who prefer wellknown brands they already trust, like Nivea or Dove.
[AN] Without brand reputation, customers may hesitate to buy or may choose competitors instead, leading to low sales and slow growth. This also makes it harder for the business to charge higher prices, build loyalty, or secure partnerships, which can delay its success and make survival more difficult.

[EmmanWaseem]

The customers will not trust the business
They will not buy products that are unknown and has low reputation
That is why they can not increase the initial sales which will increase the cost and lower the revenue

[Naveen fatima]

[KN]New businesses often start with little or no public recognition.
[APP]For example, a new phone company may find it hard to attract customers when well-known brands like Apple and Samsung already dominate the market.
[AN] A lack of brand reputation is a major problem because customers are less likely to trust an unknown business. This can lead to lower sales as people prefer to buy from brands they recognise because it's reliable for them.It also means the business must spend more on marketing to build awareness, which increases costs and makes it harder to compete with established firms.

[Muaz Aamir]

[KN] Brand reputation is about how well known and trusted a business is by customers.

[AP] For example, a new phone company won’t be trusted as much as big names like Apple.

[AN] Without a good reputation, people might not want to buy from it leading to fewer sales and slower growth and the business might have to spend a lot on marketing just to convince people to try its products.

[Arham Qadri]

[KN] Because the customers will be reluctant to buy from brands/business that are unknown.
[APP] For example people are unwilling to spend money on a fast foot restraint that they have not tried or don't know about.
[AN] Hence the business will spend more money on advertisement which will decrease cash flow and make survival of the business difficult.

[Abdullah Mohsin]

[KN] Lack of customer trust
[APP] For example, a new mobile company launches its first ever smartphone, customers may hesitate to purchase from the new brand as they would prefer the well known brands like Samsung and Apple, making it difficult for the new business to sell its products as customers would opt for the brands that have been in the market for a long time.
[AN] Hence, this forces the business to spend more on promotions like free charging bricks and wires for a limited time which could help sell some phones but may lead to loss as the business would be spending more than it is earning.

[abdurrehman waseem]

KN: Brand reputation builds customer trust.
App:For example,A new smartphone company might struggle to convince customers to choose it over Apple or Samsung.
An: Without a strong brand image, customers may doubt product quality, resulting in low sales and difficulty establishing a foothold in the market.

[Aayan Zaidi]

KN: Brand reputation is how well customers know and trust a business. New businesses don't have this yet.
APP: E.g customers may choose Coca-Cola over a new drink brand because they trust it more.
AN: So, without a strong reputation, a new business may struggle to attract buyers and build customer loyalty.