AQA BUSS1 Planning and Financing a Business

Starting a Business - 1.2 Generating and protecting business ideas

Assessment 1.2 Generating and protecting business ideas

 Sources of business ideas

 The identification of a product or market niche
 Franchises
 Copyright, patents and trademarks

ConcertLive
Adam and James were young, passionate about music and regular concert goers. One night they had argued over the
last track played at a Massive Attack concert they had recently attended. They decided that it would have been great
if they could have listened to the concert again to settle their argument. The following day they discussed how this
idea could be put into practise with a facility to provide a live CD recording minutes after a concert has finished. They
did not know of anyone else who provided this service. It was a market niche. They thought it would be great if you
could take home a unique copy of the actual performance that you had attended. Although very excited about the
idea they were also concerned that the cost and technical knowhow needed to record and produce the CDs might be
prohibitive. They were both fresh out of college and resources were limited.

Adam and James knew that limited resources were not their only issue; there were also a lot of legal considerations.
Adam knew that music companies and artists were fighting a constant battle against illegal downloads and
bootlegging (the illegal recording of a performance). Copyright law meant that musicians were protected against
such crimes. However, this did not stop them from happening. Illegal activities were commonplace outside every
concert. It was easy to pick up t-shirts with band logos on that were registered trademarks. If Adam and James’
venture was to be successful they would also need to protect their own business. This included the idea, the name
“ConcertLive” as well as the CDs produced at the concerts. What would make them different is that everything they
produce would be exclusive and limited edition.
Adam and James’ first obstacle was going to be convincing the music companies that their product would benefit the
artists and improve the experience of concert goers. ConcertLive’s first recording was for a band called The Gang of
Four. They sold 350 CDs. Sales in their first full year, 2006, were £280 000 and by 2008 they had reached £1 million.
Soon, they had signed contracts with the top four UK recording companies. Major established artists such as Elton
John, Keane and Tom Jones were involved in the venture.

As the business grew they were always looking for new ways of making money. A website was developed and this
helped to improve on their after sales service. Customers could now download a copy of the concert track list, with a
list of all the songs that had been performed. Expansion into Europe followed. The possibility of franchising was
discussed. This would allow them to develop the product worldwide. However, problems might occur with
maintaining their high quality recording process and loss of some control over decision making. They had built a good
reputation and did not wish to lose it.
Adapted from www.concertlive.co.uk

Question 1
a. All enterprises start with the generation of a business idea:
(i) How did Adam and James come up with their business idea? (1 mark)
(ii) State one other source of business ideas. (1 mark)
b. What is meant by the term “market niche”? (2 marks)
c. What is meant by the term “trademark”? (2 marks)
d. Calculate the percentage market growth from 2006 to 2008. (3 marks)
e. Explain why limited resources might be a problem to Adam and James in setting up ConcertLive (6 marks)
Question 2
a. Analyse the benefits of Adam and James protecting the business ideas, name and products.
(10 marks)
b. To what extent do you agree that franchising would be the best way to expand the business?
Justify your view. (15 marks)
Total 40 marks

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