1.3 putting a business idea into practice Flashcards
why is survival a aim
it is short term as new businesses struggle to survive
why is maximizing profits a aim
wealth
why is increasing market share an aim
to establish itself as a main market leader
why is maximizing sales a aim
increase market share
why is achieving financial security a aim
to start with may depend on loans so a aim might be to be financial secure
non financial aims
personal challenge
personal satisfaction
independence
whats right for society
what is the difference between aims and objectives
objectives are specific and aims are general
how size of a business effects you aims and objectives
small businesses may focus on survival
big companies may focus on increasing sales and market share
how the type of owner affects the aims and objectives
one person or few may focus on personal satification
big company’s with share holders may focus on maximizing profits
how level of competition affects aims and objectives
highly competitive market focus on survival
less competition may focus on market share and profits
what two types of aims are there
financial
non financial
main day to day cash payments
supplier, salaries, rent
ways to improve cash flow
cut stock levels
increase credit
reduce credit to customers
why does cash matter
building delays or cost overruns may turn cash balance into deficit
how cash should be managed
negotiate overdraft
keep costs under control
keep cash coming in
