1.5 Entrepreneurs And Leaders Flashcards by Annabelle Trappett

What are the 3 stages that entrepreneurs go through when starting a business??

Creating & setting up a business
Running and developing a business
Bringing innovation

How well did you know this?

Not at all

Perfectly

What are the 3 sources of business ideas??

Business experience
Personal experience
Observations

How well did you know this?

Not at all

Perfectly

What are 3 barriers to entrepreneurship??

Support and finance
Lack of confidence
Lack of knowledge

How well did you know this?

Not at all

Perfectly

What are 3 ways of overcoming risk??

Take calculated risks
Keep generating new ideas
Spread risk by diversifying

How well did you know this?

Not at all

Perfectly

What are 3 uncertainties of owning a business??

Health scares
Political factors
Changes in legislation

How well did you know this?

Not at all

Perfectly

What are 4 entrepreneurial characteristics??

Initiative
Hard-working
Risk-taker
Creative

How well did you know this?

Not at all

Perfectly

What are 3 entrepreneurial skills??

Communication
Numeracy
Organisation

How well did you know this?

Not at all

Perfectly

What are the 2 financial motives of owning a business??

Profit maximisation
Profit satisficing

How well did you know this?

Not at all

Perfectly

What’s profit satisficing??

Making enough profit but not pushing to maximise it
Have enough to have an enjoyable lifestyle (called lifestyle business)

How well did you know this?

Not at all

Perfectly

What are 4 non-financial motives??

Independence (freedom to pursue own ideas and not have a boss)
Flexibility
Challenge
Ethics (setting up a business to tackle ethical issues)

How well did you know this?

Not at all

Perfectly

What’s a social enterprise??

Trade in goods or services for a social purpose

How well did you know this?

Not at all

Perfectly

What’s the triple bottom line??

Profit
People
Planet

How well did you know this?

Not at all

Perfectly

What is a business aim??

Broad target or goal for the long-term

How well did you know this?

Not at all

Perfectly

What is a business objective??

Target or goal set for the short to medium-term to help achieve aim

How well did you know this?

Not at all

Perfectly

What are the 8 business objectives??

Survival
Profit maximisation
Sales maximisation
Market share
Cost efficiency
Employee welfare
Customer satisfaction
Social objectives

How well did you know this?

Not at all

Perfectly

What does SMART stand for?? (in relevance to what business objectives should be)

Specific
Measurable
Achievable
Relevant
Time bound

What is the hierarchy of business objectives??

Mission (most detailed)
Corporate
Functional
Team
Individual (most strategic)

What are the 4 forms of business??

Sole trader
Partnership
Ltd
PLC

What are 3 advantages of Sole Traders??

+ Freedom
+ Get all profit
+ Less paperwork
+ No legal costs for ownership

What are 3 disadvantages of Sole Traders??

Long hours
Limited skills
No cover for sick/holiday days
Unlimited liability

What are 3 advantages of Partnerships??

+ Minimal paperwork
+ Mixed skills & knowledge
+ Specialist skills
+ More potential for capital

What are 3 disadvantages of Partnerships??

Unlimited liability
Conflict
Splitting profits

What’s a Private Limited Company??

The owners have to agree before anyone buys or sells shares

What’s a Public Limited Company??

Anyone can buy shares which are sold publicly on the stock market

What are 3 advantages of Limited Companies??

+ Limited liability + Easier to raise finance + Stable form of structure (if a shareholder or owner leaves, business doesn't have to close)

What are 3 disadvantages of Limited Companies??

- Larger admin costs - Public disclosure of company information - Potential loss of control

What are 2 reasons a business would decide to become a Private Limited Company?? (and 2 reasons why not)

Pros: - More stability - Business looks more professional as an 'ltd' Cons: - Loans are less likely (owner's personal assets aren't at risk so bank may not trust it'll be repayed) - Less profit for each owner

What are 2 reasons an Ltd would decide to become a PLC?? (and 2 reasons why not)

Pros: - More capital - Higher prestige Cons: - Low control over share price (controlled by economy) - Less profit for each owner - Potential loss of control

What is the private sector??

Operated by private individuals and usually for profit

What are Public sector companies/businesses??

Small number of companies owned or controlled by government

What are Public sector organisations??

Organisations owned and operated by public bodies but funded by government

What are 4 different types of business??

- Franchising - Online businesses - Lifestyle businesses - Social enterprises

What are 3 advantages of franchising??

+ Tested & developed + Lower risk + Easier to raise finance

What are 3 disadvantages of franchising??

- Royalties & commission - Restrictions on actions - Less responsibility - Franchisor fails = franchise fails

What are 2 pros and 2 cons of online businesses??

+ Cheap and easy to set up + Can be run from anywhere - Owner may not have necessary IT skills - Technical issues could occur

What are 2 pros an 1 con of lifestyle businesses??

+ Flexibility + Low start-up costs - Limited growth

What's a trade-off??

Having more of one thing potentially results in having less of another

What's an opportunity cost??

The benefit that's given up in order to do something else