1.5-entrepreneurs/leaders

Question 2

What is an entrepreneur?

Answer 2

Is a person who sets up a business and takes risks in hope for a profit or reward

Question 3

What are the steps of setting up a business?

Answer 3

1- market research and finding out what consumers want
2-start a small stall/ something similar
3-draw up a business plan
4- grown the business

Question 4

What is the running of a business?

Answer 4

The day to day tasks to keep the business going
This may include completing finances, buying stock, contacting customers and changing payments

Question 5

How can you expand a business?

Answer 5

-open another location
-offer the business as a franchise
-targets other markets
- merge with another business

Question 6

What is an intrapreneur?

Answer 6

An employee within the business who thinks like an entrepreneur
-takes risks
-creative/innovative
-solve problems
-understand trends
-self confident

Question 7

What are the barriers to entrepreneurship?

Answer 7

1a entrepreneurial capacity
2-access to finance
3-lack of training
4-fear of failure
5- lack of confidence

Question 8

What is entrepreneurial capacity?

Answer 8

-growing awareness that entrepreneurial skills knowledge and attitudes can be learned and lead to an entrepreneurial mindset.
Lack of this capacity can be a barrier

Question 9

What is access to finance?

Answer 9

Many entrepreneurs cannot start a business due to a lack of funding
- may not have savings or family to help
-many banks don’t lend to start ups due to a lack of data- makes them a risky investment

Question 10

What is a lack of training?

Answer 10

• many people don’t know how to start up a business
  Don’t have the skills/ training to start yp

Question 11

what is fear of failure?

Answer 11

Many entrepreneurs don’t start up as they fear failing
-may be failing itself of the cost of failing that put users off
-especially if they give up their regular job

Question 12

what is lack of confidence?

Answer 12

Many people lack the confidence to start up a business
Can be overcome with training, information and marketing, and when they are sure they have a product that will sell increases their confidence

Question 13

What is a risk?

Answer 13

The possibility that the business won’t make a profit or make a loss

Question 14

What is a financial risk?

Answer 14

The owner may put their own cash or assets into starting a business
if they are a sole trader, they have unlimited liability meaning their could lose their personal assets to pay business debts

Question 15

What is a lack of security?

Answer 15

If an entrepreneur decided to leave their regular job to start a business, this is a risk

Question 16

What is uncertainty?

Answer 16

When a business is unable to predict external shocks or future events

Question 17

What is an entrepreneurial characteristics?

Answer 17

The skill, quality or trait of the person starting the business
1-creative-help design new products
2-hard work-need to put in effort to get the business established
3-resilient-you may get knock backs before your business is a success
4-initiative
5-self confident-you need to be confident about your business or you are likely to give up
6-risk taking-financial risk of losing money if the business fails

Question 18

what is a motive?

Answer 18

the factor that drives a person to start a business

Question 19

what are the 6 entrepreneurial skills?

Answer 19

1-communicate
2-problem solving
3-team work
4-organised
5-it
6-numeracy

Question 20

financial motives?

Answer 20

1- profit maximisation- aim to make the most profit and keep costs down
2-profit satisficing- make enough profit to keep owner satisfied, as well as another objective

Question 21

non financial motives

Answer 21

1-independence
2-flexiblity
3-social reasons
4-ethical reasons
5-personal challenge

Question 22

profit maximisation

Answer 22

shrinkflation-owner makes the product smaller but keeps the price the same

Question 23

sales maximisation

Answer 23

aim to get as many sales as possible
profit figures are annual but sales are weekly-easy to compare
-salaries are linked to sales

Question 24

employee welfare

Answer 24

employers seek good relationship with employees
does this by providing incentives
can be internal-uniform, canteen, breaks
or external-holidays, insurance , education
this improves employee satisfaction- more likely to remail loyal and be productive
also gives business a good image

Question 25

customer satisfaction

Answer 25

you understand customer wants and needs and fill it
-less complaints
customer centred approach means
repeat sales- brand loyalty
good word of mouth
good brand image

Question 26

market share

Answer 26

important factor in a competitive environment
good for investors to judge against other businesses in the market
a loss of market share can lead to long term financial issues

Question 27

cost efficiency

Answer 27

-try get costs to a minimum
can be done through;
-paying employees minimum wage
-subcontracting work out
-reducing quality of a product

Question 28

social objectives

Answer 28

corporate social responsibility
-can create a USP or improve brand image
can be through:.
being environmentally friendly
paying fair wages
helping society

Question 29

limited liability

Answer 29

this is where the owner and the business have separate legal identities so the owner is not responsible to pay back any debts

Question 30

unlimited liability

Answer 30

the owner is responsible and their personal assets may be used to repay debts if anything goes wrong

Question 31

sole trader

Answer 31

one owner, but can have employees
+ve
keep all the profits
make all decisions
easy and quick to set up
own boss
-ve
harder to raise finance
unlimited liability
no one to share risk/ideas with

Question 32

partnership

Answer 32

2 or more people who run a business
have a deed of partnership
can have ‘sleeping partners’-invest but arent involved in the running of the business
+ve
more people so more ideas and capital
easier to raise finance
share risks
-ve
may have disagreements
profit is shared
unlimited liability

Question 33

private limited company

Answer 33

can sell shares to friends and family
+ve
-can raise capital
-limited liability
-ve
limits capital as you cant sell on the stock market
-time consuming as you need to do paperwork

Question 34

franchising

Answer 34

where an entrepreneur sets up a business with an established business name
franchisee; person buying the rights
franchisor: person selling the rights
+ve
franchisor chooses franchisee carefully
also choose investment amount
provide support, training and management advice
-ve
franchisee never owns the business outright
no freedom of running own business
pay in royalties

Question 35

public limited company

Answer 35

when a LTD needs further investing, it will transition into a PLC.
PLCs benefit from stock market flotation as they can sell shares for anyone to buy
however, they need to generate higher profits to pay dividends
share price is influenced by global/national economy and supply an demand
business needs to issue a prospectus to attract potential investors

however going public is expensive:
-time consuming
-alot of paperwork needed
-need over £50,000 in share capital

Question 36

social enterprise

Answer 36

a business that is set up for a social/ environmental purpose
uses its profits to benefit society in some way
-not a charity that relies on donations, however can get government grants/funding

Question 37

online business

Answer 37

a business that operates over the internet
-can be managed from anywhere- good work life balance
-easy to set up and manage
-available 24/7
can be technology issues

Question 38

lifestyle business

Answer 38

uses profit satisficing and gives the owner a good life
owner hopes to sustain a certain level of income
allows them to live how they want whilst doing something they enjoy

Question 39

opportunity cost

Answer 39

land labour capital are all limited resources- causes scarcity

the sacrifice a business makes when choosing one thing over another

Question 40

trade off

Answer 40

less of one thing is exchanged for more of another - compromise

Question 41

entrepreneur to leader

Answer 41

1- learn to delegate so owner can focus on more strategical areas of the business
2-listen to others and take their opinions into account
3-trust others to do tasks to a high quality