1.5 Understanding External Influences on The Business Flashcards
What is a stake holder?
Any individual or group that has an interest in the activities of the business.
Each business ___________ will have a different ________ and is affected in ________ ways by the business.
stakeholder; objective; different
What are the problems of the different stakeholders?
They have interests that conflict with each other, which can be hard for the business to meet them.
What are the 8 different stakeholders a business can have?
- Shareholders
- Employees
- Customers
- Managers
- Suppliers
- Local community
- Pressure groups
- The government
What are shareholder objectives?
- ensure that the business is successful
- interested in the amount of profit the business can make
What are employee objectives?
- good level of pay
- job satisfaction and security
- may be interested in career progression
What are manager objectives?
- good salary
- job satisfaction and security
- opportunities for career progression
What are customer objectives?
- good quality products
- a range of products at reasonable prices
What are supplier objectives?
- receive payments on time
- receive regular orders
What are local community objectives?
- people in the local community want jobs which the local business can provide
What are pressure group objectives?
- they want to increase the knowledge of their cause
- they want the business to behave in an ethically and environmentally friendly manner
What are government objectives?
- want businesses to create more jobs so that they can collect more taxes + save money on benefit payments
How does business activity affect shareholders/owners?
- may decide to open new stores + sell more products
- may expect to see more profit within the coming years
- however, this costs money so may see a shortage of profit or even a loss in the short term - affects dividends
How are managers affected by business activities?
- take up additional responsibilities and set new targets
- may be given opportunities for career progression - could be demotivated if not given
How are employees affected by business activity?
- Business growth increases job security
- also have opportunity for promotion - some employees may feel resentful if not offered opportunities.
How will customers be affected by business activities?
- benefit from having more choice where to shop if more businesses are present
- can be tempted to try them out if business is no longer meeting customer needs and wants
How will suppliers be affected by business activities?
- increased orders
- but if there is an inability to meet demand, the business may try out other suppliers instead.
How will the local community be affected by business activities?
- new stores + expansion is likely to bring out new jobs
- unhappy if more traffic + noise is created.
How will pressure groups be affected by business activities?
- may protest against expansion/ new stores if their cause is adversely affected.
How will the government be affected by business activities?
- may be pleased to see new jobs being created and increases in tax revenues
- other businesses could lose customers, reduces profit + tax collected.
