1.what Is Buisness Flashcards
And all 4 business functions
HR,marketing, finance , operations
Mission
Aim of business that is settled upon by owner
Aim
General statement of where the business is heading
Why do business set objectives
Motivating, having a clear goal
Profit optimisation
Surplus of revenue over costs should be just right neither too high in short term nor low to finance long term
Profit maximisation
Make as much profit as possible
Delegated
Passing authority down the hierarchy so that local or more expert person makes the decision
Mission statement
Short and powerfully expressed sentence or two that explains the business aims clearly yet motivationally
Objectives
Targets Precise enough to allow praise or blame for person in charge
Strategy
Medium -long term plan for meeting objectives
Interest
Cost of borrowing and reward for saving
Smart
Specific
Measurable
Achievable
Realistic
Timed
Benefits of business
Create employment
Innovate
Pay taxes to government
Create wealth
Help the world
Tactical objectives
Focused on short term and low risk and realistic and achievable
Unincorporated
Sole traders and partnerships
UnLimited liability
Owner is the business
Incorporated
PLC
LTD
Limited liability
Legal difference between owners and business
Pros of sole trader
Quick and easy to set up, the business can always be transferred to a limited company once launched
Simple to run, owner has complete control and over decision making and it’s easy to close and shut down
Minimal paperwork 
Cons of sole trader
Unlimited liability
How to raise finance
The business suffers if the owner becomes ill owners interest
Can pay a higher tax rate than a company
Company
Illegal entity for owners of a company are shareholders
Benefits of limited companies
Limited liability
Easy to raise finance
Stable formal structure, business continues to exist, even when she holders change
Cons of Limited, companies
Greater admin costs
Public disclosure of company information
Directors legal duties 
Public sector companies
Whereas small number companies are owned or controlled by the government for example network rail RBS
Public sector organisations
There are many more organisations that provide goods and services which are owned and I’ll by public bodies
Funded by central local government
For example, NHS high agencies 
Not for profit organisations
Businesses that trade in order to benefit the community, the businesses have social aims as well as trying to make money 
Demand
The amount of a product of service that customers are prepared to buy
Costs
Amount that a business incurs in order to make goods and or provide services 
Two main ways to increase revenue
Increase quantity sold and achieve higher selling price 
Examples of variable cost
Raw materials, wages, marketing costs ,bought in stocks 
Examples of fixed cost
Rent and rates salaries, advertising insurance, and banking software, design and development
Profit
Rewards or return for taking risks and making investments
Two ways to measure profit
Profit absolute terms and profit relative terms
Stakeholder 
A stakeholder is any individual or organisation who has a vested interest in the activities and decision-making of a business
Internal stakeholders
Employees and shareholders and owners
Connected shareholders
Customers, suppliers and creditors 
External shareholders
Competitors, government and society/community
Profit warning
Mark expeditions will not be met, almost always result in a significant full and share price 
Two methods of issuing shares for a public company
Flotation and rights issue Rights issue is the new shares given to existing shareholders to have the right subscribe for the new shares at significant discount price
Flotation is stock exchange, 
