3.1 Flashcards
what is a mission statement?
sets out the purpose of the business (why it exists)
what are corporate objectives?
quantify the mission of a business and set measurable targets for the whole organisation
what are internal factors affecting corporate objectives?
- poor performance
- new leadership
- business ownership
- business culture
- business growth
what are external factors affecting corporate objectives?
- economic conditions
- social change
- actions of competitors
- global prices
- technological change
what are strategies?
medium to long term plans made by a business to meet its corporate objectives
what is meant by corporate strategy?
the course or route that a business has chosen to follow in order to achieve its corporate objectives
what does the Ansoff matrix look into?
the degree of risk and potential for reward from different strategic options
what are the 4 potential strategies in the Ansoff matrix?
- market penetration
- market development
- new product development
- diversification
what is market penetration?
trying to sell more of an existing product to the existing market
what is market development?
attracting new customers to buy existing products
what is product development?
selling new and better products to existing customers
what is diversification?
selling new products to new markets
what is porters strategic matrix?
a matrix that categorises the marketing strategies a business can adopt to try and achieve a competitive advantage
what are the four strategies of the generic strategy?
- cost leadership
- differentiation
- focused cost leadership
- focused differentiation
what does a product portfolio analysis do?
looks at the range of products and brands that a business has under its control
what does ‘SWOT’ stand for?
strengths, weaknesses, opportunities, threats
are the strengths and weaknesses internal considerations?
yes
are the opportunities and threats external considerations?
yes
what is SWOT analysis?
a diagnostic tool used to identify the internal strengths and weaknesses and the external opportunities and threats to a business
what does ‘PESTLE’ stand for?
Political, Economic, Social, Technological, Legal, Environment
What is ‘PESTLE’?
a way of identifying the potential external influences on a business
what is regulation?
something undertaken by the government to create competitive markets
what is de-regulation?
the opening up of markets to new competition through the removal of rules and regulations that created barriers to entry
what are porters five forces?
- rivalry within the market
- bargaining power of suppliers
- bargaining power of buyers
- threat of new entrants
- threat of substitutes
what does the porters five forces model do?
analyses the key issues facing a business
what is rivalry within the business?
the level of competition and rivalry between businesses within the market
what is bargaining power of suppliers?
the power suppliers have to negotiate terms and prices
what is bargaining power of buyers?
the power buyers have to negotiate terms and prices
what is threat of substitutes?
the threat of new alternative products that deliver the same benefits to the customers
what are barriers to entry?
the factors that stop a firm from entering the market
