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Question 1

internal environment

Answer 1

Reflects the business and what it stands for
Internal facts impact day to day planning, activities and success
- Owners have the most control over
Factors include
- Structure, model/strategy
- People (employees)
- Resources
- Business objective

Question 2

external environment

Answer 2

Consists of factors outside business
Impact either directly (operating) or indirectly (macro) to day to day planning, activities and success

Operating environment : have some control over and have a direct impact to business succuess, decision making and performance

Factors – customers, competitors, suppliers

Macro environment – have no control over, have indirect impact on business success, decision making and performance

Factors – social, economic, political, environmental, international

Question 3

Relationship between internal and external environment

Answer 3

Change in external environment causes change in internal environment

Eg. New trends = new products or change to products

Question 4

Unincorporated business

Answer 4

a business that is one legal entity
e.g sole trader
one owner who owns and runs business
unliited liability, liable for losses
simple and cheap

partnership
same thing but up to 20 owners
governed by a act 1958

Question 5

Incorporated business

Answer 5

Go through a process to establish business as separate entity
Up to 50 private share holders
Common way sole traders and partnerships evolve

Question 6

Social enterprise

Answer 6

A for profit private sector business
Generates income from commercial with intent of achieving social objectives
Reinvests at least 50% of profit back into businesss for social cause’

Question 7

Government enterprise business

Answer 7

Private sector business owned by government
Generates income from trades of goods with services for profit
Provides community services
- Communications, housing, transport, health

Question 8

Facts influencing choice of business structure

Answer 8

Sole trader
Strength – simple, inexpensive, control over, entitled to profits, independence
Weakness – liability, limited to expertise of owner, difficult to have time off,

Partnership
Strength – simple and inexpensive, work can be shared, can take time off
Weakeness – liability, potential for conflict and disagreement, share profit

Question 9

Business model

Answer 9

Main foundation of any business
Captures main idea of how it will access customer base to generate sale, profit, revenue

Question 10

Online business model

Answer 10

A business that carries out main activites and sells product via world web
Does not have a physical business premises
Access customers and sell products 24/7

Question 11

DTC direct to consumer

Answer 11

Direct to consumer business model sells products directly to customers online
Allows direct control to user experience
Face to face

Question 12

Bricks and mortars

Answer 12

Physical establishment which is a store
Carries out commercial activites face to face
Easier to build a relationship with bustomer base
Customer sand see touch and try products before buyin

Question 13

Franchise

Answer 13

Arrangement when a business sells right to distrivute its products and use the business name to others
Creating other stores of the same name

Question 14

Importer, Exporter

Answer 14

Importer purhcases overseas materials and resales it in home country
Exporter sells Australian made goods to overseas customers
Importing enables access to other materials around the world
Exporting enables Australian business to access global markets

Question 15

Purchasing existing business

Answer 15

Buying a already established business that is operating
Beware why it is up for sale, financial health of business, assets and liabitlies, goodwill (reputation of business) seen as a asset and calculated as part of its value when sold

Established customer base, generate sales quickly
Buying a failed business, no garautntee for success, paying for goodwill

Question 16

Establishing new business

Answer 16

Starting from scratch, building the business from the ground up,
Complete creative control over establishing business

Freedom, greater control, no pay for goodwill
Higher level of risk uncertainty,
More work required

Question 17

Business record needs

Answer 17

Any business aiming ot achieve specific objects e.g increase sale and profit or grow and scale business utilize series of business resources.

Any material, componnets or asset used in a business operation to achieve a objective

Question 18

Business resources

Answer 18

Natural resource – any naturally existing material or asset

Labour resource – people who provide skill knowledge effort and experience

Capital resource – tools, buildings, machinery

Question 19

Factors affecting use of business resources

Answer 19

Costs - limits using certain machines
Quality – invest in higher equality materials or equipment / machinery
Sustainability – are natural resources being sourced and used sustianabily
Business needs – which and how many resources do we need

Question 20

Business locations

Answer 20

Where a business is located physically or virtually
Directly affects accessibility to customers as well as suppliers
Significant impact on isilibty and success
Common locations include
Shopping centers, home based, online

Question 21

Factors affecting choice of business location

Answer 21

Proximity – how close to customers / suppliers / competitors
Space requirepments – how large is it
Image – will the location present anapproiprate image of the business

Question 22

Source of finance

Answer 22

A business cannot start without apporopiarte finance or funds

Question 23

Equity

Answer 23

Equity – where the business owner contributes to their own funds/capital or the funds of investors
- Owners personal savings
- Shareholder equity
- Partners money
- Seeking investment from investors

Question 24

Debt

Answer 24

Where business owners obtainfinace in the form of a loan from a bank
Long term – lease
Short term – overdraft
Mortgage – loan secured by property
Lease – pay to use premiss- equipment – etc

Question 25

Facts affecting source of finance

Answer 25

Impact on cash flow, risk, business size structure, terms of fiancne flexibility e.g lon g term debt
Control,
Overall cost

Question 26

Business support services

Answer 26

Provides owners with access to professional services to assist in decision making and carrying out core business activities to successfully grow and establish

Question 27

Legal support services

Answer 27

Business are likely to know all of lrgal requirements when establishing business
Legal support services decide on a ownership structure
Advice around legal formation of business
Business registration
Negotiation and writing up contracts
Representation of court

Question 28

Financial support services

Answer 28

Accounting requires a set of complex skill sna dknowledge, time and attention to fine details
Establishing a financial recording system
Taxation advice
Preprafing financial station e.g profit/loss
Performance measures e.g net profit
Evaluating financial feasibility of a business purchase

Question 29

Technological support services

Answer 29

Technology rapidly grows and owners seek technological support
Establishing a webstite or maintaining
Securing data and information on network
Backing up servers and information
Estbalsihing a network of devices
Making sure software is up to latest date

Question 30

Community-based services / networks

Answer 30

Low cost community baseds support services
Business network allows development of relationships and sahraing of information between businesses or people

Question 31

Business mentors

Answer 31

Has been there and done that
Experienced business person able to guide influence and support new business owners to avoid mistakes that lead to business failure.

Question 32

Business planning analysis tools

Answer 32

Used to determine what the business wants to achieve how it will and who will achieve
Process of esbtalishing a business objects over a period of time through a course of action

Question 33

Level of planning and the process

Answer 33

Strategic – long eterm 3-5 years undertaken by senior management

Tactical planning medium 1-2 years by mddle management

Operation planning – up to one year

Question 34

SWOT analysis

Answer 34

SWOT analysis is a tool which guides business planning and decision making yb leveraging strength and opportunity and mnimising weaknesses and threats

Internal strengths = strong product, skilled employees, strong financial position

Internal weaknesses = poor product, poor customer relations, inexperienced owner, staff

STRENGTH WEAKNESS OPPORTUNITY THREAT
Internal internal externall externall

Question 35

Business plan key features / benefits

Answer 35

Title, executive summary, business profile, vision mission statement, location business concept, feasibility and market research, legal details, insurance and risk management, sutainbility pan, marketing and fincnail plan

Question 36

Corporate Social responsibility

Answer 36

Corporate social responsibility is an expectation that operates around the world

It means businesses going out of their way to go above and beyond rather than just filling in legal requirements such as committing to minimisngn harm and damage to the community or environment