building the business

Question 1

5 key financial methods

Answer 1

remuneration
bonuses
commission
promotion 
fringe benefits

Question 2

remuneration

Answer 2

• money that is payed to an employee for working
• to retain employees the employer has to pay a satisfactory amount to the employee
• employees could be remunerated with a wage (usually paid by week) for the hours they work
• overtime work is payed for
• people are paid with a salary which is a fixed amount paid directly to their bank account monthly. additional hours are paid for

Question 3

bonuses and commissions

Answer 3

• additional amount of money paid to an employee if they perform a higher quality of work compared to others or if they reach a target
• commission is an amount of money distributed to an employee if they make a certain number of sales
• commission can often be a percentage e.g. 10% of the value of the service or product they sell
• using bonuses and commissions to motivate employees can result in higher level of productivity and sales
• the business needs to make sure that the employee knows what to do to obtain a bonus/commission
• because of the want of bonuses or commissions employees may push for a customer to invest in sales having a negative customer feedback

Question 4

promotion

Answer 4

• when a worker gets a new role with higher authority to their old one
• can be used as a form of motivation
• comes with an increase in salary and responsibility

Question 5

fringe benefits

Answer 5

-fringe benefits are other benefits offered by a business that financially benefit employees
-for example:
>a company car
>free healthcare insurance
>free childcare
-the business has to be careful with fringe benefits otherwise they will have to pay additional tax