Business Flashcards
1
Q
What is the difference between a need and a want
A
A need is essential to live and a wants are things that we would like to have but are non-essential
2
Q
Give two examples of a need
A
water and food
3
Q
Give two examples of a want
A
Jewellery and holidays
4
Q
What is the difference between a good and a service
A
Goods are things that we can see, touch and pick up which means they are tangible. Services are things we can’t see, pick up and touch, which makes them intangible.
5
Q
Give 3 examples of goods
A
bread, rings and mobile phones
6
Q
Give 3 examples of services
A
A haircut, a dentist appointment and getting a mechanic to fix your car.
7
Q
What is the definition of durable and non-durable
A
Durable means it can be used more than once (like a washing machine). Non-durable means it can only be used once (like a plaster).
8
Q
What does the term ‘production’ mean
A
The process of making or manufacturing goods and products from raw materials or component
9
Q
What does the term ‘consumption’ mean
A
The act of using resources to satisfy current needs and wants.
10
Q
Give 2 reasons why businesses would want to satisfy people’s needs and wants
A
To create customer loyalty and to get good ratings and status
11
Q
What does the term ‘factors of production’ mean
A
The different resources that are combined to produce something
12
Q
Name the four factors of production
A
Capital, Enterprise, Land, Labour
13
Q
Describe Labour
A
The people employed by a business (the workforce) to make the product
14
Q
Describe land
A
The natural resources of the world, e.g water, air and plants.
15
Q
Describe capital
A
The man-made resources that are needed to make a product, e.g machines, tools and money.
16
Q
Describe enterprise
A
Combining all the factors of production by the entrepreneur
17
Q
Who combines the factors of production
A
They combined by the entrepreneur
18
Q
Name five skills an entrepreneur might have
A
confidence, problem-solving skills, motivation, people skills and determination.
19
Q
What does the term ‘creating wealth’ mean
A
Wealth creation is when each sector passes on a product, adding value.
20
Q
Name and describe the first sector of industry
A
Primary, businesses in this sector take raw materials from the ground e.g agriculture and farming, fishing,mining.
21
Q
Name and describe the second sector of industry
A
Secondary, Businesses in this sector use raw materials and make something with them, e.g a car manufacturer, a builder, a cake baker.
22
Q
Name and describe the third sector of industry
A
Tertiary, business in this sector provide a service, e.g a fitness instructor, a hotel, a supermarket
23
Q
Name the three sectors of economy
A
Private, public and third
24
Q
What are the 3 sectors of business in the private sector
A
Sole trader, partnerships and private limited companies (Ltd)
25
Name 2 sectors of business in the public sector
National government, Local government organisation
26
Name 2 sectors of business in the third sector
social enterprises and non-profit making organisations e.g. charities
27
What is the private sector
They are organisations that are owned by individuals and aim to make a profit
28
what is the public sector
Thy are organisations that are owned by the government on behalf of the taxpayer and aim to provide a services to the general public.
29
What is the third sector
Non-profit making organisation such as charities and voluntary organisations that are set up to support specific cause.
30
What is a stakeholder
A stake holder is a person or a group of people who have an interest in the success of a business
31
Give three examples of a stake holder
Owners, shareholders, employees
32
What is marketing
Marketing is getting your potential customer to be aware of your products or services with the desired outcome of increasing your sales
33
Why is marketing important
It can attract new customers by letting know about the range of products the business has
It can help a business grow by entering new markets and can increase the profit a business makes
34
What is a market
A market is where customers and sellers come together to trade money for goods or services
35
What is a gap in the market
it is an are in the market that businesses don't serve but there is a customer demand for
36
What is provided in a market
goods and services
37
Name 3 places a market can exist
In a shop, over the telephone and on a website
38
what is the marketing mix
It consists of using the 4 Ps to successfully reach and influence
39
What are the '4 Ps'
Price, product, promotion and place
40
describe product
This is the actual item (a good or service) that is produced by the business and then sold in a market
41
describe price
This is how much money a business charges the customer to buy the product.
42
describe place
This the way the business makes the product available to the customer and where the products are sold
43
describe promotion
This is how customers are told that the product exists and are encouraged in different ways to buy it.
44
why is product important
The product must be what the customer wants or they will not buy it.
45
why is place important
The product must be accessible to the customer
46
why is price important
The product must be a price that the customer will buy it at. The price must not be too high compared to the competition.
47
why is promotion important
The product must be promoted and advertised to customers so that they know it exists.
48
What is a business
Organisations that trade goods or services with other organisations for money.
49
define Disposable income
The money left over from bills, taxes, rent etc
50
What is an entrepreneur
Is a business owner / someone with an idea and made it a business
51
What is internal recruitment
The business will only advertise the job to existing employees
52
What is external recruitment
The business will advertise the job to the public
53
Identify the stages of the recruitment process
Identify a job vacancy - Carry out a job analysis - Prepare a job description - Prepare a person specification - Advertise the job send out applications.
54
Name three activities carried out by the HRM department
Motivating and training staff, Providing safe working condition and Ensuring employees get paid correctly
55
What happens at each stage of the recruitment process. Part 1 (up to the job description)
Check that a job vacancy actually exists, The vacancy is looked at in detail and the tasks, duties and responsibility and the info is used to create a person specification and job description, A job description contains info about what the job involves.
56
What happens at each stage of the recruitment process. Part 2 (Start at person specification)
A person specification provides info about the type of person that is required, Before people can apply for a job, they have to know it exists, this is why advertising it is important, Finally send out applications , businesses can ask people to apply by completing an application or by sending in a CV
57
Give 3 examples of internal advertisement
Emails, Notice boards and meetings
58
Give 3 examples of external advertisement
TV, Online sites and newspaper
59
What does PESTEC stand for
Political, Economy, Socio-culture, Technology, Environmental and Competitors.
60
Explain political (PESTEC)
Laws + Government, The government can set laws which can make a business pay more money. or less money e.g minimum wage act
61
Explain Environmental (PESTEC)
Weather, if the weather is bad the crops won't grow as well or not at all, If you don't follow good practice for environmental matters e.g eco-friendly or pet friendly. then that will risk business getting customers
62
Explain Socio-culture (PESTEC)
Trend, if a business's product becomes less popular then that will cost them a lot of money
63
Explain Technology (PESTEC)
Machinery + tech , If you don't have well working machinery or ones that are not up to date then it will create customer complaints and if you fall behind on developments e.g being online then you risk losing customers to competitors.
64
Explain Economy (PESTEC)
Intrest + Exchange rates, Bank exchange - if exchange gets worse e.g fewer euros per pound then raw materials become more expensive abroad
65
Explain Competitors (PESTEC)
Competition, If the competitions is working the marketing mix better than you then that could have an effect on your business, so you have to be the same or better than them.
66
Give examples of external stakeholders
Government, customers and banks
67
Give examples of internal stakeholders
Owners, Managers, and Employees
68
What is customer service
This is the support you offer your customer - both before and after they buy and use your product or service
69
What are risks of poor customer service
Loss of business reputation and negative word-of-mouth marketing, loss of revenue and profits
70
What are the benefits of providing good customer service
It always helps retain your customers, boosts sales, encourage customer loyalty and build a good reputation
71
Why motivate staff
So they can do their job well
More focused and less distracted
More effort into their job
72
How to motivate staff
Financial - offer a pay rise, bonuses
Non-financial - Recognise birthdays, anniversaries and free food
73
Give examples of working patterns
Full time job - guaranteed hours
Part time - less than 35 hours
Flexi time - must work core hours e.g working 10-2
74
Name the types of training and give a short definition
Induction training - this is offered to new employees which includes a tour of the premises and information about the company
On-the-job training - This is undertaken in your place of work, it can be carried out by job rotation, coaching, shadowing, demonstration etc
Off-the-job training - this is undertaken outside the place of work, this can be in places like colleges or training centres
75
Define selection and give 4 different methods
Selection is the process of identifying the best candidate for a vacancy. Methods include - Interviews, A CV, References and Application forms
76
Give an advantage and disadvantage of internal advertisement
They already know how the company works
Another vacancy is created
77
Give an advantage and disadvantage of external advertisement
New skills and ideas
Don't know if they will work well with staff
78
What are the 5 functions of HRM
Recruitment, selection, training, motivation and discipline
79
What does HRM stand for
Human Resource Management
80
What is the shortened business cycle
Businesses produce goods and services to meet customers wants - Customers buy goods and services to satisfy their wants - Wealth is created for businesses and for their employees and owners - Customers have money to spend from their wages and want other goods and services
81
What is the first half of the business cycle
People have needs and wants
Businesses are created to meet these needs and wants
The businesses employ people to produce goods and services
Customers buy the goods and services to meet their needs and wants
82
What is the second half of the business cycle
Wealth is created for businesses and the owners
Employees are paid a wage
Customers have money to spend from their wages and want existing and new goods and services - Existing businesses grow to meet the increase demand and new businesses are created to employ more people
83
Inflation definition
Prices rise because demand is high and supply is low
84
Recession definition
When demand is low leading to job losses and businesses closing
85
The business cycle going clockwise =
Increase demand, growth and inflation
86
The business cycle going anti-clockwise =
Falling demand, closing businesses and recession
87
Sources of help and advice
Marketing/promotion and Finance documents - Citizens advice
Law - a law center
Setting up a business - The prince's trust
Getting loans - credit union
Getting grants - GOV.uk
88
what are variable costs
Any cost directly linked to producing the goods or services e.g raw materials
89
what are fixed costs
costs that have to be paid regardless of the sales e.g rent, heating and insurance
90
Net profit definition
Money available to spend after any costs and expenses
91
What do income statements show
It shows profit and loss of an organisation over a period of time e.g 3,6 or 12 months.
92
What do income statements allow
It allows a business to make decisions about prices, costs and expenses to make the highest profit
93
What is a break even point
It is the point at which total cost and total revenue are equal.
The number of items to sell to stop making a loss and just before making a profit
94
What are the 3 parts of income statement
1.Trading account
2. Profit and loss account
3. Appropriation account
95
What does a trading account do
This focuses on sales and the directly related costs and shows gross profit
96
What does a Profit and loss account do
Considers the fixed or indirect costs e.g rent, wages and council tax
97
What does a Appropriation account do
This is how the net profit is used and appropriated (handed out)
98
What is Cash flow statement or forecast used for
Used to identify Excess money which can support new projects
Used to spot cash flow problems and solve them
99
What does Cash flow statement or forecast show
Shows money earned or received by the business
Shows money paid out or spent by the business
100
What do Cash flow statement or forecast look for
Trends - falling or increasing sales, cost, balance
Single large purchases
Sudden increase in a cost
101
What is gross profit
Money earned before expenses (fixed cost)
The profit from buying and selling
102
An advantage and disadvantage of induction training
Employees will settle quickly into the job
Takes time so reduces output
103
An advantage and disadvantage of on-the-job training
Training is specific to the company's needs
Qualities of training might not be as good
104
An advantage and disadvantage of off-the-job training
Higher quality training because its usually delivered by experts
Productivity decrease due to time being spent away from the place of work
105
What are stakeholders
They are groups or individuals who have an interest in and influence on a business.
106
Give 2 examples of fixed costs
Rent and insurance
107
Give 2 examples of variable costs
Raw materials and electricity
108
How is profit calculated
Profit = Sales - Expenses
109
3 causes of poor cash flow
Spending too much money on stock that has not sold
Not receiving enough money from sales
Owners taking too much money out of the business
110
How is gross profit calculated
Purchases - sales
111
3 expenses a business might have
Electricity, wages and insurance
