business foundation Flashcards
What are the internal vs. external factors that influence businesses?
Internal factors include aspects within the business, while external factors are elements outside the business that can affect operations.
Examples of external factors include market trends, regulations, and economic conditions.
List the key business functions that need to cooperate to run a functioning business.
- Administration
- Human resources
- Research & development
- Production
- Marketing
- Finance
What are the factors of production?
- Land
- Labour
- Capital
- Enterprise
How do competitors influence a business?
- Pricing strategies
- Product innovation
- Marketing and branding
- Customer expectations
- Market share and sales
What are some reasons for deciding to open your own business?
- Loss of job
- Desire for independence
- Wish for higher income
- Identification of market opportunities
What are potential sources for new business ideas?
- Skills and hobbies
- Previous employment experience
- Small budget market research
What is a business plan?
A plan for the development of a new business, providing details about the products or services to be sold as well as financial forecasts.
What are the parts of a business plan?
- Introduction
- Executive summary
- Opportunity
- The team
- Business environment (SWOT analysis)
- Marketing plan
- Operations execution
- Finance
- Risks and conclusions
- Appendix
What is a franchise?
A business that sells rights to other businesses allowing them to sell their products/use the company name through a contractual agreement.
Define sole trader/proprietorship.
One person provides all the finances, has full control, keeps all the profits, but also has unlimited liability and carries all the risk.
What is a partnership in business?
Two or more people carry the business together, with shared capital investment, shared responsibilities, and shared profits.
What is a private limited company?
A business owned by shareholders that cannot sell shares to the general public, with end-of-year accounts available for everyone to see.
What is a public limited company?
A company with the legal right to sell shares to the general public, offering shareholders limited liability but facing many legal formalities.
What are public corporations?
Entities owned and controlled by the state, primarily financed by the government, with a high degree of government interference.
What are the three types of economies?
- Free market
- Command
- Mixed economy
What is the difference between aims and objectives in business?
Aims are the purpose of the business, while objectives are smaller goals to achieve those aims.
What does SMART stand for in business objectives?
Specific, Measurable, Achievable, Relevant, Time-bound.
What are the benefits of SMART objectives?
- Clear objectives
- Easily measurable
- Evaluatable
What are some limitations of SMART objectives?
- Business environment might change
- Non-specific factors may arise
- Uncertainty in what is achievable in a specific time
What is a mission statement?
Core aims of a business, phrased to motivate employees and stimulate interest from outside groups.
What is a vision statement?
What the organization would like to achieve in the long term, describing what the company wants to be.
