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Prelim Business Studies > Business Planning > Flashcards

Business Planning Flashcards

1
Q

Identify four contributions SME’s make to the Australian economy.

A

75% of employment in the private sector.
50% of all products produced each year.
50% of Australia’s GDP.
Significant innovation.

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2
Q

Identify a situation where SME’s have an advantage over big businesses.

A

They have a higher success rate during a GFC.

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3
Q

Identify a disadvantage SME’s have over big businesses.

A

They pay more taxes.

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4
Q

Identify five factors that lead to the success of SME’s.

A 
Ability of the owner.
Research and information gathering.
Vision and flexibility.
Specialisation of market.
Location.
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5
Q

Identity five factors that lead to the failure of SME’s.

A 
Lack of experience.
Undercapitalisation.
Competition.
The economy.
Lack of financial training.
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6
Q

Identify five beneficial qualities for an SME owner to have.

A 
Ambition
Motivation
People Skills
Persistence
Self-Belief
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7
Q

Identify four factors affecting the viability of a location.

A

Visibility
Accessibility
Competition
Convenience

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8
Q

Identify two factors that can influence how an individual establishes an SME.

A

Qualifications

Personal culture

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9
Q

Identify an advantage and disadvantage that migrants often have when establishing a business.

A

They have a strong work ethic.

They lack a formal education.

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10
Q

Identify three reasons that women are opening SME’s at three times the rate of men.

A

Flexibility
Avoiding discrimination
Becoming financially independent

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11
Q

Identify five sources of information relevant to establishing a business and what type of information they provide.

A

Accountant - Finance
Solicitor - Legal
Chamber of Commerce - Assistance
ABS - Statistics
Census - Statistics

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12
Q

What does ABS stand for?

A

The Australian Bureau of Statistics.

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13
Q

Define an SME.

A

A business with 1-200 employees.

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14
Q

Describe market analysis.

A

Conducting primary and secondary research on the current market conditions. It assists in deciding how to set the price of products and services.

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15
Q

Describe Cost+Margin pricing.

A

Pricing based on COGS + the required profit margin.

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16
Q

Describe Market-Based pricing.

A

Pricing based on supply and demand.

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17
Q

Describe Competition-Based pricing.

A

Pricing based on charging more, less or equal to competitors.

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18
Q

Describe Penetration pricing.

A

Setting a low price to achieve market share.

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19
Q

Describe Loss Leader pricing.

A

Selling for a loss in order to clear stock or attract customers.

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20
Q

Describe Price Skimming.

A

Charging the highest reasonable price for a product to maximise profitability.

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21
Q

Describe Prestige pricing.

A

Charging a high price to create the illusion of luxury, exclusivity and quality.

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22
Q

Describe RRP.

A

Recommended Retail Price is the price a manufacturer recommends.

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23
Q

Identify what the term is for when a manufacturer demands that a retailer sells a product at RRP.

A

Resale Price Maintenance.

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24
Q

Identify the three types of retail locations.

A

Shopping Centre
Shopping Strip
Online Shopping

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25
Identify three advantages of shopping centres.
High volume of trade. Sought after location. Easy accessibility.
26
Identify three disadvantages of shopping centres.
High rent. High competition. Mandatory trading hours.
27
Identify four characteristics of a shopping strip.
Large variety. High competition. Viewed as a shopping destination. Questionable accessibility.
28
Identify six reasons why online shopping is growing.
``` Wide variety. 24hr access. Competitive pricing. Low overheads like wages. Low rent. Convenient. ```
29
Identify the two types of finance.
Debt finance and equity finance.
30
Identify three types of debt finance.
Overdraft Mortgage Lease
31
Identify the two types of equity finance.
Retained profits | Capital
32
What law established that all businesses must have their name registered, unless the business is the owner's name?
The NSW Business Names Act 1962
33
What is zoning, and what are the four most common types of zoning?
When the local government regulates land usage by only allowing it to be used for certain purposes. Residential, commercial, agricultural and industrial.
34
Which level of government can inspect for appropriate quality of food handling, hygiene, food storage and food temperature?
Local Government
35
Which government business can name and shame repeat offenders for not complying to hygiene regulations.
The NSW Food Authority
36
What act replaced the Trade Practises Act 1972 that protects consumers from misleading conduct?
The Competition and Consumer Act 2010
37
Identify a direct cost of employing staff.
Wages
38
Define on-costs.
Non-wage expenses from employee entitlements.
39
Identify four employee entitlements that incur on-costs.
Annual leave Sick pay Long-Service Leave Superannuation
40
Identify two on-costs that are not incurred by entitlements.
Worker's Compensation Insurance | Payroll Tax
41
Identify four federal taxes.
PAYG - Pay As You Go FBT - Fringe Benefits Tax GST - Goods and Services Tax GGT - Capital Gains Tax
42
Describe PAYG.
The Pay As You Go tax is a tax paid on a weekly basis on the wages made that week.
43
Describe FBT.
The Fringe Benefits Tax is a tax paid by employers on the benefits they give to employees.
44
Describe GST.
The Goods and Services Tax is a 10% tax paid by businesses on the sale of products and services.
45
Describe the Capital Gains Tax.
A tax made on profits made from the sale of assets.
46
Identify two state taxes.
Stamp Duty | Payroll Tax
47
Describe stamp duty.
A tax on the change of ownership of a property or car.
48
Describe payroll tax.
A tax paid by an employer when their payroll exceeds $638,000 p/a.
49
Describe local rates.
Locals rates are paid by individuals or businesses based on the value of land. Rates include the cost for sewerage, rubbish removal and water.
50
How is a situational analysis constructed?
``` By identifying: Strengths - Inner advantages Weaknesses - Inner disadvantages Opportunities - Outer advantages Threats - Outer disadvantages ```
51
Identify what wages are usually based off.
A percentage of sales.
52
Explain two strategies for organising operations.
Using CAD/CAM programs to reduce wastage and increase efficiency. Using cost centres to allocate resources and expenses.
53
Identify two strategies for organising marketing.
Utilising a marketing plan containing the marketing mix. | Have specific goals for what marketing should accomplish.
54
What do CAD and CAM stand for?
Computer Aided Design | Computer Aided Manufacturing
55
Identify five strategies to organise finance.
``` Organise sources of finance. Match terms of loans with the lifespan of an asset. Use budgets Manage revenue generation Utilise measurable KPIs. ```
56
What does KPI stand for?
Key Performance Indicators.
57
Identify six things that must be organised within human resources.
``` Rostering Training Recruitment Development Salaries WHS ```
58
Identify four techniques used in forecasting.
Using historicals (past figures) Identifying trends Observing competition Comparing to industry averages
59
Identify two areas that are often forecasted.
Total revenue and total costs.
60
How is total revenue calculated when multiple products with different prices are being sold?
Through the average spend.
61
Define monitoring.
Measuring actual performance compared to expected performance.
62
What is actual performance often compared to in monitoring?
KPIs.
63
Define evaluating.
Examining actual performance and determining success or failure based on KPIs and budgets, then establishing new KPIs and budgets.

Prelim Business Studies (5 decks)

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