Business test retake Flashcards
What is a competitor?
A competitor is an individual organisation who sells the same type of product or service as your to the same potential customers possibly at a similar price.
What is a business plan?
A business plan is a document that stores all the information you need to start your business.
What does a business plan include
General detail, details of the product or service being delivered/produced, the roles and responsibilities of employees, equipment required, CELL, finance (what are the costs and where is the money coming from) marketing information (your target audience).
Why do we have a business plan?
To know and understand what we are doing, provide information to help obtain funding, inform employees and guide their work, monitor the success of your plan/ stay on track.
Finance that a bank offers?
Bank overdraft, Short term loan, long term loan, mortgage. (All have interest to be paid back.
Bank overdraft meaning?
It is an emergency loan that is short term with a high interest. You take out more than available in your account.
Short term loan meaning?
A loan to be payed back monthly, short term (less than a year), high interest, used to normally buy equipment.
Long term loan meaning?
A loan to be payed back monthly, long term (more than a year eg. 10 years), low interest, buy equipment and machinery.
Mortgage meaning
A mortgage is an agreement between you and a lender that gives the lender he right to take your property if you fail to repay the money you have borrowed plus interest. Long term (25 years), low interest.
What is marketing information
Marketing information is your target audience for your business.
What is leasing?
A legal binding contract outlining the term under which one party agrees to rent properties owned by another party.
What is hire purchase?
Hire purchase is a loan option that allows you to pay for a new or used car in monthly instalments.
What is the difference between hire purchase and leasing?
At the end of a lease you return the asset and at the end of hire purchase you have the option to purchase and keep the asset if you choose.
What is dept factoring?
Dept factoring is when customers who buy on credit fail to pay on time or attempt not to pay at all the business can use a factoring service.
What is trade credit?
An arrangement to buy goods or services on account without making immediate cash or check payment
