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case study Flashcards

1
Q

what benefits does the European give us?

A
  • common movement
  • harmonising standards
  • social chapter
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2
Q

what is common movement?

A

free movement of people, goods and services

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3
Q

what is harmonising standards?

A

pass high quality standards, based in all European countries

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4
Q

what is social chapter?

A

common laws on employment law and consumer law

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5
Q

what impact on GG toys does free movement of people have?

A

sales people can move all round Europe selling goods

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6
Q

what impact on GG toys does free movement of labour have?

A

get staff from all over EU

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7
Q

what impact on GG toys does free movement of goods around EU have?

A

cheaper/ better quality goods from other places in the EU

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8
Q

what impact on GG toys does being able to pass quality standards in the UK have?

A

pass quality checks in all EU countries

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9
Q

what impact on GG toys does importing in raw materials from Europe have?

A

guaranteed high quality everywhere

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10
Q

what does SPICED stand for?

A

strong pound imports cheap exports dear

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11
Q

to what extend will a rise in interest rates badly effect GG toys?

A
  • wont effect GG toys
  • cheaper to import raw materials
  • value of pound dropped
  • costs fall
  • however raw materials only a small %
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12
Q

what are the benefits of buying from local suppliers?

A
  • local
  • quick delivery
  • good quality
  • English language
  • ethical
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13
Q

what are the benefits of buying from global suppliers/

A
  • cheaper
  • variety
  • good quality (ICT)
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14
Q

what are benefits of Toms toys setting up a website?

A
  • promotion
  • aware of business
  • more customers
  • take orders
  • deliver large amount of people
  • expand business
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15
Q

what are problems Toms Toys might get with setting up a website?

A
  • cant interact
  • cant physically see product
  • not want to order online
  • could crash
  • entire business is down
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16
Q

what is the definition of a competitive market?

A

several businesses exist in the one market. this is lots of competition

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17
Q

what are the native impacts on GG Toys if they move to China?

A
  • bad reputation
  • people wont supply/work for you
  • hard to get staff
  • staff aren’t willing to work for low wage
  • unmotivated staff
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18
Q

what technology can be used in production?

A

Robots

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19
Q

what is the benefits of using robots?

A

speed
quality
accurate

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20
Q

what are the problems with using robots?

A

expensive

not always reliable

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21
Q

what is retained profit?

A

profit left over from last year

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22
Q

what is the benefits of using retained profit to purchase a warehouse?

A
  • available all the time

- no interest to pay

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23
Q

what are disadvantages of using retained profit to purchase a warehouse?

A
  • shareholders wont be happy
  • no dividend
  • miss out on interest
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24
Q

what are the benefits of leasing when purchasing a warehouse?

A
  • flexible
  • easily leave
  • cheaper per month
  • better cash flow
25
Q

what are the disadvantages of leasing when purchasing a warehouse?

A
  • owner can cancel

- never own property

26
Q

what are the benefits of using a bank loan?

A
  • large amounts borrowed at low interest
  • therefore not getting in debt
  • regular repayments
  • cashflow not effected
  • business constantly has enough money
27
Q

why id quality important for GG toys?

A
  • keep high reputation
  • theyr’e seeing a big drop in profits
  • less wast= money
  • keep customers happy
28
Q

what is just in time?

A
  • order just amount of stock needed
  • less waste
  • cheaper storage
29
Q

how would a just in time benefit GG Toys?

A
  • theyr’e not making enough profit
  • so save money as storage costs are lower
  • less money spent on keeping products which could be damaged
  • less waste
  • cash flow better as less money spent on wasted products
30
Q

what is economies of scale?

A

the more you produce the less each one costs and cheaper fixed costs will be

31
Q

what are the 6 economies of scale?

A
  • financial
  • production
  • managerial
  • marketing
  • risk bearing
  • purchasing
32
Q

what are two economies of scale GG Toys benefit from in China?

A
  • production- financial costs are spread over a lot of products, therefore reducing costs
  • financial- low rates of interest, so more profits are sent back to UK
33
Q

what is job production?

A

when you make something to order

34
Q

what is batch production?

A

same machinery to make lots of different products

35
Q

what is mass/flow production?

A

making mass of the same product

36
Q

what are the benefits of job production?

A
  • charge high price

- high quality

37
Q

what are the problems with job production?

A
  • take a long time to get paid

- a lot of time

38
Q

what are the benefits of batch production?

A
  • only order in stock you need

- good cash flow

39
Q

what are the problems with batch production?

A
  • down time

- staff training

40
Q

what are the benefits of mass/flow production?

A
  • make more products

- less employees

41
Q

what are the problems with mass/flow production?

A
  • boredom

- storage costs

42
Q

which production is GG Toys most likely to use?

A

batch production

43
Q

why are firms moving their production from Uk to China?

A
  • cheaper labour
  • cheaper rent
  • still charge high price
  • close to Asian market
44
Q

why are some firms moving back to the UK?

A
  • grants
  • good reputation
  • more ethical
  • British brand name
  • language
45
Q

what is the equation for break even?

A

fixed costs/ sales price - variable cost = products

46
Q

what are two benefits of GG Toys using breakeven?

A
  • good way to judging business success

- set targets

47
Q

what are 2 limitations of GG Toys using break even?

A
  • only prediction

- assume fixed costs will always stay fixed

48
Q

what does cash flow forecasting show?

A

-money flowing in and out
-tells you if theres enough money for a day to day basis
enough money for wages

49
Q

would should you do to improve cashflow?

A

ask for overdraft

50
Q

what are 5 sources of finance?

A
  • trade credit
  • overdraft
  • credit card
  • advertise
  • rasie prices
51
Q

what are the limitations of cash flow forecasting?

A
  • assume sales are accurate
  • assume stock costs stay the same
  • only a forecast
52
Q

what are the negative impacts of video games of Toms Toys?

A
  • more interested in online games
  • people spend more money on video games
  • teenagers aren’t going to buy toys
53
Q

what are some strategies Toms Toys could use to promote?

A
  • get recommendations
  • better promotions
  • sell online
54
Q

what are the benefits of giving grants?

A
  • dont have to pay back
  • good for publicity
  • creates jobs
  • encourages businesses to expand
55
Q

what are the problems with giving grants?

A
  • long time tog et one
  • expensive
  • only use it for what government say you can
  • council tex + business rates increase
  • spend else where (schools)
56
Q

what are two reasons why Bowton Council are offering grants?

A
  • more jobs made
  • decrease unemployment
  • given to existing businesses looking to expand
  • so saving peoples jobs
57
Q

what is the negative impact on unemployment?

A
  • lots of people without job
  • leads to more unemployment
  • businesses shut down, less customers
58
Q

what are the positives of unemployment?

A
  • lower wages
  • motivate staff to keep jobs
  • sell else where for high prices

Business (3 decks)

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