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Business Preliminary > Concepts > Flashcards

Concepts Flashcards

1
Q

Role of business

A

to produce and sell goods and services in order to satisfy the needs and wants of individuals with the aim of making a profit. They provide employment, pay taxes and improv quality of life.

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2
Q

Profit

A

what remains after revenue minus cost

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3
Q

employment- types (4)

A

full time
casual
part time
self employed

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4
Q

income (3)

A

employee- wages/salaries
business owners- profits
shareholders- dividends

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5
Q

wealth

A

increasing sales increases value of business

business generate increased wealth for community through cooperate tax

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6
Q

quality of life is improved through (4)

A

improving product quality
providing employment
environmentally friendly products
satisfying needs and wants

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7
Q

factors determining type of business (6)

A

number of employees (5, 20, 200)
ownership (independent, partner, shareholders)
legal structure (sole trader, partnership, private, public, gov)
market share (small, medium, large)
industry (primary, secondary, tertiary, quaternary, quinary)
geography (local, national, global)

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8
Q

influences on the business environment (10, 5)

A

external- economic, financial, geographic, social, legal, political, institutional, technological, competitive situation, markets

internal- products, location, resources, business culture, management

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9
Q

economic external influence

A

determined by consumer buying and spending
economic cycle shows fluctuation of consumer spending
ex.
boom- more spending
downturn- low profit low amount of g&s produced

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10
Q

financial external influence (2)

A

2 sources- debt finance, equity finance

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11
Q

geographical external influence (3)

A

location
population shifts
average age

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12
Q

social external influence (3)

A

making donations
environmentally friendly
sponsoring events

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13
Q

legal external influence (3)

A

equal pay
fair conduct
emergency evacuation

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14
Q

political external influence

A

new party policies may influence business actions
ex.
green party advocate environmental policies

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15
Q

institutional external influence (4)

A

environment protection authority
Australian taxation office
Australian securities and investment commission
NSW fair trading

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16
Q

technological external influence (3)

A

increase efficiency
create opportunities for innovating/ inveneting proudcts
may be expensive –> redundancy

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17
Q

product internal influence (4)

A

distance from supplier
distance from customer, size of customer base
training and development
maintaining quality

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18
Q

location (4)

A

visibility
cost
proximity
support services

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19
Q

stakeholders internal (4) and external (5)

A

internal- managers, employees, owner, investor

external- shareholders, govern, customers, society, environment

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20
Q

business life cycle stages (4)

A

establishment
growth
maturity
post maturity

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21
Q

establishment challenges (5)

A 
generating sufficient revenue
choosing suitable location
developing appropriate market strategies
following gov regulations
positive cashflow
22
Q

Growth challenges (2)

A

Production costs

Remanagment of

23
Q

Maturity challenges (3)

A

Developing strategies
Motivating employees
Ensuring financial position

24
Q

Postmaturity challenges (4)

A

Steady state
Decline
Renewal
Cessation

25
Q

Features of effective management (5)

A

Planning
Organizing
Leading
Controlling

26
Q

Skills and management (7)

A 
Interpersonal /communications
Strategic thinking
Vision
Problem-solving
decision making
Flexibility and adaptability to change
Reconciling conflicting interests of stakeholders
27
Q

Smart goals

A 
Specific
Measurable
Achievable
Realistic
Time bound
28
Q

Types of goals (6)

A 
Profits
Market share
Growth
Share price
Social
Environmental
29
Q

Management approaches

A

Classical- organizing, controlling
Hierarchical organizational structure
Autocratic leadership

Behavioural- leading, motivating, communicating
Teams (decentralize power and authority)
Democratic leadership styles

Contingency approach- flexible, adaptable
Adapting to changing circumstances

30
Q

Management processes (4)

A

Operations
Human resources
Marking
Finance

31
Q

Operation (3)

A 
Good (tangible) and services (intangible)
Production process (inputs, outputs)
Quality management
32
Q

Human resources

A

Acquisition / recruitment
Develop/ training
Maintain/ non monetary and monetary benefits
Separation/ voluntary or involuntary

33
Q

Marketing

A 
Target market
Marketing mix (price, product, place, promotion)
34
Q

Target marketing

A

Mass

Niche

35
Q

Finance (2, 3)

A

Management accounting
Financial accounting

Cash flow
Income
Balance

36
Q

% of SME in business

A

98%

37
Q

Influences in establishing an SME (3)

A

Personal qualities
Sources of information
Business idea

38
Q

Personal qualities

A 
Qualification
Skill
Motivation
Entrepreneurship
Cultural background
Gender
39
Q

Establishment options

A

New
Existing
Franchise

40
Q

Market influences

A

Goods and services
Price
Location

41
Q

Finance influences

A

Source

Cost

42
Q

Legal influences (4)

A

Business name
Zoning
Health
Other regulations (warantees, safe products, misleading conduct)

43
Q

Importance of business plan (4)

A

Assess strengths/ weakened
Prepare for possible challenges
Prepare for future changes
Allocate financial resources properly

44
Q

Management

A

Achieve most effective outcome - productivity

Achieve strategic goals of a business

45
Q

Trend analysis

A

Changes over time

46
Q

Technology

A

Better products

Lower costs

47
Q

Economic conditions

A

Recession and booms can influence consumer buying and spending

48
Q

Business success

A

Make a detailed plan
Buy a franchise
partnership for support
Market research to identify opportunities
Manage cash flow
Buy an established business after investigating

49
Q

Resources

A

Financial
Input
Staff

50
Q

Competitions

A

Amount of competition will determine if a business can be established or not
Depends of number of competitors in maketc

Business Preliminary (3 decks)

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