Exam Review - Business Flashcards
Leadership
The manner by which individuals determine objectives, provide guidance, motivate others, measure performance and establish an environment that brings excellence, they facilitate the achievement of common goals
Democratic
Value input from team-members
Autocratic
Leaders that make all the decisions
Lassiez-Faire
Non-Intrusive/hands off leadership
Transactional
Uses rewards and punishments to motivate people
Transformational
All about vision and unite over a shared sense of purpose
Supply
The quantity of a good or service that producers are willing and able to sell at various prices during a given period of time
Demand
The quantity of a good or service that consumers are willing and able to purchase at various prices during a given period of time
Market Equilibrium
The point where the supply and demand curves intersect, indicating the equilibrium price and quantity
Surplus
an amount of something left over when requirements have been met; an excess of production or supply over demand
Competition
refers to a contest or rivalry between two or more competitors. In business and marketing, competition is a situation in which one company is trying to be more successful than another
Market Force
The economic factors that influence the behaviour of consumers and producers in a market
Needs
Things that people require to survive, a human body would not function without these things
Wants
Things that a person would like to have but are not needed for survival
Non-Profit
Operate strictly to help people in the community
Sole Proprietorship
Owned by one person
For-Profit
A business that produces or sells goods/services to satisfy the needs, wants and demands of consumers for the purpose of making profit
Partnership
Owned by two or more people
Co-Operative
Owned by it’s workers or members who buy from the business
Corporation
An “Artificial Person” established for the purpose of doing business
Franchise
When a business licenses another to use it’s name, operating procedure, etc. under the above form of ownership
Promotional Strategies
Promotion involves communication strategies used to inform potential customers about products
Traditional: TV Commercials, Radio, Print
Digital: Social media, email, influencer marketing
Sales: Discounts coupons and limited time offers
Public Relations (PR): Managing the company’s public image
4 Ps Of Marketing
Product, Place, Price and Promotion
Product Development Process
All steps needed to take a product from concept to market availability
Production Process
The entire sequence of steps involved in producing a product or service from beginning to end
The goal is to ensure final product is high quality, delivered in a reasonable amount of time that suits the customer and it makes money for the company
Lean Manufacturing
Focuses on minimizing waste and maximizing productivity
Supply Chain Management
the process of planning, implementing, and controlling the flow of materials and finished goods from supplier to consumer
3Cs of Marketing
Company, Customer, Competitor
Accounting
Involves methodically recording the countless financial transactions that occur in a business every day, allocating them to the correct amount, and then interpreting the overall results
Balance Sheet
Shows the financial position of the business on a specific date, how well the company is using its resources (assets) and how competently it is managing the financial affairs of the business (liabilities and owner’s equity)
Called a balance sheet because Assets must equal or balance Liabilities and Owner’s Equity
Ethical Responsibilities
ensuring a business engages in fair business practices across the board. Companies should treat all employees, stakeholders, and customers ethically with fairness and respect
Celebrity Marketing
Uses prominent individuals who have substantial influence over a group of people in the hope of sending message to a group
Income Statement
Shows a company’s revenue and expenses and net profit (or net loss) over a certain period of time
Database Marketing
Uses massive databases and sophisticated analytics to target specific consumers, some of whom may not have been asked to be solicited
Ethical Dilemma
a type of ethical issue that arises when the available choices and obligations in a specific situation do not allow for an ethical outcome
Viral Marketing
Based on encouraging people to pass along favourable marketing messages to friends, colleagues and contacts. Viral marketing is the principle that underlies much of social media and internet advertising
Green Marketing
Or environmental marketing, involves promoting products, highlighting features of products, that respond to the growing ecological concerns in our society today, particular among younger consumers
Jingle Marketing
Involves coming up with a catchy word or jingle that instantly strikes a chord with the right people at the right time
Guerrilla Marketing
Describes unconventional marketing techniques that are intended to make a splash
Social Media Marketing
Way of promoting products by creating and sharing content on the internet
Decision-Making Using Balance Sheets
We can use the Balance sheet to gain an in-depth understanding of how well a company is performing using the following ratios
Profitability Ratios: How much money a company makes
Liquidity Ratios: How quickly a firm can pay the money it owes in the short term like it’s accounts payable
Solvency Ratios: Assess whether a company can pay its long-term debts
Quick Ratios: measures liquidity, It measures whether the business can use its current assets to pay its current liabilities
If a business has a quick ratio greater than 1.0 it has the resources to pay all its current liabilities
Quick Ratio = Current Assets ÷ current liabilities
Decision Making Using Income Statement
Using the income statement you can calculate the Net Profit Margin which measures the relationship of Net Income to Total Revenue
The Net Profit Margin shows you that for every dollar of sales the business brings in, what the owner’s final share would be
Net Profit Margin = Net Income ÷ Total Revenue
13 Characteristics of Entrepreneurs
Able to Get Along with Others
Creative
Flexible
Goal-Oriented
Hardworking
Independent
Intuitive/Perceptive
Motivated
Optimistic
Resourceful
Risk Management
Self-Confidence
Visionary
Marketing (Product)
What are you selling? What are the features/benefits? Looking at specifications, materials and safety
- A successful product must satisfy the wants and needs of customers and do so better than their competitors
- It has to be useful
- Design must consider materials, size/varieties, warranties, packaging, return policies, safety, durability, ingredients and environmental friendliness
Premium: High quality
Competitive: Moderate quality
Value: Low quality
- Packing must also protect and promote the goods inside and also make the product more convenient to use
Marketing (Place)
Where will you sell it?
Direct Distribution Channels: When a business sells a good, service or event directly to the customer
Indirect Distribution: Involve second-party sellers that are supplied by outside firms, but in some cases, businesses offer their own products call “private” or “house” brands
Retail: The product is sold but not by the manufacturer (Best Buy Electronics)
Wholesale: The product is sold in larger amounts but not by the manufacturer (Costco)
Specialty: Product is sold in a specialized way without contact with a company (Vending Machine)
Marketing (Price)
What is the value of the product? How much will customers pay? What pricing strategies are used?
The product will generally fall into premium, competitive or value and this will influence pricing
Pricing Stragtegies
Penetration Pricing: Enters market at a low price that will be raised later should the product become popular
Competitive Pricing: The average “benchmark” price for the product or service, companies will have to stand out in other ways
Price Skimming: Starts high to be lowered later once competing brands make the same product
Psychological Pricing: Ending in 99 cents to give the illusion you are receiving a deal
Marketing (Promotion)
How will you let people know about your product? How is it being advertised?
Marketing (Customer)
Who are your target customers? What do they want? Includes understanding target demographics, needs, and purchasing behaviours
Markting (Company)
Understand your strengths and weaknesses. Includes internal factors such as mission statement, strengths, and brand identity
Marketing (Competitor)
Who are your competitors, and how are they succeeding? Includes competitor analysis, market position and differentiation strategies
Direct Competition: Businesses compete to sell what is essentially the same product
Indirect Competition: Businesses offer different products to the same target market
Perks and Drawbacks of Autocratic Leaders
- Tasks are completed
- People work better under pressure
- Less Stress
- Organization
- Lack of Communication
- Feared
- Misunderstandings
Perks and Drawbacks of Democratic Leaders
- Positive work environment
- Everyone is heard
- Less mistakes/bad decisions
- Positive team relationships
- Long process
- Distraction
Perks and Drawbacks of Laissez-Faire Leaders
- High levels of employee satisfaction
- Flexible
- Lack of accountability
- Stress
- Missed due dates
- Disorganization
Perks and Drawbacks of Transactional Leaders
- Produces consistent and reliable results
- Reduced confusion about expectations
- It leaves little room for creativity
- Eliminates individuality and creates more followers than leaders
