Influences On A Business Flashcards
E-commerce definition
Buying and selling online
How can firms communicate with stakeholders
- Social media
- websites
- email
-mobile apps
-live chats
-video calls
Benefits of e commerce
Wider markets
More customers
Drawbacks of e commerce
Increased competition
What are ethics
Moral principles of right and wrong
Benefits of being ethical
Better reputation
Drawbacks of being ethical
Higher costs
Interest rates definition
The % reward for saving and % for borrowing
What happens when there are low interest rates
Increased spending, less reward on saving money. Firms will borrow more.
What happens when there are high interest rates
Borrowing money becomes more expensive. Saving increases as the reward for saving is higher. This reduces demand for products
What is globalisation
The process by which businesses and countries around the world become more interconnected.
Benefits of globalisation
Larger market to sell to
Labour is cheaper
Drawbacks of globalisation
Higher wages
Profits affected by exchange rates
Bad reputation for cheap labour in poorer countries
What is a strong pound good and bad for
Strong pound benefit-importer
Strong pound drawback-exporter
Who is a weak pound good for
Weak pound benefit-exporter
Weak pound drawback-importers
Spiced
Strong
Pound
Imports
Cheap
Exports
Dearer
Wpidec
Weak
Pound
Imports
Dearer
Exports
Cheaper
Why would a business relocate abroad
Labour is cheaper
What are external factors (e.g.)
Economy, legislation and technology are external factors affect a firm
During a recession what are workers worried about
Job secuirty
What is an MNC
Multi national cooperation
What does globalisation mean
There is an opportunity to sell to new markets but also increased competition.
What does consumer law state
Consumer law states a product should be fit for purpose, have satisfactory quality and match the trade description
What is a risk assessment
Used by firms to identify and manage possible danger
What is market share
% of sales/total of the market
What is the economic growth measurement
GDP(gross domestic product)
What is information and communications technology
The computing and communications systems that a business might use to exchange information with stakeholders
M commerce
The buying and selling through wireless, handheld devices such as smartphones
What is demand
The amount of a product that customers wish to purchase at the current price during a period of time
What is digital communication
The transmission of information electronically between computing devices
What are three example of digital communication
Email and texts
Web chat
Apps
What are the benefits of e-commerce
Accessing more markets-so small business can sell to the business so customers can order from anywhere which acts as a low cost way of targeting wider markets.
Business growth-much internal or organic business growth through e-commerce as e-commerce sales are growing rapidly than sales in shops.
Lower costs and potentially higher revenue-e-commerce reduces cost as it does not need a physical store, as airlines also sell tickets online direct to customers which reduces the commission they have to pay to travel agents.
What is organic growth
Growth from within the business
What is ethics
Refers to whether a business decision is thought to be morally right or wrong;an ethical decision is made on the basis of what is judged to be morally correct
What is social responsibility
An approach to managing a business in which the interests of all groups in society are considered when making decisions
What are ethical objectives
These are targets set up by the business to help it ensure that it’s decisions are morally correct;for example treating it’s staff fairly
What are the two decisions a business would pick between
Maximises profits-pay the lowest wages and cheapest materials so profit will increase
Morally right-choosing to Pay employees well or using more expensive resources that do not harm the environment
What is a zero hour contract
This type of contract allows an employer to hire staff without any guaranteed hours of work.
What is purchasing
The process of buying the goods and services needed for production to take place
Fair trade definition
Fair trade products are those for which customers pay higher prices and offer better trading terms, such as payments with orders; the aim is to improve the standard of living in poorer countries where the products are produced through ethical trade
Traffic congestion
This occurs when there are too many vehicles travelling for the road network, causing queues and delays
What is noise pollution
A very high level of sound that causes discomfort to humans and wildlife
What is scare resources
Those inputs into the production process that are insufficient to meet needs
Global warming definition
The gradual heating of earth’s surface, oceans and atmosphere
What is sustainability
Refers to methods of production which can be continued in the long term without damage the environment
What is recycling
The Reuse of raw materials used in making products, often many times e.g. include the reuse of glass, paper and metals