internal environment Flashcards
business resources
natural resources - items used by the business that comes from the natural environment
eg. water, raw materials
labour - refers to the people that provide their skills, effort and knowledge to the business
eg. employees
capital - refers to the tools and machinery used to produce a good or perform a serviceto maximise effeciency.
eg. ovens, highways,
location
shopping centres -
high visibility, convenient, protected from weather.
rent is very high
retail shopping strips -
high visibility for passing traffic
limited weather protection, lack of parking
online -
no rent, convenient for customers
cost of planning, designing and maintaining website
homebased -
avoids rent, flexible
struggle seperating homelife and worklife
sources of finance
where the business gets their money from to perform their business related activities form either internal or external
internal (equity) finance -
self funding, family or friends, private investors, shares, crowdfunding
external sources -
loans, trade credit, government grants, leasing, bank overdraft
types of business models
online business - business that exists soley on the internent. it is broken up into categories
freemium - generates income through the offer of a premium subscription
merchant - independant website.
bricks and mortar - businesses with a physical location, most expensive to establish and maintain. many businesses have had to adapt and develop an online presence
social enterprise - model that aims to improve the wellbeing of others through its business activity usually obtains government funding
business support services
formal:
legal - solicitors: provides advice on legal matters,
financial - accountant: provides financial advice on managment issues,
technological: like an IT consultant,
and government:
informal: business mentors: seek advice on business matters
courses: BEC: business english certificate
planning tools - swot
SWOT analysis: strengths, weaknesses, opportunities, threats.
is a business planning tool that identifies strengths……
it evaluates the business’s current situation and interprets info on what the business might do well…..
it has the advantage of being low cost, and fairly simple to make and use. a SWOT analysis allows the business owner to become more familiar with the business which may help in making planning decisions.
benifits include it being a source for info for strategic planning
purchasing an existing business or establishing a new one
existing - the business is already operating, and everything associated with the business is included in the purchase (eg. staff, materials,).
benifits include, proven track record making it easier to gain finance, existing customer, seller may offer advice and training, equiptment is available for immediate use, employees can provide thier existing knowledge.
costs include, bad reputations, poor existing CSR, employees may resent the changes made, policies may be difficult to change
establishing - the most common reason for establishing is due to a gap in the market, where a demand is not being met.
benifits include, owner has freedom to start the way they want to, owner determines pace of growth, no existing policies or reputation.
costs include - it is high risk for failure, takes hard work and a lot of time, profits may not be generated right away
factors that influence location of a business
factors that influence location of a business include:
proximity - competitors, customers and materials
nature of business activity - busy areas - retail
internet - access to large market, fexible
cost of location
complementary businesses that sell similar products
visibilty
types of business models. p2.
franchise - franchise agreement = person buys the right to use a business name and distribute the goods/services of an existing business
imports and exports - earns income through trading internationally
imports - goods and services that are produced overseas and sold to australian consumers. exports - goods and services produced in australia and sold to overseas consumers
business legal structures
sole trader - an individual operates as the only person legally responsible for all aspects of the business. it is simple to set up, however personal assets may be sold to pay debt - u gain all profit rather than sharing, it eliminates the need to create a compay structure.
partnership - involves 2-20 people who carry the business together, with each partner personally liable for debts, usually a partner agreement is signed by all members. shares work load amoung people, with more ideas/input however conflict can be detrimental
private limited - in an incorporated entity that has its own legal identity. allows access to more finances but can be costly to set up
public listed company - incorporated entity that has many shareholders, listed on the stock exchange. no permission needed to trade shares but its difficult to chnage structure if need be.
planning - construction and features
a business plan is a written statement of the goals and objectives of the business, and the steps to be taken to acheive them. it is a summary and evaluation.
it should be a living document that chnages as the business does.
should include an
executive summary - which describes the business and its objectives
operations plan - how the business will be set up
financial plan - how the business will be financed and projected cash flow
marketing plan - key info about the industry and the gap in the market that will be filled
it creates an effective strategy for growth, and determines future financial needs
corporate social responsibility
a way in which the business operates that takes into account the broader social welfare of the community, customers, employees and suppliers
this may be done through improving their environmental impact, giving staff fair pay and good working conditions, legal requirements to be met in all aspects such as overseas where it may be manufactured.
