intro to business

Question 1

aims

Answer 1

general goals which provide long term vision/ direction

Question 2

objectives

Answer 2

specific targets which are steps towards acheiving aims

Question 3

owner

Answer 3

people who pay money into the business and now own it.

they want the bus to generate as much money as possible

Question 4

directors

Answer 4

responsible for company policies

make the business run smoothly

Question 5

SMART targets

Answer 5

specific, measurable, acheivable, realistic, time bound

Question 6

strategic aims/ objectives

Answer 6

long term goals that relate to the overal direction of the business
hard to change as go through many positions
eg) profit, growth (vague)
set by head of the business

Question 7

tactical objectives

Answer 7

medium/ short-term objectives that help the bus achieve its strategic ones. corprate and department level
can easily be changed
more specific then strategic

Question 8

operational objectives

Answer 8

short term objectives that relate to the day to day running of business

Question 9

business plans

Answer 9

written by entrepreneur before they start trading or before a new phase
what a business needs in order to succeed
should be updated with change

Question 10

advantages of business plans

Answer 10

• help support application for finance, pursuade bank for finance
• give the business a sense of direction

Question 11

disadvantages of business plans

Answer 11

• takes time to make, review and update
• can be long and complicated
• is useless unless its followed

Question 12

primary industry

Answer 12

sourcing of raw materials

eg) farming, coal mining, oil, gas

Question 13

secondary industry

Answer 13

turning raw materials into products to sell

eg) manufactoring, cars, food

Question 14

tertiary industry

Answer 14

selling the product ot service

eg) supermarkets, services

Question 15

adding value

Answer 15

at each stage of production a bus can add value to the product.
value added = price - cost of production

Question 16

sole traders

Answer 16

one owner, funded by owner
+ full control of decisions, keep all profit, easy to set up, chose own hours
- unlimited liabilty, hard to get start up funds, no continuity, may not have all thr skills

Question 17

partnership

Answer 17

20-20 owners, funded by owners
+ more skills/ ideas, more capital, less workload
- conflicting ideas/ decisions, split profit, unlimited liabilty

Question 18

LTD private limited company

Answer 18

incorperated, funded by investment, shares
+ limited liability, continuity, capital from shareholders, essier to access sources of finance
- business must chose shareholders, less privacy have to publish accounts

Question 19

PLC public limited company

Answer 19

floats on the stock market, funded by people why buy shares
+ limited liability, continuity, gains lots of shares
- risk of takeover

Question 20

research and development

Answer 20

market research, advertising and promotion

Question 21

distribution

Answer 21

products delivered correctly in the most cost effective way

Question 22

purchasing

Answer 22

buying all materials, ensure there is sufficient stock

Question 23

administration

Answer 23

support, organise travel and welcome visitors

Question 24

production

Answer 24

making goods, make enough, products to meet the demand, quality control

Question 25

customer service

Answer 25

customer questions, after sales support like refunds, exchange, damaged goods

Question 26

sales

Answer 26

sellimg products, knowledge of product range, advice for customers

Question 27

finance

Answer 27

records money coming in and out of the business, chasing up late payments, financial documents

Question 28

human resources

Answer 28

responsible for employees, advertise jobs, training and recruitment, employment law and records of staff sickness

Question 29

factors of production

Answer 29

land - natural resources available for production
labour - human input
enterprise - organise and take risks
capital - money used to buy things