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N5 Business Management > Key Points > Flashcards

Key Points Flashcards

1
Q

Land

A

The natural resources of the world

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2
Q

Labour

A

The people employed by a business (the workforce) to make the product

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3
Q

Capital

A

The man-made resources that are needed to make a product

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4
Q

Enterprise

A

Combining all factors of production, done by the entrepreneur

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5
Q

Business cycle: stage 1

A

People (consumers) have needs and wants

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6
Q

Business cycle: stage 2

A

Businesses identify these wants by doing research

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7
Q

Business cycle: stage 3

A

Businesses produce goods and services to satisfy consumer needs and wants and make a profit

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8
Q

Business cycle: stage 4

A

Consumers buy the goods and services produced by the business and consume them

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9
Q

Factors of production (CELL) - list

A

Land, labour, capital, and enterprise

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10
Q

Sectors of industry - list

A

Primary, secondary and tertiary

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11
Q

Primary sector

A

They take raw materials from the ground

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12
Q

Secondary sector

A

They use raw materials and make something with them

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13
Q

Tertiary sector

A

They provide a service

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14
Q

Sectors of the economy - list

A

Private, public and third

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15
Q

Private sector businesses - list

A

Sole traders, partnerships and private limited companies

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16
Q

Public sector businesses - list

A

National government and local government organisations

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17
Q

Third sector businesses - list

A

Non-profit making organisations and social enterprises

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18
Q

External factors (PESTEC) - list

A

Political, economic, social, technological, environmental and competitive

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19
Q

Internal factors - list

A

Financial, human resources and current technology

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20
Q

Stakeholders - list

A

Owners, shareholders, employees, banks, customers, suppliers, local community, pressure groups, local government and national government

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21
Q

Market segments - list

A

Gender, age, occupation, religious or cultural beliefs, income / social class, geographical location and lifestyle

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22
Q

Marketing mix - list

A

Product, price, place and promotion

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23
Q

Product

A

The actual item produced by the business and then sold in a market

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24
Q

Price

A

How much money a business charges the customer to buy the product

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25
Q

Place

A

The way the business makes the product available to the customer and where the product is sold

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26
Q

Promotion

A

How customers are told the product exists and are encouraged in different ways to buy it

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27
Q

Product life cycle - list

A

Introduction, growth, maturity and decline

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28
Q

Introduction

A

The product is released onto the market, and lots of advertising and promotion is done to encourage sales

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29
Q

Growth

A

When sales of the product are growing because more customers know it exists as a result of lots of promotion

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30
Q

Maturity

A

When sales of the product reach their highest, and as a result this is the most profitable stage

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31
Q

Decline

A

When sales of the product begin to fall because the product is getting older and newer versions are coming onto the market; customers no longer want it

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32
Q

Pricing strategies - list

A

Low price, high price, promotional pricing, cost-plus pricing and psychological pricing

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33
Q

Low price

A

The price charged is lower than that of competitors

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34
Q

High price

A

The price charged is higher than that of competitors

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35
Q

Promotional pricing

A

The price charged is lower than normal for a short period

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36
Q

Cost-plus pricing

A

The cost of making the product is calculated and then a percentage is added on for profit

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37
Q

Psychological pricing

A

The price charged by the business makes the customer think the product is cheaper than it is

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38
Q

Distribution methods - list

A

Road, train, aircraft, and boat

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39
Q

Advertising methods - list

A

TV, newspapers and magazines, radio and the media, billboards, internet websites, apps, text messaging, email advertising

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40
Q

Types of market research

A

Field research and desk research

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41
Q

Field research

A

Gathering new information by carrying out surveys, interviews and observations; it gathers primary information

42
Q

Desk research

A

Looking at existing information, e.g. in newspapers, books and internet websites; it gathers secondary information

43
Q

Methods of field research

A

Personal interview, focus group, postal survey, telephone survey, online survey, hall test, observation, electronic point of sale (EPOS) and social networking website

44
Q

Objectives (list)

A

Survival, profit, provision of a service, customer satisfaction, enterprise, social responsibility and market share

45
Q

Purchasing mix

A

Cost of raw materials, quality of raw materials, lead time / delivery time, quantity of raw materials, location of supplier, reliability and reputation of supplier, and storage space available

46
Q

Methods of production - list

A

Job, batch and flow

47
Q

Job production

A

When one product is made from start to finish before another one is made, and it is made to the customer’s own requirements

48
Q

Batch production

A

When a group of identical products are made at any one time

49
Q

Flow production

A

When parts are added to a product as it moves along a production line

50
Q

Methods of ensuring quality

A

Using good quality raw materials, training employees to the highest possible level, maintaining equipment, quality control, quality assurance, and quality management

51
Q

Recruitment process - list

A

Identify a job vacancy, carry out a job analysis, prepare a job description, prepare a person specification, advertise the job and send out applications

52
Q

Selection process - list

A

Collect application forms and CVs, create a shortlist, hold interviews / testing, and inform successful candidate

53
Q

Types of training

A

Induction, on-the-job and off-the-job

54
Q

Financial incentives - list

A

Salary, time rate, overtime, piece rate, bonus and commission

55
Q

Salary

A

Paying a fixed amount of money per year in 12 equal instalments (once every month)

56
Q

Time rate

A

Paying per hour worked

57
Q

Overtime

A

Working over the minimum number of hours required per week

58
Q

Piece rate

A

An amount of money for each item produced in addition to a low time rate or salary

59
Q

Bonus

A

Receiving an additional payment on top of a salary or time rate

60
Q

Commission

A

A percentage of money paid based on the value of sales a person makes

61
Q

Flexible working practices - list

A

Part time, temporary contracts, homeworking, teleworking and job share

62
Q

Types of industrial action

A

Strike, work to rule, sit in, go slow, overtime ban, boycott and demonstration

63
Q

The Equality Act

A

Aims to prevent against discrimination in terms of different protected characteristics, and brings together a number of different aspects of equality

64
Q

The National Minimum Wage Act

A

Sets out the lowest amount of pay a person can receive per hour

65
Q

The Health And Safety At Work Act (HASWA)

A

Sets out the responsibilities employees and employers have concerning health and safety in the workplace

66
Q

The General Data Protection Regulation

A

Sets out guidelines for the collection and processing of personal information from individuals who live in the EU

67
Q

Sources of finance - list

A

Bank loan, loan from family / friends, government grants, bank overdraft, hire purchase and mortgage

68
Q

Types of costs

A

Fixed costs, variable costs and total costs

69
Q

Fixed costs

A

Costs that always stay the same, no matter how many units of a product are made

70
Q

Variable costs

A

Costs that change depending on how many units of a product are made

71
Q

Total costs

A

Fixed and variable costs added together

72
Q

Break-even point

A

When total costs equals total revenue

73
Q

Stages of product development

A

Idea generation, development, prototype and testing, launch to market, and modifications

74
Q

Types of inventory

A

Raw materials, works in progress, and finished goods

75
Q

Non-financial incentives (list)

A

Offering flexible working practices, giving people extra responsibilities to encourage them and providing promotion opportunities, praising people for a job done well, allowing people to work in teams and / or take part in team-building tasks, providing training opportunities, and providing social events

76
Q

Solutions to cash flow problems

A

Find a cheaper supplier, lease machinery or equipment, sell any assets not being used effectively, offer discounts to customers for paying for goods quickly / up front, arrange extra time to pay bills from supplier, increase advertising / sales promotion, and apply for a loan or overdraft from the bank

77
Q

Differences between non-profits and social enterprises

A

Their legal structures are different, and social enterprises are less-regulated by the government

78
Q

Ways to ensure customer satisfaction

A

Providing the highest possible quality product, making sure employees are trained to the highest level and are knowledgeable about products on sale, having a customer care strategy, having a customer complaints procedure, having an after-sales service

79
Q

Customer care strategy

A

Lets customers know about the level of service that will be provided and, if they make a complaint, how it will be dealt with

80
Q

Customer complaints procedure

A

A process that the business and customer follows if a customer is unhappy and makes a complaint - it aims to make sure complaints are handled in the best possible way

81
Q

After-sales service

A

Gives customers the chance to ask questions about their purchase after it has been bought

82
Q

Factors affecting business locations

A

Where the customer is, availability of suitable premises, parking facilities, suitable infrastructure, government grants and incentives, the market segment, employee availability, competition and environmental impact

83
Q

Labour intensive

A

Products made using mainly human effort

84
Q

Capital intensive

A

Products made using mainly machines and equipment (i.e. using technology)

85
Q

Uses of spreadsheets (technology) in finance

A

Record cost information and calculate break-even, prepare cash budgets, prepare income statements, create graphs showing income and expenditure and prepare information that can be exported into other packages

86
Q

Reasons to do target marketing

A

To make sure the product is suitable and specific to the needs of the customer group; to make sure that the product is sold in the most suitable place where the customer can access it; so that a price can be set that will reflect the market segment; and to make sure advertising and promotion campaigns are targeted towards the correct customer group

87
Q

Types of technology which could be used within the operations department

A

Internet websites can be used to compare prices of raw materials and to place orders, spreadsheets and databases can be used to keep track of inventory levels, equipment such as ovens can be pre-programmed to switch on and off at specific times, tablet computers can be used to take orders from customers, delivery vehicles could contain GPS tracking so that deliveries can be tracked, and CAD - computer aided design - software can be used to design products on screen before they are produced

88
Q

Quality control

A

Where products are checked at the beginning and end of the production process for faults

89
Q

Quality assurance

A

Where products are checked at each stage of the production process for faults

90
Q

Quality management

A

Trying to make sure that every product is made perfectly every time, which requires commitment by the whole business towards quality

91
Q

Political influences

A

Influences that come from the actions of the government, e.g. introducing new laws and changing tax levels

92
Q

Economic influences

A

Influences that encourage people to spend money or not spend money, e.g. levels of employment, recession and interest rates

93
Q

Social influences

A

Influences that are concerned with changing opinions, values and people’s beliefs, e.g. tastes in clothing and the increase in different working practises that businesses are using

94
Q

Technological influences

A

Influences that refer to the ways new practises and equipment can affect businesses, e.g. cloud computing and tablet computers

95
Q

Environmental influences

A

Influences that refer to things like weather and the need to be environmentally friendly and sustainable

96
Q

Competitive influences

A

Influences that cover how businesses who offer similar products or services affect each other

97
Q

Financial influences

A

Influences that refer to the availability or lack of finance

98
Q

Human resources influences

A

Influences that cover the employees and managers within the business

99
Q

Current technology influences

A

Influences that refer to technology being used by the business at the present time

100
Q

Stages of product development (GAPTAP)

A

Generate the idea, analyse the idea, produce a prototype, test the product, alter the product, and produce the product

101
Q

Reasons to have a brand

A

So that it’s recognisable to customers and can act as a marketing and promotion tool, to encourage customers to become brand loyal, higher prices can sometimes be charged because people often associate branded products with being of a high quality, and new products can be introduced into the market easily as the brand name is already well known

102
Q

Methods of promotion (list)

A

Special offers, free samples and celebrity endorsements

N5 Business Management (1 decks)

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