Section 3: Enterprise, business growth and size Flashcards

1
Q

Entrepreuer

A

a person who is willing and able to create a new business idea or invention by taking risks

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2
Q

Business Plan

A

A detailed written document outlining the purpose and aims of a business which is often used to persuade lenders or investors to finace a business propsal.

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3
Q

Revenue

A

The amount a business earns from the sale of its product.

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4
Q

business start up

A

A newly formed business. They usually start small, but some might grow to become bigger.

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5
Q

What do enterpreneurs do

A
  • They organise reasources
  • They make business decisions
  • They take risks
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6
Q

haracterisitics and skills required to be an enterprenuer

A
  • Communication
  • Self confidence
  • Problem solving
  • Organisation
  • Team work
  • risk taker
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7
Q

Elements of a business plan

A
  • Business objectives
  • Business location
  • Business idea
  • Business marketing
  • SOurce of finacne and profits
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8
Q

How do business plans help enterprenuers

A
  • Reduce risk
  • Increases Value
  • Provides a direction
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9
Q

Government suppor for business start ups

A
  • Training and support sessions
  • Enterprise xones
  • Finance
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10
Q

Ways to measure business size

A
  • Size of workforce
  • Value of capital employed
  • Value of business sales
  • Value of Business output
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11
Q

Size of workforce

A

How many workers in a business

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12
Q

Value of capital employed

A

A measure of all the money

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13
Q

Value of business sales

A

The total sales revenjue privce x quanitity

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14
Q

Value of business output

A

Financial worth a goods produced

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15
Q

Reasons why businesses groew

A

10 Market share
2) Market power
3) Easier access

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16
Q

Internal growth

A
  • Greater market share
  • New technology
17
Q

Advantages for internal growth

A
  • Pace growth
  • less risky
18
Q

Disadvantages for internal growth

A
  • slow pace
  • limited finance
19
Q

Inorganic External growth

A

2 companies form one

20
Q

Vertical Interigation

A

take over another firm in the supply chain

21
Q

Forward Vertical interegation

A

Take over of a firm forward dairy to icecream

22
Q

Backwards vertical Integeration

A

Take over of a firm backwards in the supply chain
ice cream shop to ice cream factory

23
Q

Horizontal integration

A

takeover of a firm at the same stage of the production process

24
Q

Advantages of vertical integreation

A
  • Reduce cost of production
  • Competitive
  • Reduce risk
    _ Quality
25
Disadvantages of verticla integreation
- Little expertise - Culture clash
26
ADvantages of horizontal integreation
- Increase market share - Reduce competetion - New knowledge gained
27
Disadvantages of horizontal integreation
- Cultural clash Diseconomies
28
Problems of growth
- larger firms are harder to control - Poor communication - High costs lead to cash flow problems - Difficulties in taking over
29
Reasons why small firms exists
- Personalised service - Repond quickly - unable Access external finace
30
Advantages of small firms
- Highly customised and unique - Personal realshionships - Changing market conditions
31
DisAdvantages of small firms
- Limited access to finance - Struggles to take holidays - Hard to get high quality staff
32
Why do some business fail
- Finacial factors - Poor managment - Overtrading