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Yr 10 Business, Term1 > Term 1 > Flashcards

Term 1 Flashcards

1
Q

What are the key roles of a business?
(nine)

A

-Profit -Quality -Wealth -Choice -Income -Innovation Employment -Quality of life -Entrepeneurship and risk

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2
Q

What is a Sole trader?

A

An incorporate business with one owner
P: -Owner retains profit
C: -Funding from owners own funds/personal

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3
Q

What is a Partnership?

A

An unincorporated business that has more than one owner
P: -Allow businesses access specialist knowledge of possible investors
C: -Unlimited liability means partners are individually liable for debts of the business

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4
Q

What is a Trust?

A

Is an organisation that is responsible for managing assets on behalf of an individual or a group of individuals
P: -Decisions & allocations of assets determined by investment professionals
C: -There is a element of risk for investors as assets not managed by the owners

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5
Q

What is a private company?

A

A private company is usually small and has only a limited number of owners (up to 50 owners).
P: -Access to enterprise from owners
-Owners not responsible for company debts
-Decision making and responsibility within the business is shared

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6
Q

What is a public company?

A

A public company is usually very large and can have unlimited owners. It’s a business that is listed on the stock exchange
P: -Anyone can own shares
-Shareholders elect management

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7
Q

What is a company limited by guarantee?

A

Non-profit organisation

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8
Q

What is a strategic business plan?

A

Strategic business plan is a step-by-step guide which a business puts in writing to achieve its business goals and objectives. The business plan defines the business, sets out its goals and describes the strategies that will be used to achieve those goals.

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9
Q

What are the primary elements of a business plan?

A

-Vision statement
-Mission statement
-Executive statement
-Operational plan
-Marketing plan
-Financial statement

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10
Q

What is a vision statement?

A

A vision is aspirational. Vision is what the owners see for the future. Vision statements are future-based and meant to inspire and give direction to employees of the company rather than customers.

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11
Q

What is a mission statement?

A

A mission is actionable. Outlines clearly what the ambitions of a business are - what the business hoped to achieve for its stakeholders. While a mission statement focuses on the purpose of the brand, the vision statement looks to the fulfillment of that purpose

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12
Q

What does a business plan provide?

A

Necessary for company growth and success. Provides companies with the tools to:
-Track growth -Establish a budget
-Prepare for unforeseen changes in the marketplace

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13
Q

What are financial goals?

A

Relate to increasing or gaining maximum wealth for the owners of a business

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14
Q

What are social goals?

A

Relate to the role of a business in the community in which it operates

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15
Q

What are personal goals?

A

Personal goals of the owner will be reflected in the overall goals of the business and its future direction

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16
Q

What does the acronym SMART goals stand for?

A

Specific
Measurable
Achievable
Realistic
Timely

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17
Q

What are the four stages of a business life cycle?

A

-Establishment stage
-Growth stage
-Maturity stage
-Post-Maturity

18
Q

What is the Establishment stage?

A

-Idea generation, developed by an entrepreneur or a small group of individuals
-Limited resources, limited financial and Human Resources struggle to secure funding and attract investors
-High level of uncertainty, business idea and market demand are still untested
-Likely to have low sales and revenues

19
Q

What is a business?

A

A business is any organisation which provides a service, product, or good that meets a need of society in some way.

20
Q

What four sectors do business’s operate in?

A

-Primary
-Secondary
-Tertiary
-Quaternary

21
Q

What is a Primary Sector?

A

Businesses extract or grow something using the natural resources of the country.
Examples include mining and farming.

22
Q

What is a Secondary Sector?

A

Involves a process of adding value to raw materials combined with labour and capital equipment to produce a product. All manufacturing businesses operate in the secondary industry.

23
Q

What is the Tertiary Sector?

A

The tertiary sector of the economy, also known as the service sector, includes industries that provide services to individuals and businesses, such as healthcare, education, retail, and finance.

24
Q

What is the Quaternary Sector?

A

The quaternary sector of the economy refers to knowledge-based industries and services, such as research and development, information technology, and professional services. These industries are focused on the creation and management of knowledge and information.

25
Q

What is liability?

A

Liability is a legal responsibility or obligation to pay a debt, compensation, or make amends for a wrong committed. It can refer to a person or a business being accountable for damages, losses, or harm caused to another party.

26
Q

What is a business life cycle?

A

The business life cycle is a model that describes the stages a business goes through from its inception to its eventual decline or rejuvenation.

27
Q

What is the Growth stage?

A

The growth phase is the stage in a business’s life cycle where the company experiences a significant increase in revenue and market share. During this phase, the company expands its operations, enters new markets, and increases its production capacity.

28
Q

What is the Maturity stage?

A

The maturity phase of the business life cycle is characterized by a slowdown in growth and stability in the market. During this phase, the company has established its product or service offerings, and has a loyal customer base.

29
Q

What is the Post-Maturity stage?

A

The post-maturity stage of the business life cycle refers to a period in which a mature business begins to decline and its growth slows down or stops. The company may struggle to remain competitive in the market.

30
Q

What are 3 options that companies can choose to do in the Post-Maturity stage?

A
  • Diversify (Renewal)
    -Continue as usual (steady state)
    -Cessation (cease business)
31
Q

What is diversification (Post-Maturity)

A

One option for a business in the post-maturity stage is to diversify its offerings. This can be done by expanding into new markets, creating new products or services, or acquiring or merging with other companies.

32
Q

What is a steady state? (Post maturity)

A

In a steady state, the business has established a strong market position and has a loyal customer base.

33
Q

What is cessation/exit? (Post-maturity)

A

A third option for a business in the post-maturity stage is to exit the market altogether. This may involve selling the business to a larger competitor, spinning off unprofitable business units, or liquidating its assets.

34
Q

What are factors in the external environment?

A
  • Climate - Economy - Technology - Legal - Competition - Media - Fashion
35
Q

What are factors in the internal environment?

A
  • organisational culture - human resource - organisational structure - physical assets - profit and cash flow - management
36
Q

What is the internal environment?

A

The internal environment is easier to manage than the external environment because it is within the business’s direct control.

37
Q

What is the external environment?

A

This is the wider environment in which a business operates.

38
Q

Why do business’s fail?

A

One of the main reasons businesses fail is because they do not have a business plan.

39
Q

What is a competitive advantage?

A

Identifying and Sustaining a Competitive Advantage
Competitive advantage is the reason customers buy one business’s product over another’s. Sustaining a competitive advantage can require a business to be flexible and to respond to changing consumer tastes and preferences.

40
Q

What is under-capitalisation?

A

Small business owners often have to start their business using their own money and they often do not realise just how much money they will need.
When starting a new small business it is essential to have money not only to run the business but also to pay living expenses for the first few years until a bank loan can be obtained.

Yr 10 Business, Term1 (1 decks)

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