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Business Studies > The Business Environments > Flashcards

The Business Environments Flashcards

1
Q

What are the factors of the Micro environment

A

-it’s an internal environment
- uses the Business functions and the Strengths and Weaknesses of the SWOT analysis for environmental scanning

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2
Q

What are the factors of the Macro environment

A
  • is an external environment
  • Uses PESTLE and the Threats and the Opportunities of the SWOT analysis for environmental planning
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3
Q

What are the factors of the Market environment

A
  • is an external environment
  • Uses Porter’s Six model analysis for environmental scanning
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4
Q

What is environmental scanning

A

The process of obtaining information about events that may have an impact on the performance of the business

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5
Q

What are the functions of environmental scanning

A
  • ensures that the business is ready for developments in all environments
  • realigns resources to take advantage of opportunities and overcome threats
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6
Q

What is a crisis

A

A quick and unexpected change

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7
Q

What are trends

A

Changes that occur over a period of time

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8
Q

Give examples of strengths

A

Competitive price
Location
Patents
Business culture
Good marketing and strong brad
Access to financing
Operational efficiency and good quality

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9
Q

When can Location be considered as a Strength in a business

A

-When the business and it’s products are easily accessible to the target market
-When it’s close to the source of raw materials used to produce goods/ render services

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10
Q

Why can patents be considered as a Strength

A

Because they limit potential competitors

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11
Q

Why is Businesses Culture be a possible strength

A

Because it gives consumers confidence in the ability and reliability of the business

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12
Q

Why are operational efficiency and good quality strengths

A

Because they help differentiate businesses from their competitors and therefore enabling greater profitability

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13
Q

What are Opportunities

A

External factors which present the business with the chance to outperform their competitors

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14
Q

What are Threats

A

External factors which could hamper the success or growth of the business

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15
Q

What can be Used to identify Threats and Opportunities

A

PESTLE and Porter’s six Forces

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16
Q

What is Porter’s Six Force Model Analysis used for

A

To assess the attractiveness of a market

17
Q

What does at attractive market have

A

-High level of profits
- High barriers to enter
- Free substitute products/ services
- Low level of competition
- Weak supplier bargaining power
- Weak buyer bargaining power

18
Q

What are the characteristics of an unattractive market

A
  • Low level of profits
  • Low barriers to enter
  • Many substitute products/ services
  • high level of competition
  • Strong supplier bargaining power
  • Strong buyer bargaining power
19
Q

What are the factors of Porter’s Model

A
  1. Threat if new entrants
  2. Rivalry amongst current competitors
  3. Threat of substitute products
  4. Power of the supplier
  5. Bargaining power of the buyers
  6. Complementary products
20
Q

What are possible barriers that may make it hard to enter a market

A
  • The need of a high capital contribution
  • Strong Trade Marks of existing businesses
  • High customer switching costs
21
Q

When is the rivalry amongst current competitors high

A

-When there’s too many competitors
-When there’s a low level of customer loyalty

22
Q

What are substitute products

A

Different products that satisfy the same need

23
Q

What are examples of substitute products

A

Any other school instead of Midstream
They both satiety the need for education

24
Q

When is the power of the supplier high

A

-When there are few suppliers
-When it is difficult to forward integrate

25
Q

Why is the power of suppliers high when there are few suppliers

A

Because supplier may not be available to deliver products at the time they are needed, this causes lack of stock and therefore loss of profitability for the business because consumers don’t have products to buy since the supplier didn’t pitch

26
Q

When is the bargaining power of buyers strong

A

-When the buyer buys in bulk
- when few buyers exist
- when it’s difficult to integrate backwards

27
Q

Why is the bargaining power of buyers strong when buyers are few

A

Because the business would rather have those little buyers than no buyers at all , so the business feels the need abide to any requests of the buyers even if their requests are unethical

28
Q

What is the function of complimentary products and give an example of a complimentary product

A

Complimentary products complement and increase the demand of the original product to encourage more profitability
Air-pods are a complementary product that complements IPhone 11

29
Q

What are the PESTLE elements

A

Political
Economical
Social
Technological
Legislation/ Legal
Environmental

Business Studies (12 decks)

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