Theme 1 Flashcards

1
Q

Methods of differentiation

A
  • reputation
  • customer service
  • value for money
  • product features
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2
Q

Factors leading to a change in demand - non-price

A
  • price of substitutes
  • alternative brands
  • price of compliments
  • changes in consumer income
  • trends in fashion and tastes
  • marketing, advertising and branding
  • population structure/demographics
  • time of year
  • weather and climate
  • external shocks
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3
Q

Factors leading to a change in supply - non-price

A
  • cost of production
  • introduction of new technology
  • indirect taxes e.g., VAT
  • government subsidies
  • external shocks
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4
Q

Factors influencing PED

A
  • availability of substitutes
  • frequency of purchase
  • necessities
  • luxury goods
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5
Q

Factors influencing YED

A

Luxury goods - income increase = demand increase

Normal goods - income increase = demand increase

Inferior goods - income increase = demand decrease

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6
Q

FAC

A

Function
Aesthetic
Cost

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7
Q

Types of promotion

A
  • personal selling
  • direct marketing
  • sponsorship
  • public relations (PR)
  • below-the-line marketing
  • above-the-line marketing
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8
Q

Sales promotions

A
  • BOGOFF
  • point of sale
  • special events
  • samples/giveaways
  • money-off coupons
  • price discounts
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9
Q

Digital communications

A
  • online adverts
  • viral strategies
  • consumer generate content
  • social media
  • ‘advergaming’
  • mobile communications
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10
Q

Ways to build a brand

A
  • USP/differentiation
  • advertising
  • sponsorship
  • social media
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11
Q

Pricing strategy depends on…..

A
  • the product/service itself
  • competitors in the market
  • aims and objectives of the business
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12
Q

Types of pricing

A
  • cost plus
  • price skimming
  • penetration
  • predatory
  • competitive
  • psychological
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13
Q

4-stage distribution channel

A

Manufacturer
|
Wholesaler (B2B)
|
Retailer (B2C)
|
Consumer

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14
Q

3-stage distribution channel

A

Manufacturer
|
Retailer
|
Consumer

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15
Q

2-stage distribution channel

A

Manufacturer
|
Consumer

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16
Q

Staff as a cost

A
  • cost of recruitment
  • cost of training
  • cost of paying minimum wages
  • cost of paying staff salaries and wages
  • cost of staff welfare
  • cost of redundancy
17
Q

Decentralised structure

A

Where a business divides up the organisation of its business into areas. The business will have seperate budgets for each area.

18
Q

Centralised structure

A

Where a business has its organisation of management and administration at one central head office. The business has one central shared budget.

19
Q

Tall structure

A
  • lots of promotional opportunities
  • slow decision making
  • work shared = less stress
  • everyone knows their place in the hierarchy, very organised
20
Q

Flat structure

A
  • wide span of control
  • short chain of command = quick information flow
  • so quick decision making
  • e.g., restaurants and web design companies
21
Q

Matrix structure

A
  • in a business where there is more than one product or more than one project running at one time this is suitable.
  • e.g., car manufacturers
  • flexible = staff can jump in and out of different job roles (variety for them)
22
Q

Taylor’s scientific management

A
  • workers motivated if they are paid as per their output.
  • breaking down complex tasks into simpler ones.
  • standardising work processes, providing workers with clear instructions + training to maximise efficiency

Pro - improved training = job satisfaction + better performance

Con - workers may disengage if they are reduced to work in a machine like system = mistakes

23
Q

Mayo’s human relations

A
  • importance of social factors in the workplace:
    COMMUNICATION
    MOTIVATION
    JOB SATISFACTION
  • these improve productivity, job satisfaction, relationships between employer-employees.

Pro - better communication = reduces misunderstandings/conflicts

Con - limited application = businesses that encourage independence and autonomy for employees might not be able to use it.
- time-consuming

24
Q

Maslow’s hierarchy of need

A

5 tiers of human needs:
SELF-ACTUALISATION = morality
ESTEEM = confidence, respect for others
LOVE/BELONGING = friendship, family
SAFETY = job security, safe working conditions
PHYSIOLOGICAL = access to clean water and food

Pro - higher employee satisfaction = increased productivity + lower turnover rates

Con - expensive in offering employee perks

25
Herzberg’s two factor theory
Hygiene factors: - pay fair wages/salaries - offering excellent working conditions - offer employment contracts which provide job security Motivating factors: - build a recognition and rewards culture. - offer opportunities for growth and development. - provide challenging work which requires problem solving. These two types of factors work together to bring about employee motivation and job satisfaction Pro - motivation = increased productivity, less labour turnover Con - recognition and rewards culture could be expensive depending on whether the rewards are financial or not.
26
Financial motivation methods
- Piece work (paid per finished item/unit) - Commission (% of the unit price or per unit sold) - Bonus - Profit share (annual dividend based on profits made) - Performance related pay (e.g., excellent = 10% bonus on pay)
27
Non-financial motivation methods
- Delegation (given more responsibilities) - Consultation (involved in discussions with management) - Empowerment (employee gets authority to delegate) - Team working - Flexible working - Job enrichment (higher responsibility + greater variety of tasks) - Job rotation (one task to another) - Job enlargement (more tasks of the same responsibility)
28
Autocratic leadership
- when management make decisions with little or no input from employees - management dictate work methods and processes
29
Democratic leadership
- allows employees to help make decisions. - the leader’s role is to decide which staff members get to contribute to the decisions that are made.
30
Paternalistic leadership
- A leader makes the right decisions for the employees they are responsible for. - There is a dominant authority figure who expects loyalty and trust from their employees.
31
Laissez-faire leadership
- Employees can carry out activities and make decisions freely. - Very relaxed work environment = little direction and guidelines. - The leader is still ultimately responsible for the decisions made.
32
Barriers to entrepreneurship
- Entrepreneurial capacity (the ability to use entrepreneurial skills to create a widespread development of entrepreneurial mind-sets which benefits individuals and society) - Access to finance - Lack of training/know-how - Fear of failure - Lack of confidence
33
Entrepreneurial characteristics
- creativity - hard-work - resilience - initiative - self-confidence - risk-taking
34
Entrepreneurial skills
- communication - team working - problem solving - organisation - numeracy - IT skills
35
Non-financial motives for setting up a business
- independence - flexibility - ethical reasons - social purpose - personal challenge
36
Opportunity cost
Can be measured as the cost of foregoing the next best alternative.
37
Trade-off
less of one is exchanged for more of another or a compromise.
38
How to move from an entrepreneur to leader
- learning to delegate - trusting others - listen to others - be less reactive - development emotional intelligence: SELF-AWARENESS SELF-MANAGEMENT SOCIAL AWARENESS RELATIONSHIP MANAGEMENT