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Business A Level > Theme 1 > Flashcards

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
Q

Herzberg’s two factor theory

A

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
Q

Financial motivation methods

A
  • 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
Q

Non-financial motivation methods

A
  • 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
Q

Autocratic leadership

A
  • when management make decisions with little or no input from employees
  • management dictate work methods and processes
29
Q

Democratic leadership

A
  • 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
Q

Paternalistic leadership

A
  • 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
Q

Laissez-faire leadership

A
  • 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
Q

Barriers to entrepreneurship

A
  • 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
Q

Entrepreneurial characteristics

A
  • creativity
  • hard-work
  • resilience
  • initiative
  • self-confidence
  • risk-taking
34
Q

Entrepreneurial skills

A
  • communication
  • team working
  • problem solving
  • organisation
  • numeracy
  • IT skills
35
Q

Non-financial motives for setting up a business

A
  • independence
  • flexibility
  • ethical reasons
  • social purpose
  • personal challenge
36
Q

Opportunity cost

A

Can be measured as the cost of foregoing the next best alternative.

37
Q

Trade-off

A

less of one is exchanged for more of another or a compromise.

38
Q

How to move from an entrepreneur to leader

A
  • learning to delegate
  • trusting others
  • listen to others
  • be less reactive
  • development emotional intelligence:
    SELF-AWARENESS
    SELF-MANAGEMENT
    SOCIAL AWARENESS
    RELATIONSHIP MANAGEMENT

Business A Level (6 decks)

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