Theme 4 - Mrs Carr

Question 1

What is a joint venture?

Answer 1

commercial arrangement between two or more participants who agree to co-operate to achieve a particular objective

Question 2

What is a merger?

Answer 2

When two businesses come together and will usually create a new business

Question 3

What is an acquisition?

Answer 3

When one business buys another and takes control of it

Question 4

What are reasons for businesses joining together?

Answer 4

Increase in finances

To increase the value of their business for shareholders to buy

Tax purposes

Question 5

How would you achieve global competitiveness?

Answer 5

Having production of your business in other countries - this can decrease costs because other countries have things like cheaper minimum wage

Question 6

What benefits do businesses gain from being globally competitive?

Answer 6

Higher market share

Increased profits

Lower costs

Question 7

What is glocalisation?

Answer 7

Combination of the words globalisation and localisation

A business that has kept growing and growing

The business is distributed globally

Question 8

What is meant by ethnocentric?

Answer 8

When a business doesn’t change anything about their product and just keeps everything the same

Question 9

What is meant by polycentric?

Answer 9

A business tailoring their products to the local needs

Question 10

What is meant by geocentric?

Answer 10

This is a mix of both ethnocentric and polycentric approaches

Question 11

What is the Ansoff’s Matrix?

Answer 11

A strategic planning tool businesses can use to help their future growth

Question 12

What 4 things are included in Ansoff’s Matrix?

Answer 12

Market development

Market penetration

Diversification

Product development

Question 13

Why might a business change their marketing mix?

Answer 13

Changing trends

Demographics

The size and scale of the business changing

Question 14

What is a niche market?

Answer 14

A small, specialised market for a particular product or service

the product or service will have a USP - unique selling point

Question 15

Advantages of a Niche market?

Answer 15

Higher profits because businesses can charge higher prices for the product

Less competition

Brand loyalty

Question 16

Disadvantages of a niche market?

Answer 16

Lack of economies of scale

May not get as many sales since the product and service is very specific

Question 17

What is meant by ethics?

Answer 17

Ethics is about doing the right thing. Ethical behaviour requires firms to act in ways that stakeholders consider to be both fair and honest.

Question 18

What are some advantages of behaving ethically?

Answer 18

Higher Revenue - demand from positive consumer support

Improved brand awareness and recognition

Better employee motivation and recruitment

New sources of finance - ethical investors

Question 19

What are some disadvantages of behaving ethically?

Answer 19

Higher costs - sourcing from fair trade suppliers rather than lower cost suppliers

Higher overheads - training and communication of ethical policy

A danger of building up false expectations

Question 20

What is corporate social responsibility (CSR)?

Answer 20

When a business aims to contribute to social goals

This may be done by them being more sustainable having lower emissions that contribute to global warming

They may engage in voluntary or ethically orientated practices