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Edexcel GCSE Business > Understaning External Influences > Flashcards

Understaning External Influences Flashcards

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1
Q

Eight types of stakeholders

A

Shareholders
Employees
Customers
Managers
Suppliers
Local community
Pressure groups
Government

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2
Q

Shareholders

A

Investors who are part-owners of a company

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3
Q

Private limited company

A

A incorporated business that is owned by shareholders who invest in the business in return for a share of the profits and voting rights at the annual general meeting

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4
Q

Public limited company

A

An incorporated business that can sell shares to the public

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5
Q

Stock exchange

A

A pave where shares in PLCs can be bought and sold

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6
Q

Shareholders objectives

A

To make money by being given a share of their profits of the business in return for their investments
To make money if they sell shares

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7
Q

Main objectives of employees

A

To get the best possible pay and rewards for doing their jobs
To keep their jobs and to ensure that their job is secure

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8
Q

Advantage to a business of having satisfied employees as stakeholders

A

They actually do the business’s work so if they are satisfied they can have a big impact on the reputation and overall performance of a business

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9
Q

Stakeholders - Customers

A

Stakeholder with an influence over business because they buy a business’s products and services. If they buy a lot from that business, its sales will increase and the business will do well. If customers stop buying the business’s products , the business’s sales will decrease and lower business’s profit

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10
Q

Customers’ objective

A

To get the best possible quality service or product
To get best value for money for that product or service

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11
Q

Stakeholders - Managers

A

Senior employees within a business
They can influence a business because they ensure that the business’s employees work well, either in teams or individually
This then has an influence on the way in which employees provide customers with the products or services they want
Managers are also influences by the business because it pays their wages

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12
Q

Objectives of managers

A

To make sure the business succeeds so that they get paid
To ensure that their jobs are secure

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13
Q

Stakeholders - suppliers

A

Can have a big influence on businesses because they provide the goods or services that the business needs in order to keep on operating
Suppliers need to trade with businesses to increase their sales and are dependent on the success of the businesses that buy from them
Makes it more likely that the business will be able to egotists better payment terms or savings that they can pass on their customers

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14
Q

Suppliers objectives

A

To increase sales and profits
To encourage businesses to buy from them again in the future
To grow their business

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15
Q

Payment terms

A

The period of time that a business has to pay its suppliers

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16
Q

Stakeholders - local community

A

Is a business stakeholder because the work of the business has an influence on them
They can support or object to the way in which it operates

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17
Q

Local community objectives

A

To look after the local area and the people within it

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18
Q

Stakeholders - pressure groups

A

A group of people who join together to try to influence businesses or the government for a particular cause.

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19
Q

Ways a pressure group can influence the way a business operates

A

Encouraging consumers to increase the amount of a product or service that is used
Persuading customers to boycott or stop buying from a business
Encouraging businesses to behave in more ethical ways that help other stakeholders

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20
Q

Pressure groups objectives

A

Trying to change something

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21
Q

Stakeholders - government

A

Large influence because they are responsible for running the country
Influence all aspects of how a business operates

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22
Q

How is the relationship between stakeholders and a business is defined ?

A

The business affects stakeholders
Stakeholders have an impact on a business
A business must try to satisfy all of its different stakeholders and manage any conflict between them

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23
Q

Conflict

A

A serious disagreement, usually between people, countries or ideas.

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24
Q

Shareholders impact on business activity

A

Sets the aims and strategy for the business, including how it behaves
Provide funding and investment to start up and expand a business

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25
Q

Employees impact on business activity

A

Provide good service, which usually results in higher sales and profits

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26
Q

Customers impact on business activity

A

Buy products and services
Make recommendations for how to improve products and services
Recommend the business to friends and on social media

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27
Q

Managers impact on business activity

A

Manage employees who do the day-to-day work of the business
Communicate employees’ needs to senior management
Communicate the business’s needs to employees

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28
Q

Suppliers impacts on business activity

A

Provide the business with the materials it needs for its products or services
Affect the amount of products and services that can be produced and sold, which can have an impact on the business’s sales and reputation

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29
Q

Local community impact on business activity

A

Support their local business by buying its products or services
Object to the business if it has a negative impact on the local community or local environment

30
Q

Pressure groups impact on business activity

A

Change the business’s practices, such as its delivery times
Improve employees’ conditions
Influence customers’ opinions of the business and their buying habits

31
Q

Government impact on business activity

A

Charges the amount of tax that the business has to pay
Passes new laws relating to the business and its industry
Promotes different types of business activity by providing special funding for particular activities

32
Q

Disadvantages to a business when two of its stakeholders are in conflict with each other

A

If the owners are the managers as well there might be more responsibility and stress

Workers - There may be job losses if jobs duplicated in a merger or takeover as only one person is needed for that job. Shareholders will expect costs to be cut.

Customers - Prices could rise. With a merger or takeover, there might be fewer competitors, so the business could raise prices.

33
Q

Different types of technology used by business

A

E-commerce
Social media
Digital communication
Payment systems

34
Q

Advantages of using e-commerce

A

Can trade around the world, at any time of day or night
Can process order immediately
Can give real-time order updates to customers
May be able to avoid running a retail shop or other outlet and so reduce costs
Easier ordering process for customers

35
Q

Disadvantages of using e-commerce

A

Can be expensive to keep up with technology
Customers may have security concerns over fraud and the security of their account details
Can make it harder to build relationships with customers, leading them to make purchase decisions because of price rather than brand loyalty

36
Q

Real-time

A

Live or as it happens

37
Q

Benefits of payment systems

A

Easy
Fast
Open 24 hours a day, 7 days a week
Allow people to order immediately which is good for customer service
Trends in sales can be identified quickly
Can work in many different currencies
Customers have come to expect it and may choose not to shop with a business if digital payment is not available

38
Q

Drawbacks of payment systems

A

May be vulnerable to fraud
May be additional fees to be paid by the business

39
Q

Three main influences that technology has on the activities of a business

A

Influence on sales
Influence on costs
Influence on the marketing mix

40
Q

Technologies influence on a business’s sales

A

Tech means sales can be made at any time and any location. This helps increase its sales
Use technology in their warehouses to track the amount of stock available. Can show customers how many of a product or service is available before customers make a purchase decision. Increase customer satisfaction

41
Q

Technologies Influence on costs

A

Keeps costs low
Avoiding paperwork by using online record keeping
Enabling real-time purchasing through online transactions
Reducing travel costs by hosting online meetings
Not needing an office or high-street shop because staff can work from home

42
Q

Technologies influence on the marketing mix - price

A

Customers shopping online will have a lot of businesses to choose from, so technology helps businesses to lower their prices in order to compete

Customers can use online price comparison websites, which encourages business to lower prices

Businesses can operate more efficiently and reduce costs, allowing them to lower their prices and attract customers while still making a profit

43
Q

Technologies influence on the marketing mix - product

A

Businesses can use technology to take advantage of the latest methods to produce goods and services

Businesses can use technology to offer new ways to access products or services

Customers can customise their product choices, which can be produced quickly using robotics

44
Q

Technologies influence on the marketing mix - place

A

Bus can use social media to make customers aware of their brands products
Bus can create reliable, easy-to-use e-commerce websites that make purchasing easy for customers
Cust can be impressed by a good e-commerce website or put off by a bad e-commerce website

45
Q

Technologies influence on the marketing mix - promotion

A

Businesses can use cheap digital promotional materials, such as email newsletters, which cost less than physical promotional materials such as billboards
Businesses can target their advertising at customers by using cookies to track what a particular customer has even looking at online

46
Q

Cookies

A

Small files stored on a customer’s computer when the customer visits a website, which record details about that visit and can be accessed by the website when the customer visits again

47
Q

Legislation

A

The laws that a country must comply with

48
Q

The purpose of legislation

A

Protecting the rights of consumers through consumer law
Protecting the rights of employees and employers through employment law

49
Q

Consumer law

A

Relates to the quality of products or services offered by businesses and the rights of consumers relating to those products or services

50
Q

Consumer Rights Act

A

Products must be of satisfactory quality, fit for purpose for which they are supposed to be used
Cust have the legal right to reject goods within 30 days
After 30 days, cust have the right to a repair, replacement or refund for a faulty product
The retailer is responsible for safe delivery of goods
Bus. Must provide the service with reasonable care
Businesses are not allowed to enforce unfair terms when selling goods or services

51
Q

Reasonable care

A

In consumer law, this means offering a service that it is suitable for customers, such as providing a meal that can be eaten

52
Q

Employment law

A

Relates the way in which employees are hired and treated by businesses and sets out the responsibilities that businesses have towards their staff

53
Q

Key areas of employment law

A

Recruitment
Pay
Discrimination
Health and safety

54
Q

How employment law ensures that employers recruit in a fair way

A

Advertising vacancies
Selecting candidates
Interviewing candidates
Offering a candidate the job
Preparing the employee to start their job
Producing the employee’s contract of employment
Conducting the employee’s induction programme once they start their job

55
Q

Induction

A

The period of time after an employee starts a job when they must be shown how to work safely and within the employer’s expectations

56
Q

Comply

A

Obey a command or meet a set of standards

57
Q

Minimum wage

A

The lowest legal rate of pay for employees, depending on their age and their type of employment

58
Q

Apprenticeship - minimum wage requirement - implication for a business

A

Businesses must pay a specified minimum rate to any apprentice employed by them in their first year. The rate is set by the government and changes each October. It goes up to the National Minimum Wage

59
Q

National Minimum Wage - implication for a business

A

Businesses must pay a specified minimum wage rate to any employee under the age of 25. These rates are set depending on the employees age
Under 18
18-20
21-24

60
Q

National Living Wage - implication for a business

A

Businesses must pay a specified minimum wage to any employee over the age of 25

61
Q

Discrimination

A

When someone is treated differently to someone else because of a particular characteristic, such as a disability, their ethnicity or their sex.

62
Q

Law that prevents discrimination

A

Equality Act 2010

63
Q

Protected characteristic

A

Characteristics that cannot be used in the recruitment process to reject a candidate, such as age, disability, sex or gender, marriage status, pregnancy, race, religion or belief or sexual orientation.

64
Q

Impacts of legislation - cost

A

Training
Equipment - changed or updated
Pay
Administration
Licenses or professional services

65
Q

Positive consequences of meeting and not meeting legal obligations

A

Positive reputation
Customers and other stakeholders feel they are being treated fairly
Higher sales due to customers being attracted to buy from the business because of its good reputation
Better candidates for jobs with the business, because people are attracted to work for the business

66
Q

Negative consequence of meeting and not meeting legal obligations

A

Business may be taken to court
Negative media stories about the business, leading to a bad reputation
A customer or employee is injured, suffer ill-health or is even killed as a result of the business’s failure to meet legal obligations
Business is closed down temporarily or permanently

67
Q

Levy

A

A tax on a particular product or service

68
Q

Aspects of the economic climate that have an impact on businesses

A

Unemployment
Changes in exchange rates
Government taxation
Changes in interest rates
Inflation
Changing levels of consumer income

69
Q

How does unemployment being low and falling affect businesses ?

A

there are fewer potential employees that can hire
They may need to put up their wages in order to attract potential employees to work for the business
People’s income is higher, so they have more money to spend on products and services because they are in work and receiving wages
Employees are happier because their jobs feel secure as the economy is doing well

70
Q

Globalisation

A

When businesses operate on an international scale and gain international influence or power

Edexcel GCSE Business (9 decks)

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