Unit 1

Question 1

What is a franchisee?

Answer 1

A person who agrees to sell under licence by a franchisor

Question 2

What is a franchisor?

Answer 2

A business which gives franchisees the right to sell its product or service

Question 3

What are some benefits of a franchise?

Answer 3

• Established brand name
• Established customer base
• Higher chance of survival
• Access to goods and services
• Support and training

Question 4

What are some drawbacks of a franchise?

Answer 4

• Royalty payments
• Complicated application process
• Limited flexibility to make decisions
• Startup can be expensive

Question 5

What is enterprise?

Answer 5

• Showing initiative
• Taking risks
• Willingness to undertake new ventures

Question 6

What does creative thinking produce?

Answer 6

• New opportunities

- unique products

Question 7

What types of protection can a business apply?

Answer 7

• Trademark
• Copyright
• Patent

Question 8

What is a Trademark

Answer 8

Logo/Symbol/Sign of a business that can’t be copied

Question 9

What is a Copyright?

Answer 9

Legal ownership of:
-Books
-Music
-Films
To prevent copying

Question 10

What is a Patent?

Answer 10

A document that represents the right of ownership of an invention, design or process

Question 11

How can you segment a market?

Answer 11

• Age
• Gender
• Income
• Lifestyle
• Life stage

Question 12

What is Branding?

Answer 12

A named product that is seen as different from other products

Question 13

What are the two types of research?

Answer 13

Primary - Done by the business itself

Secondary - Other research collected and analysed

Question 14

What are examples of primary research?

Answer 14

• Focus groups
• Surveys
• Questionnaires
• Experiments

Question 15

What are examples of secondary research?

Answer 15

• Market reports
• Local government statistics
• Telephone directories
• Sales data
• Internet sites

Question 16

What are ways you can add value?

Answer 16

• USP
• Better design
• Improved design
• Branding

Question 17

What is quantitative data?

Answer 17

Expressed as numbers

Question 18

What is qualitative data?

Answer 18

Opinions/judgements/attitudes

Question 19

What are the 4 marketing p’s?

Answer 19

Price, Product, Promotion, Place

Question 20

How can a business increase profits?

Answer 20

• Increase sales Price

- Lower fixed/variable costs

Question 21

What are two types of business objective?

Answer 21

• Financial&raquo_space; Profit & Income / Survival

- Non financial&raquo_space; Personal satisfaction / Helping others

Question 22

What are some small business taxes?

Answer 22

• VAT
• Income tax
• National insurance contributions
• Corporation tax

Question 23

What is calculated risk?

Answer 23

• Reducing risk

- (e.g. 50:50 chance, 1 in 3 chance)

Question 24

What is cash flow impacted by?

Answer 24

• Change in costs
• Business expansion
• Change in credit terms

Question 25

What are interest rates?

Answer 25

The cost of borrowing

Question 26

In what ways can you improve customer service?

Answer 26

• Quick service
• 100% accuracy
• Convenient
• Politeness/Friendliness

Question 27

What increases repeat purchase?

Answer 27

• Effective customer service
• Being cheaper than the competition
• Promotions/special offers

Question 28

What are some examples of short term finance?

Answer 28

• Trade credit
• Overdraft
• Delayed payments
• Credit card

Question 29

What are some examples of long term finance?

Answer 29

• Share capital
• Personal savings
• Retained profit

Question 30

What are examples of stakeholders in a business?

Answer 30

• Managers
• Workers
• Customers
• Competitors
• The government
• Competitors

Question 31

What are the 4 stages of the business cycle?

Answer 31

1> Boom
2>Slowdown
3>Recession
4>Recovery

Question 32

What does Economic activity mean?

Answer 32

Amount of buying and selling businesses and consumers do

Question 33

What should you remember about stakeholders?

Answer 33

They have conflicting interests