Unit 1 Chapter 2 Flashcards
Internal Business Environment and Planning
internal environment
factors within a business that a business has control over
internal environment factors (9)
- resources
- locations
- sources of finance
- existing vs establishing
- support services
- business types
- business models
- SWOT analysis
- CSR
external environment
surrounding factors that can impact a business, which it
has minimal control over. macro and operating
factors.
operating factors (4)
- customer needs and expectations
- special interest groups
- competitor’s behaviour
- suppliers and the supply chain
macro factors (6)
- CSR considerations
- global considerations
- technological considerations
- economic conditions
- legal and government regulations
- societal attitudes and behaviour
order of environments
internal) operating) macro)
types of businesses (6)
sole trader, partnership, private limited (Pty Ltd), public listed (Ltd), social enterprise, government business enterprise (GBE)
sole trader
- 1 individual owner
- unincorporated
- unlimited liability
- profit: owner
partnership
- 2-20 owners
- unincorporated
- unlimited liability
- profit: partners
private limited company (Pty Ltd)
- up to 50 shareholders
- only specific people
- incorporated
- limited liability
- shares to private
public listed company (Ltd)
- unlimited shareholders
- any people
- incorporated
- limited liability
- shares to public
social enterprise
- aims to fulfil a social or environmental need
- NOT a business structure
- must give 50% profit
- profit: reinvested or donated
government business enterprise (GBE)
- owned and operated by the government
- caters for social needs e.g. transport, housing, communication
- profit: reinvested or to government
unincorporated vs incorporated
- business = owner, same legal entity
- business ≠ owners, different legal entity
unlimited vs limited liability
- owner is responsible for debt
- shareholders only liable to extent of original investment
types of business models (6)
online, direct-to-consumer, bricks-and-mortar, franchise, importer, exporter
online business
operates online
e.g. eBay
direct-to-consumer business
products sold directly to customers with no intermediaries
e.g. apple store
bricks-and-mortar business
has a physical store presence
e.g. woolworths
franchise
grants another person the right to operate under its name and sell its goods and services
e.g. McDonalds
importer
purchases goods and services from overseas and sells them in its home country
e.g. Toyota
exporter
produces goods and services in its home country and sells them to overseas buyers
e.g. iron ore
purchasing an existing business
obtain: premises, equipment, stock/goods, employees, customer accounts, goodwill
establishing a new business
consider: location, business name registration, suppliers, staff employment
business resources (3)
- natural resources e.g. wood
- labour resources e.g. barista
- capital resources e.g. forklift
business locations (4)
shopping centres, shopping centres, home businesses, online businesses
sources of finance (4)
equity capital, debt capital, grants, overdraft facilities
equity capital
- money from investor for partial ownership
- business doesn’t repay
- investor owns ^50% = major influence
- personal/private/public
debt capital
- lent from an external source
- paid back with interest
- e.g. loans
grants
- provided by government for a specific reason
- helps business
- business must meet set conditions
overdraft facilities
- between bank and business
- account can go below $0
- business must prove they can repay
- high interest rate, expensive
business support services (7)
legal support, financial support, technological support, community-based support, formal networks, informal networks, business mentors
parts of a business plan (8)
- executive summary
- business owners
- supporting documents
- CSR
- product
- financial plan
- marketing plan
- operations plan
SWOT analysis
is a planning analysis tool that helps a business identify its internal strengths and weaknesses, as well as any external opportunities and threats
corporate social responsibility (CSR)
the ethical conduct of a business beyond legal obligations, and the consideration of social, economic, and environmental impacts when making business decisions
CSR considerations
- aware and responsible
- integrity and honesty
- commitment = positive reputation + competitive
CSR strategies
- sourcing sustainable resources
- planning to sell environmentally responsible products
- providing supportive conditions of work
- fair employment
