unit 1 gcse business Flashcards
what is a need?
it is a basic you need to survive like food water, shelter warmth and basic clothing.
What is a want?
it is any other items that are luxury. Wants are infinite
what is primary research?
research that does not already exist and you collect yourself.
Give 2 examples of primary research?
questionnaires
surveys
observations
consumer panels
What is secondary research?
Information that already exists or has been collected by a third party
Give 2 examples of secondary research?
Sales figures
specialist magazines
competitor information
trade magazines
What is a market map?
a grid which shows 2 components for example quality and price.
What is a gap in the market?
An area of the market that is not currently covered by existing products or companies. identified with a market map.
What is a niche market product?
a product that is aimed at a small section of the market or is specialist.
give an example of a niche product.
bespoke wedding dresses, Morgan cars.
What is a mass market product?
a product that is aimed at the whole market.
Give an example of a mass market product
dairy milk Walkers Crisps Ford Focus Coke Kingsmill bread
What is a SWOT?
A way of identifying a companies strengths weaknesses and external opportunities and threats.
What does it mean to add value?
it is a way of being able to charge more for the final product than for its individual components
What is a Franchise?
Where a company sells the right to use the company brand and products in exchange for a fee and a percentage of the profit.
What is a franchisee?
the person that buys a franchise
What is a franchisor?
the person that sells a franchise
Name 3 types of ownership that could be used for a new business.
soletrader
partnership
franchise
What factors should be considered when considering location?
Communication parking Access to workers Access to customers Location of raw materials location of competitors
What is a good?
a physical product you can touch and see
What is a service?
a non physical item, for example a cleaning service or beautician
What is a durable good?
a good that can be used again and again e.g. a washing machine
What is a perishable good?
a good that has a shelf life and will go off. e.g bread
Name three qualities of an entrepreneur.
risk taking, hard working,motivated, innovative, creative, problem solver,
Name three motivations of a entrepreneur?
money, working for themselves, ability to chose own working hours, love of work,
What is the Marketing Mix?
Product Price Place Promotion. These need to be correct before a product will be successful.
What is a business plan?
A document a person completes when they intend to start or grow a business. Banks want to see a business plan before lending money.
What is qualititive research?
Where the information collected is numerical
What is quantitative research?
Where the information collected is about opinion
What does limited liability mean?
That the owner can only loos the money invested in the company not anything more.
what does unlimited liability mean?
That the owner can be held resposible for the debts of the company and could loose personal possessions.
What type of company can be unlimited liability?
sole trader or partnership.
What type of company would be limited liability?
LTD or PLC
What is the business cycle?
It is a cycle that the economy goes through, from recession to Boom
What is competitive advantage?
an advantage that a firm has over another firm, eg better product or lower price
What does innovation mean?
original or new ideas to enter the market
what is deliberate creativity?
using a range of technique to encourage people to be creative in their thinking.
what is a cash flow forecast?
it is a finance document that estimates the inflows and outflows of money in the company. Banks like to see these before they lend money.
On a cash flow what is an inflow?
Money coming into the company
On a cash flow what is a outflow?
Money going out of the company
What is a long term source of finance?
It is money borrowed for a term of 5 years or more
What is a short term source of finance?
It is money borrowed for less than a year.
What is an internal source of finance?
It is money that is available within the company
What is an external source of finance?
it is money that is obtained from outside the company
What is a stake holder?
Any person or group that has an interest in the business
Give 3 examples of stakeholders.
employees, managers, owners, customers, suppliers, pressure groups, local residents.
Give 2 examples of internal sources of finance.
retained profit, owners money
Give 2 examples of external sources of finance.
loan, selling shares, overdraft, venuture capitalist, trade credit
What is a boom?
a period of high output and growth in the economy
What is a recession?
a period of low output with little or no growth in the economy
What does the term interest rates mean?
the amount charged as a percentage of money borrowed.
If the pound is weak against the euro what does it mean for UK small businesses?
It means products they buy from Europe become more expensive.
If the pound is strong against the euro what does it mean for UK small businesses?
it means they can buy products from Europe more cheaply
What does the exchange rate mean?
it is the value of one currency against another.
If interest rates go up what does this mean for small businesses?
it means that they will have to pay more for money borrowed, but also customers may have less disposable income.
If interest rates go down what does it mean for small businesses?
It means they can borrow money more cheaply and customers may have more disposable income
if the pound is strong against the euro what does it mean for consumers?
For people living in the UK it becomes cheaper to buy products from abroad.
What is demand?
the consumers desire and willingness to pay for a product
What is Supply?
the total amount of a good that a producer is willing and able to supply on the market at a given price
What would happen to demand of an iphone if supply was low?
The price would increase
What would happen to the price of a coat if the demand for it was very low?
The price would decrease
