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a level business > UNIT 9 > Flashcards

UNIT 9 Flashcards

(100 cards)

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1
Q

calc for percentage change

A

change in values/ original value X100

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2
Q

what are the two categories of growth

A

organic and external

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3
Q

whats the difference between organic and external growth

A

organic is steady, gradual, low risk growth eg: market penetration
external is sudden and significant growth eg: mergers/ takeovers

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4
Q

whats synergies

A

the interaction of two organisations/ agents to produce a combined effect greater than separate

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5
Q

name and describe the 4 types of EoS

A

purchasing- specialist buyers
technological- specialist capital and labour
managerial- attracts most efficient managers
financial

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6
Q

whats overtrading and what can it do to a business

A

overtrading occurs when a business grows too much, this may lead to
communication issues
loosing control

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7
Q

4 reasons business’ grow

A

inc market share
inc brand recognition
inc market power over customers and suppliers
inc profitability

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8
Q

define retrenchment

A

reduction in costs or spending in response to economic struggle eg: redundancies

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9
Q

3 reasons why business’ retrench

A
  1. they may be out of touch with customers, therefore they need to be innovative
  2. failed merger meaning they need to reduce costs to get back on track
  3. changing markets and customer needs eg: shopping online, free parking
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10
Q

name 3 issues w growth

A

diseconomies of scale
overtrading
Eos impacts cost of production etc

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11
Q

define economies of scope and an adv of this

A

a proportionate saving gained by producing two or more goods when the cost to make is less than producing seperately
reduces costs, inc output

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12
Q

name 2 types of internal diseconomies of scale

A

reduction in productivity
- dec output
- inc unit costs
lack of co ordination
- new staff must be controlled

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13
Q

4 advantages of synergies

A

inc revenue
combined talent
combines technology
dec in costs

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14
Q

how does growth affect HR department?

A

decisions to be made on organisational structure, therefore which staff will stay and which roles duplicated etc

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15
Q

how does growth affect finance department

A

more capital to invest, must live up to shareholders expectations though to increase profits

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16
Q

how does growth affect operations

A

more money available for supplies
outsourcing becomes an option
potential overtrade?
improvement in capital utilsation

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17
Q

how does growth affect marketing

A

marketing mix is used to achieve objectives of new larger company

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18
Q

impact of retrenchment on human resources

A

decisions will have to be made to make staff redundant to cut costs

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19
Q

impact of retrenchment on finance

A

focus on business costs and how to reduce them during period of retrenchment

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20
Q

impact of retrenchment on operations

A

resources will have to be used more carefully to reduce costs
some fixed assets may have to be sold

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21
Q

impact of retrenchment on marketing

A

marketing budget may be cut to reduce costs which may have an impact on sales

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22
Q

types of external growth

A

mergers, takeovers, joint venture

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23
Q

merger

A

two business’ join together

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24
Q

takeover

A

one business acquires another and takes their assets too

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25
joint venture
two business’ come together to work together on product/ service remain separate but share expertise
26
name 4 types of mergers
horizontal, forwards vertical, backwards vertical, conglomerate
27
horizontal merger+ adv and dis
a merger in the same supply chain - share expertise, gain Eos and synergies - leadership clash, less flexibility
28
fowards verticle
taking over a customer eg: retailer - producer can determine how producers and prompted and build relationships w consumers
29
backwards verticle
taking over supplier - allows business to acquire materials for cost price
30
conglomerate
taking over business in new market - spreads risk
31
5 pros of external growth
profitability economies of scale shared expertise instant growth increase market share
32
5 disadvantages of ext growth
- may be communication loss - damages business if cant cope - risk of retrenchment - inc regulation - may be resistant to change
33
whats a franchise
a franchise is where a business allows another to trade under its name, in return for payment
34
whats a franchisor
gives franchisers the right to sell its product and service
35
whats a franchisee
the business that agrees to provide branded product under agreement
36
benefit of opening franchise
already established support for training and equipment access to goods marketing established
37
disadvantage of opening franchise
initial investment is costly decision making royalty payments lack of control
38
benefit for franchisor
regular income have control growth of business
39
disadvantage for franchisor
must provide training and equipment cant control all time risk of ruined brand image
40
innovation is sometimes a result of pressure, what pressure?
PESTLE P- legislation ie carbon emissions E- efficiency and low cost S- trends T- up to date E- competitive adv, match innovation
41
what does innovation potentially lead to?
market leader
42
what are the 4 ways to become innovative
kaizen- continuous improvement R+D- investing to observe trends Intraprenurship- autonomy to work on own Benchmarking- compare to companies
43
whats a weakness of the 4 ways to become innovative
it doesnt guarantee success, therefore risk of wasting resources
44
impact of innovation on each department ( marketing )
marketing- identify needs which drive innovation
45
impact of innovation on each department ( financial )
needs to retain profits to finance innovation
46
how innovation affects each dep ( operations )
operations implement new operations to improve efficiency
47
impact of innovation on dep ( HR )
HR job design must be creative, and include innovative ideas
48
whats disruptive innovation
making expensive products cheap eg: music downloads affect HMV
49
strengths of innovation for a business
increased creative ideas act as self actualisation as employees can be creative awards
50
what are the 3 types of innovation
completely new product improvement of existing product new feature of existing
51
whats IoT
rapidly growing technology that connects physical devices to internet
52
3 types of process innovation
improvement in tools changes in equipment used in manufacturing update in software
53
whats the intellectual property
a way to protect an idea
54
whats a patent
grants exclusive rights to make, use an invention for 20 years requires detailed registration costly ( up to £310 )
55
whats the process of patent
1. patent attorney reccomended 2. prepare detailed documents 3. file 4. substantive examination ( takes years )
56
whats copyright
protects creative rights automatically granted and lasts a lifetime + 70 years
57
whats a trademark
protects brands logos and ensures customers recognition
58
name 3 other types of protecting innovation
contracts and agreements, monitoring and enforcement licensing agreements
59
define globalisation
the process of becoming interconnected as a result of massively increased trade and cultural exchange
60
name 6 reaona for globalisation
reduced cost of transport reduced cost of communication political change dec of trade barriers inc significance of global companies migration structural change
61
why has the reduction of international trade barriers increased globalisation
to get closer to free trade and to promote economic growth
62
political change
meetings are now international, discussing open trade
63
inc of significance of global companies
amount of deliveries reduced by containerisation ( opened 1970 ) which gains companies EOS
64
communication
ONLINE COMMUNICATION
65
migration
labour increases, improved economy as well as bringing culturally unique skills
66
name the 4 reasons for targetting, operating, trading with international countries
exporting, licensing, alliances and foreign direct investment
67
whats exporting
sending products abroard if a business has saturated their market, they may find alternatives abroard
68
2 advantages of exporting
increased eos as unit price will dec by selling more of the same product increased market share
69
two weakness’ of exporting
- transport costs high - cultural differences
70
whats licensing
business can get foreign firms to produce their products under licence the licence is where a business grants the right for another to use international goods under their name
71
3 advantages of licensing
- revenue generation - royalties - shared risk and market expansion
72
3 disadvantages of licensing
- loss of control - dependancy on licensee - risk of intellectual property theft
73
whats an alliance
a union between business formed for mutual benefit, allowing each-other to benefit from other markets
74
3 advantages of alliances
- synergies - cheap advertising - shared customers
75
3 weakness’ of alliances
shared profit could become competitor clash, leading to negative PR
76
whats foreign direct investment
business outside of marketing trade blocs invest in a business inside trade bloc to avoid tarrifs
77
3 advantages of foreign direct investment
GDP growth in country income in country skills in country
78
2 weakness’ of foreign direct investment
risk of political changes higher costs
79
name 3 things that influence attractiveness of international market
larger populations increased middle class low competition
80
define offshoring
when a business relocates some of its processes to another country to reduce costs eg: manufacturing
81
advantages of offshoring
lower minimum wage trade blocs staff expertise
82
whats reshoring
bringing those processes back, less labour intensive and more capital. this is due to an adv in technology and benefits get erroded
83
name 5 influences of buying and selling abroard
- cultural differences - colours unacceptable eg: black in japan - war and income of locals - access to resources
84
whats local responsiveness
the extent to which a company customises product to suit other countries cost reduction eg: standardisation and economies of scale
85
whats digital technology
digital devices and systems that help create and manage data
86
name 4 pressures to adopt digital technology
automation e- commerce big data data mining
87
whats e- commerce
buying, selling online. this helps small business’ compete
88
two adv of e-commerce
start up costs low prices are transparent and comparable
89
two weakness of e- commerce
delivery costs not suitable for all ie: trainers try on
90
whats big data
large sets of data that can be analysed using data mining to find patterns and trends
91
whats data mining
finds patterns within big data to then use in decision making process
92
two adv of data mining
helps understand customers needs accurately forecasts sales
93
two weakness of data mining
costly correlation doesnt always mean LT
94
whats a real life example of data mining
Dunnhumby analysed customer data and finds needs
95
name 5 things digital technology has helped business’ with
- dec time to market product - inc productivity of employees - acquire new tech skills quickly - improve data handling - gain competitive advantage
96
how does digital technology affect HRM
- employee monitoring - performance reviews - better communication for recruitment
97
how does digital technology affect finance
- advanced analytics for finance to speed up decision making - data visualisation tools to improve communication
98
how does digital technology affect production
- high levels of productivity to improve profits - replaces hazardous jobs
99
how does digital technology affect marketing
marketing campaigns can now become more personal to increase sales eg: facebook
100
features of diseconomies of scale
slow communication, unmotivated workers and difficulty controlling and co ordinating

a level business (10 decks)

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