Unit1

Question 1

What is a good

Answer 1

Something that is tangible e.g. Mobile phone

Question 2

What is a service

Answer 2

Something that is intangible e.g. Hair cut

Question 3

What is a customer

Answer 3

It is someone who buys/ purchases the good or service

Question 4

Consumer

Answer 4

Someone who uses the good / service. They don’t have to have paid

Question 5

What is an entrepreneur

Answer 5

A person willing to take a risk and starts and runs there own business

Question 6

What are the 3 industrial sectors

Answer 6

Primary, secondary, tertiary

Question 7

What happens in the primary sector

Answer 7

You extract raw materials from the land or sea

Question 8

What happens in the secondary industry

Answer 8

You turn raw materials into products

Question 9

What happens in the tertiary sector

Answer 9

The selling and distributing of the products

Question 10

What is Interdependency

Answer 10

Buisness’s in a chain of production rely on one another

Question 11

What is social enterprise?

Answer 11

A business that achieves a reward for society. They make money in a socially responsible way. They reinvest money into or business or community

Question 12

What is traditional enterprise

Answer 12

To make money and satisfy shareholders enterprise

Question 13

What is a aim and a objective

Answer 13

A aim is the overall goal to achieve

A objective are the steps taken to achieve the aim

Question 14

Why do people start social enterprise business?

Answer 14

• they want to change the world

- they,re not just in it for the money

Question 15

Start up

Answer 15

A new business operating in the market place for the first time

Question 16

What is a niche market

Answer 16

A buisness that targets a small specific segment of the market

Question 17

What is a mass market

Answer 17

Where buisnesses target there product at the entire market and appeal to all customers

Question 18

Adv and disadvantage for mass market

Answer 18

ADV
-Can be produced for a really low cost
-High sales revenue as product is standardised and appeals to people
DISADV
-Lots of competition (perhaps even global)
-Quality may suffer as production happens in larger volume
-Hard to understand customer needs especially if said globally

Question 19

ADV AND DISADV FOR NICHE MARKET

Answer 19

ADV
-Less competition especially from larger buisnesses
-Specialised products and often high quality
-Products usually have a unique selling point
DISADV
-Smaller market to sell therefore lower sales
-Can charge a higher price

Question 20

What’s a mission statement

Answer 20

It’s what a company wants to achieve and how it wants to act. It sets out the vision and values of a buisness

Question 21

Aims for a new small startup business

Answer 21

• to survive the first year
• to break even
• to achieve a certain level of sales
• to make profit
• to achieve/ grow market shares

Question 22

Judging success

Answer 22

• profit
• how big the buisness is
• standard of service
• share price
• number of employees
• sales

Question 23

What is a market share

Answer 23

The amount of sales a business gets out of the total sales in a industry

Equation - (company sales/total industry sales) x 100

Question 24

What is a creditor

Answer 24

People or organisations to whom the business owns money

Question 25

What is a franchise?

Answer 25

It is where a business sells the rights to another buisness to use their name, product or process Franchisee- he rents out the buisness Franchisor- the person who owns the original business

Question 26

Adv/ Disadv of a franchisor

Answer 26

Adv - The buisness grows - you get regular loyalty payments - you keep control Disadv - reputation is reliant on others - you could have received all profit if you set up all the stores

Question 27

Adv/disadv of a franchisee

Answer 27

Adv -you can sell established products using successful brand image -easy to start-up -help and training available Disadv -No flexibility- must follow franchise model -must pay a percentage of profits to the franchisor (royalty)

Question 28

What is a buisness plan

Answer 28

A written report showing what the business plans to do and what it needs to do to achieve its aims and objective.

Question 29

Why do you need a business plan

Answer 29

- to see if a idea is feasible (going to work) - to get the best possible chance of success - to get funding - to attract investors

Question 30

What are the main factors affecting location

Answer 30

- cost of site - skills of local people - labour costs - competition - transport links

Question 31

What is a sole trader and adv and Disadv

Answer 31

Sole trader- a business that is owned and run by a single individual Adv: - you can make all the decisions - keep all profit Disadv: - unlimited liability - No employees

Question 32

What is a private limited company

Answer 32

A small to medium sized buisness that is usually owned by its founders

Question 33

What is unlimited liability

Answer 33

Buisness owners are responsible for all depts of a business. May have to sell own possessions to pay creditors

Question 34

What are partners

Answer 34

Partners are the joint owners of a buisness. The law says a partnership can have between 2-20 partners.

Question 35

Rules of partnerships

Answer 35

How profit should be shared % capital each person puts in Votes (each partner has) Rules for taking on new partners

Question 36

Adv and Disadv for partnerships

Answer 36

``` Adv: - sickness covered - risk is shared - wider services to offer - partners raise capital together Disadv: - conflicts may arise - deed of partnership not compulsory - decision time might are along time ```

Question 37

Limited company

Answer 37

You have a limited liability. You can only loose the amount of capital you invest

Question 38

LTD- | PLC-

Answer 38

- private limited company | - public limited company

Question 39

LTD Adv and Disadv

Answer 39

- limited liability - not all personal finance therefore risk is spread - Acess to finance is easier

Question 40

What is a stake holder

Answer 40

Any individuals or groups who rare affected by a buisness actions