Units1,2andmarketing Flashcards
What’s an entrepreneur
An individual who develops a business idea and takes on the associated risks and responsibilities
Qualities of an entrepreneur
Competitive, creative, confident
Factors of production and meanings
Capital - money invested
Enterprise - the business idea
Land - place they’re working
Labour - the workers
Sectors of industry
Primary secondary tertiary
Who owns controls and finances a sole trader
Sole traders own and control the business, financed by the capital they invest
Advantages of sole trader
Make your own decisions
Profits aren’t shared
No special paperwork
Describe the primary sector and examples
Organisations involved in the extraction of the earths natural resources (farming,fishing)
Disadvantages of sole trader
Long hours
Hard to raise finance
Unlimited liability
Describe tertiary sector and examples
Selling of goods and providing services (bank,hairdressing)
What is the sectors of economy
Public private and third
What is secondary sector + example
Manufacturing raw materials to be turned into finished goods (cars)
Examples of sole trader
Plumber, electrician, hairdresser
Describe third sector + example
Owned and run by individuals with the purpose of helping a group or raising awareness for a cause (charities)
Describe public sector + examples
Owned by taxpayer and run by government (NHS,police)
Describe private sector + examples
Owned and run by private individuals (sole trader, partnerships)
What can customer satisfaction lead to
Customer loyalty
Repeat purchases
Increased reputation
Customer satisfaction can be improved by
- Highly trained employees
- Customer care strategy
- Customer complaints procedure
Pros and cons of bank overdraft
Simple to arrange but not long term
Pros and cons of a grant
Doesn’t need to be repaid but only available once
Who owns, controls and finances a partnership
Owned by between 2 and 20 people, they control it as they make all the decisions and financed by capital they invest
Advantages of partnership
Can raise more capital
Risks and responsibilities are shared
Disadvantages of partnership
,profits are shared
,unlimited liability
Who owns, controls and finances a PLC
Owned by shareholders, controlled by a board of directors and financed through selling shares
Examples of PLC
Baxters Ltd
Advantages of PLC
- raise more capital through selling shares
- shareholders have limited liability
Disadvantages of PLC
- accounts are not private
- more complex and expensive to set up
What’s a shareholder
Group of individuals with an interest in and an influence on an organisation
Examples of shareholders
Management, employees, owners, suppliers
Competing aims of shareholders
Senior management wanting to maximise profits and customers wanting low prices
Internal factors
Employees, finance, and management
Employees internal factor
- quality of production
- skill/ability level
- work rate
- resistance to change
Management internal factor
Quality of decision making
Finance internal factors
Is there capital available for changes to be implemented
What is external factors
PESTEC - Political Economic Social Technological Environmental Competition
External factors - political
New/changing legislation
External factors - economic
Changes to interest rate (may have to pay more)
External factor - social
Trends and fashions (keeping up to date)
External factor - technological
Improving technology may give a business a competitive advantage
External factor - environmental
Impact on environment (floods, hippies)
External factor - competition
Innovative ideas from other companies
SWOT analysis
Strengths, weaknesses, opportunities, threats
What are the two types of market research
Field research and desk research
What is field research and examples
Primary info first hand (surveys, interviews)
What is desk research and examples
Gathering secondary info (newspaper,Internet)
Product lifecycle
Introduction, growth, maturity, decline
Distribution methods
Road, sea, air
What should price depend on
- competitors prices
- time of year
What types of promotion are there
Advertising, sales promotion, public relations
What is sales promotion
Either direct mail or personal selling
What are the 4 P’s
Product, price, promotion and place
What are loyalty cards
Gather info on what we buy, when we buy, how much we spend
What’s E-commerce
Online shopping, can compare and buy 24/7
What 3 ICT things do businesses use
Loyalty cards, E-commerce and social media
What will PR department do
Deal with press and government and take part in customer care
Benefits of branding
- can charge a higher price as product is perceived as high quality
- company is better known so sales increase
- customer loyalty, increased sales
- makes easier to launch new products as brand already exists
