IB Business 1.1 & 1.2

Primary sector

firms engaged in extracting natural resources and raw materials fall under this sector

Secondary sector

firms that manufacture and process products

Tertiary sector

firms that provide services to consumers

Quaternary sector

firms that are focused on information technology

entrepreneur

someone who takes the risk of starting a new venture

intrapreneur

someone who takes direct responsibility for a project within a company

Contents of a Business Plan

executive summary- an overview of the new business

description of the business opportunity

marketing and sales strategy

the management team and personnel

operations- premises to be used, IT systems

financial forecasts

Unincorporated Organizations

sole-trader, partnership

Incorporated Organizations

private limited, public limited, cooperative

Non-For-Profit Organizations

charities, NGO’s, sports teams, governmental organizations

Sole Trader

A business in which one person provides permanent finance and, in return, has full control and keeps all profits.

Limited Liability

The only liability a shareholder has if the company fails is the amount invested in the company, not their total wealth.

Private Limited Companies

A medium-sized business that is owned by shareholders who are often from the same family. This company can’t sell shares to the public.

Public Limited Companies

A large company with the right to sell shares to the general public

Social Enterprises

A business with mainly social objectives that reinvest most of its profits into benefitting society. They aren’t charities, they can keep some of the profit they made.

Cooperatives

A group of people acting together to meet the common needs of its members. These are not about making big profits for shareholders, but about creating value for customers and secure employment for workers.

Microfinance Institutions

The provision of very small loans by specialist finance businesses, usually not traditional commercial banks. Their approach to providing small capital sums to entrepreneurs is now a very important source of finance in developing countries.

Public- Private Partnership (PPP)

Involvement of the private sector in public sector projects aimed at benefiting the public.

Non-Governmental Organisations (NGOs)

A non-for-profit group, independent from government which is organized to tackle issues that support the public good.

main types of PPPs

government-funded (privately managed, funded by the government)

private-sector-funded (government managed, PFI [private finance initiative ] )

government-directed but with private-sector finance and management (private-sector funding/management in public projects)