Understanding external influences on business

What is a stakeholder?

A person, group or organisation that has an interest in a business

What is an internal stakeholder?

A stakeholder from within a business

What is an external stakeholder?

A stakeholder from outside of a business

Who are shareholders and owners?

People who influence the business’ aims, objectives and strategic activities

What is a shareholder?

A part owner of a private or public limited company

Who are managers in a business?

Staff responsible for implementing decisions and overseeing work

Who are employees?

Staff who carry out the day-to-day work of the business

Who are customers?

People who buy products or services from the business

Who are suppliers?

Businesses or organisations that provide goods or services to a business

What is a pressure group?

A group of people with a shared interest related to the business

What is the role of the government as a stakeholder?

To collect taxes and encourage job creation

Who makes up the local community as stakeholders?

People, organisations and businesses near the business

What do owners want from a business?

Success and profit

What do managers want from a business?

A good salary and career progression

What do employees want from a business?

Good pay, job satisfaction and security

What do customers want from a business?

Good quality and range of products at reasonable prices

What do suppliers want from a business?

On-time payments and regular orders

What do pressure groups want from a business?

To raise awareness of their cause

What does the government want from a business?

More jobs to increase tax revenue

How are owners affected by business growth?

They may authorise opening new stores

How are managers affected by business growth?

They take on more responsibilities and set new targets

How are employees affected by business growth?

They have increased job security

How might customers benefit from a new store opening?

They will have more choice about where to shop but may stay loyal to existing businesses

How can suppliers benefit from a new store?

They may receive increased orders which could raise their profits

How could the local community benefit from a new store?

It could bring new jobs

Why might pressure groups protest against a new store?

If they feel their cause is negatively affected

Why might the government support the opening of a new store?

It could create jobs and increase tax revenue

Who has the most impact on business activity?

Owners

What role do managers play in business decisions?

They make some recommendations and decisions

How much influence do employees have on business decisions?

They may have a limited amount of influence

How can customers influence business activity?

They can influence others

How can suppliers impact a business?

They can affect it significantly if product changes occur

How can governments influence business activity?

They can pass new laws

What is often required to overcome a conflict in business?

Negotiation and willingness to compromise

What three things are required for e-commerce to take place?

A seller with products online, an online buyer, and a network for trade

What is communication in a business context?

Sending and receiving information to and from others

What digital tools are commonly used in business communication?

Email, mobile phones, mobile apps, websites, social media, web conferencing, cloud services, instant messaging

What has happened to the use of cash for payments in the UK?

It has fallen significantly

What payment method has increased in use in recent years in the UK?

Debit cards

What has led to the introduction of new payment methods?

Advances in payment technology

What are two examples of new payment methods introduced through technology?

Chip and pin, contactless payments

What is the impact of digital communication systems on sales activity?

They help increase and support sales activity

How does ease of contact affect customer trust and purchases?

The easier it is to contact a business, the more likely a customer is to trust it and buy

What are the positive impacts of e-commerce on sales?

Global reach, 24~7 selling, professional image, easy price updates, visible stock levels

What are the negative impacts of e-commerce on sales?

More competition, delivery logistics, customer service challenges, price comparison, stock management

How can social media help a business?

It can run sales campaigns and build customer relationships

Why is it important to make payments easy for customers?

It increases the likelihood of a purchase

What happens when a business invests in digital communication systems?

There are costs at first but long-term savings

How has digital communication changed working patterns?

It allows more employees to work remotely

Why is sending communications electronically beneficial?

It is more cost-effective

How can small businesses benefit from social media?

They can reach a wide audience for minimal cost

What is the benefit of real-time online transactions?

A business receives payment almost immediately

Why must businesses be flexible with technology?

To respond quickly to customers and adapt to change

How can products be made more convenient for customers?

They can be adapted and accessed in flexible formats

How can digital communication help with pricing?

It saves money, which can help keep prices low

What is an advantage of digital services for customers?

They can access services regardless of location

How can businesses use digital tools to connect with customers?

Through newsletters, social media tracking, and online ads

How can e-commerce affect the marketing mix?

It can impact product, price, place, and promotion

What can customers do with digital products?

Download them

How can product information be shared online?

Using video demonstrations

What can customers do with prices online?

Compare them across sellers

How can cost savings from digital tools impact pricing?

They may enable lower prices

What is an advantage of online promotional offers?

Flash sales are easy to implement

What is the purpose of the Consumer Rights Act (2015)?

To protect consumers from unfair and dishonest business practices

What areas does the Consumer Rights Act (2015) cover?

Product or service, returns, repairs and replacement, delivery

What are goods required to be under the law?

Accurately described, fit for purpose, of satisfactory quality

When can a consumer reject a product for a full refund?

Within 30 days of taking ownership

What must a consumer do after 30 days if a product is faulty?

Give the business one opportunity to repair or replace it

Are digital goods included in the right to repair or replacement?

Yes, if they are faulty, unfit for purpose or not as described

When should delivery take place under the Consumer Rights Act?

Within 30 days, unless agreed otherwise

Who is responsible for goods during delivery?

The business, until the goods are with the consumer

What does the Act say about product safety and damage?

Producers are liable for damage caused by poor quality or defective products

What does employment law aim to do?

Protect employees from exploitation

What are the four key areas of employment legislation?

Recruitment, pay, discrimination, health and safety

What must businesses consider when recruiting new staff?

The Equality Act (2010)

Why must businesses follow the Data Protection Act (2018) during recruitment?

Because they collect and use personal data

What does the Employment Rights Act (1996) require?

A written statement of employment details within two months

What must the written statement of employment include?

Job title, place of work, start date, hours, salary

What does the Pensions Act (2008) require for new staff?

They may need to be enrolled into a pension scheme

What does the National Minimum Wage Act (1998) require?

All staff must be paid a minimum hourly rate

What does the Equality Act (2010) make illegal?

Paying people different rates for the same or similar jobs

What characteristics are protected under the Equality Act?

Age, disability, gender reassignment, marital status, pregnancy and maternity, race, religion, sex, sexual orientation

What does the Health and Safety at Work Act (1974) outline?

The responsibilities of employers and employees for workplace safety

What must employers provide under the Health and Safety at Work Act?

Staff training, safety equipment, drinking water, toilets, washing facilities, first aid equipment

What are employees expected to do for workplace safety?

Complete training, use safety equipment and clothing, take responsibility, report risks

What must businesses do regarding government legislation?

Comply with it

What costs do businesses face when complying with legislation?

Time and money

What could happen if a business breaks employment laws?

Legal fees, fines, compensation, damage to reputation, loss of sales and staff

Why might suppliers avoid working with non-compliant businesses?

To avoid being associated with law-breaking or bad publicity

What is one benefit of complying with employment law?

Staff feel confident and know their employer is responsible