business paper 1

what is the purpose of business activity

spotting an opportunity, develop an idea for a business, satisfy customers needs

characteristics of an entrepreneur

risk-taking, determined, creativity, confidence

risks of starting a business

bankruptcy, strained relations, strained health

rewards of starting a business

self-satisfaction, independence

what is the purpose of business planning

reduces risk, helps a business succeed

role of a business plan

identifying markets, help obtain finance, identify resources, achieve business aims/ objectives

types of business ownership

sole-trader, partnership, private/ public limited companies

what can be the aims or objectives of a business

profit, survival growth, provide a service, market share

external stakeholders

government, customers, suppliers, community

internal stakeholders

employees and owners

ways of organic growth

developing new products, gaining new customers, increasing market share

ways of inorganic growth

merges, takeover

advantages of horizontal growth

less competition, more market share, higher profit margins

role of marketing

identifying customers, informing customers, increasing sales

purpose of market research

to identify and understand customer’s needs

primary research methods

questionnaires, focus groups, trialling, interviews

secondary research methods

newspaper, magazines, census, internal data, websites

how to do “segmentation”

age, gender, locations, lifestyle, income

what are the 4 Ps

price, place, promotion, product

what helps develop a product

design, invention, innovation

product life cycle

introduction, growth, maturity and decline

pricing methods

price-skimming, cost-plus, competitive, promotional, penetration

types of point of sale promotion

competitions, free samples, loss leaders, price reductions

ways to advertise/ promote

social media, websites, tv, newspaper, radio

what is the purpose of HR in a business

co-ordinatates hiring/ interviews

what organisational structures are there

tall and flat

span of control

number of people a manager is responsible for

chain of command

a link in authority to those at the top to those at the bottom

delegation

when a manager gives responsibility to someone else

subordinates

workers that a manager is responsible for

authority

the power that a person has to give instructions to someone else

why do businesses have different organisational structures

effective communication, different job roles, various ways of working

ways of working

full-time, part-time, flexible working, temporary work, work from home, working whilst mobile, self-employed

ways of communicating (in business)

text, e-mail, letter, phone, meeting,

why do business recruit

to replace employees who leave, skill gap, business growth

recruitment methods

internal/ external recruitment, job description, person specification

methods of selection

cv, interviews, application form, tests, group activities, references

methods of motivation (financial)

bonuses, fringe benefits, profit sharing

methods of motivation (non-financial)

praise, award schemes, working environment

importance of employee motivation

improved performance, employee retention

importance of employee retention

worker already knows company/customer, saves time and money on recruitment

3 training methods

on- the- job, off the job and induction

why do businesses train their workers

improve productivity, skill shortage, customer service, motivation/ retention

types of staff development

apprenticeships, vocational/academic qualifications

impact of current legislation

discrimination, contract of employment, holidays, hrs of work