Grade 10 Business Studies - Business Environments

Flashcards covering the key concepts related to business environments, including micro, market, and macro environments, as well as various environmental factors and their impact on business operations.

Micro Environment

The internal environment in which a business operates, over which the business has full control.

Vision

The expectations of what the business can realistically achieve in terms of aspirations and purpose.

Mission

The reason why the business exists and its main direction.

Goals

The end results that the business hopes to achieve.

Objectives

The specific defined outcomes that the business will work towards in order to achieve its goals and mission.

Purchasing

Responsible for acquiring the means needed to carry out the activities of the enterprise to make a profit; the buying function.

Human Resources

Manages people in the business - involves recruiting new staff and managing existing staff.

Administration

Deals with the information flows that are needed to run a business (paperwork).

Finance

Makes sure the business has the financial resources needed to run a business.

Public Relations

Relates to building and managing relationships with all stakeholders including customers, suppliers and employees.

Natural Resources

Comes from nature and needs processing; remuneration is rent.

Human Resources

Physical and mental talents and skills of people used to create goods and services; remuneration is wages and salaries.

Capital/Financial Resources

Money, production facilities, buildings, land, etc. that is used to produce goods; remuneration is interest.

Entrepreneurial Resources

People who are prepared to take a risk; remuneration is profit.

Management

Directs human behavior; communicates through management functions; manages plans to reach targets; controls systems and procedures.

Leadership

Influences human behavior; communicates through interaction/behavior/vision/values/charisma; encourages new ideas; inspires staff.

Suppliers

They are individuals, companies or other organizations that provide goods or services to a business. Provides inputs that the business needs in order to produce goods or services.

Competitors

They are other businesses that sell the same or similar products/services

Intermediaries

They bridge the gap between the manufacturer and the consumer. They bring the products and services within reach of the consumer.

Marketing intermediaries

Are wholesalers, retailers, spazas, agents, broker etc.

Financial intermediaries

Are banks and insurers.

Electronic commerce, or e-commerce

Takes place when businesses sell their products using Internet technology, can lead to disintermediation.

Wholesalers

Buy goods in bulk from the manufacturer and store them in warehouses.

Agents

Act as representatives for products, manufacturers and wholesalers and do not take ownership of products. They earn commission on sales.

Brokers

Are sales intermediaries who do not take ownership of the product. Their main purpose is to negotiate markets where there are only a few buyers or sellers. They usually specialise in a particular product, country, province or area.

Buyers

Are the final users of the product/services.

Power of suppliers

Include factories/providers of goods/services that businesses would obtain/buy from in order to operate their business.

Threats of substitutes

Are different products/services that at least partly satisfy the same needs of consumers and can be used to replace one another.

Direct Selling

This is the marketing and selling of products directly to consumers. It does not involve middlemen.

Distribution

This the route that a product follows from the time it was produced until it is sold to the end consumer. The route is called the distribution channel.

Regulators

Establish regulatory bodies that set rules and requirements for the operation of businesses in that industry.

Civil Society

Organized groups within a society can influence the way businesses conducts it. Represent the interests of workers.

Macro Environment

The external environment in which a business operates. A business has no influence or control over this environment.

Political Environment

Factors which have a significant influence on business because they influence people's long-term view of a country's economy.

Economic Environment

Includes all the businesses and government enterprises and organisations involved in the economy. It depends on the economic system of the country.

Social Environment

The structure of society is constantly changing.

Technological Environment

Has shown the fastest changes as new technologies constantly develop. Makes it possible to improve the production process by replacing human labour with electronic and computer equipment.

Legal Environment

Is set to regulate the performance of business and to protect the assets of a country. Parameters (boundaries/rules within which actions should take place) are set in legislation and businesses have to operate within those parameters.

Physical Environment

Includes the availability and development of natural resources of the country-for example wood to make furniture and soil to grow crops.

International Environment

Includes other countries' laws, cultures, economics and politics. Operates in a complex environment, because every country has its own environmental factors such as technology, economy, laws, politics, markets and competition.

International Trade

Companies trade with companies in other countries.

Globalisation

Companies operate in two or more countries while based in one home country.

Institutional Environment

Will be influenced by several institutions which aim at: Creating an environment where help/assistance is made available to all enterprises.