Business Studies - Preliminary Summary Notes (The Ponds High School)

Vocabulary-style flashcards covering key concepts from the lecture notes on Nature of Business, SMEs, management, planning, marketing, finance, HR, ethics, and change management.

Nature of a Business

The organised effort to produce and sell goods/services to satisfy needs and wants for profit.

Profit

The money left after expenses are subtracted from revenue; revenue > expenses.

Revenue

Income generated from selling goods or services.

Expenses

Costs incurred to run the business and produce/sell goods or services.

Employment

Provision of work in exchange for income; reduces unemployment and supports the economy.

Income

Money received from work or investments; includes wages, salaries and dividends.

Shareholder

Owner of shares in a company; entitled to dividends and potential capital gains.

Choice

Consumer freedom to select goods/services with different features, prices and quality.

Innovation

Development of new ideas or products; often through R&D; improvement of existing goods.

Invention

Something completely new; a novel product, process or method.

Entrepreneur

Person who starts and runs their own business.

Wealth

Business activity increases personal wealth and economic growth.

Quality of Life

Material standard of living and range of choices as a result of wealth and income.

SME (Small to Medium Enterprise)

Business with fewer than 200 employees; typically smaller scale operations.

Incorporated

A business that is a separate legal entity from its owners.

Unincorporated

A business without a separate legal entity from its owner(s); often with unlimited liability.

Sole Trader

Owned/operated by one person; unlimited liability; name registered with ASIC.

Partnership

Owned/operated by 2–20 people; unincorporated; shared workload and profits; potential unlimited liability.

Private Company

Incorporated; 2–50 shareholders; not listed on stock exchange; limited liability; private.

Public Company

Incorporated; listed on ASX; many shareholders; must publish annual reports; Ltd in name.

Government Enterprise

Public sector business (GBE); may be privatized; examples include Australia Post and Sydney Water.

External Influences

Factors outside the business (economic, political, legal, technological, social, etc.) that affect decisions.

Internal Influences

Factors within the business (products, location, resources, management, culture) that shape operations.

Stakeholders

People or groups with an interest in the business; internal (owners, managers, employees) and external (customers, society, environment, suppliers).

Life Cycle Stages

Stages of a business: Establishment, Growth, Maturity, Post-maturity, Renewal/Decline.

Vertical Integration

Merging with a supplier or distributor at different levels of the supply chain.

Horizontal Integration

Merging with or acquiring a competitor producing similar products.

Diversification

Expansion into unrelated or new product lines or markets.

Operations

Transforming inputs into outputs; production processes for goods or services.

Quality Management

Approaches to ensure quality: quality control, quality assurance, total quality management (TQM).

Marketing Mix (4 Ps)

Product, Price, Promotion, Place; extended with People, Processes, Physical evidence for services.

SME Success Keys

Entrepreneurial ability, access to information, flexibility, focus on niche, reputation.

Cash Flow

Timing and amount of cash inflows and outflows; tracked via cash flow statements and forecasts.

Balance Sheet

Snapshot of assets, liabilities and owner’s equity at a point in time (A = L + OE).

Income Statement

Revenue minus expenses over a period; shows net profit or loss.

Equity Finance

Funds provided by the owner(s); not repayable unless owner leaves; potential for high returns.

Debt Finance

Borrowed funds from external sources; involves interest and repayment obligations.

Ethics

Standards that define acceptable behaviour; moral principles guiding business conduct.

Corporate Social Responsibility

Open accountability to stakeholders; balancing economic, social and environmental goals.

Change Management

Approaches to handle internal/external change; proactive vs reactive, including communication and training.

SWOT Analysis

Strengths, Weaknesses, Opportunities, Threats; situational analysis framework.

Feasibility Study

Assessment of market, operations, financial viability and management capability.

Franchise

Franchisor licenses a business name and system to a franchisee under an agreement.

Market Segmentation

Dividing a market into groups (demographic, geographic, psychographic, behavioural).

Break-even

Sales level at which total revenue equals total costs; profit above break-even.

E-business / E-commerce

Using the internet to find information, communicate, trade, and train; online business processes.

Triple Bottom Line

Economic, environmental and social performance measures used to evaluate success.

Globalisation

Expansion of business activity across borders; increased international competition.