business unit 1

Primary Sector: Businesses involved in extracting natural resources (e.g., farming, fishing, mining).
Secondary Sector: Businesses that manufacture goods or construct infrastructure (e.g., car manufacturing, construction).
Tertiary Sector: Businesses that provide services (e.g., retail stores, healthcare, education).

Private Sector: Businesses owned by individuals or groups for profit (e.g., Apple, Tesco).
Public Sector: Organizations funded and operated by the government to provide services (e.g., NHS, public schools).
Third Sector: Non-profit organizations focused on social or environmental goals (e.g., Oxfam, RSPCA).

Sole Trader: Single owner, simple to set up, full control, unlimited liability.
Partnership: Owned by two or more people, shared responsibility, unlimited liability.
Private Limited Company (Ltd): Shares owned privately, limited liability, more complex setup.
Public Limited Company (PLC): Shares traded publicly, limited liability, significant regulation.
Community Interest Company (CIC): Combines profit-making with social goals, reinvests profits.
Franchise: A business model where individuals operate under an established brand (e.g., McDonald’s).

Control: Sole traders have full control; partnerships and companies share control differently.
Liability: Sole traders and partnerships have unlimited liability; companies have limited liability.
Taxation: Sole traders and partnerships pay income tax; companies pay corporation tax.
Finance: Larger businesses often require significant capital, influencing ownership type.
Growth Potential: PLCs can raise large amounts of capital via public investment.

Profit: Generating surplus revenue after costs.
Growth: Expanding operations, which can be internal (e.g., opening new stores) or external (e.g., mergers).
Survival: Ensuring the business continues to operate, especially during challenging periods.
Customer Satisfaction: Providing quality products/services to build loyalty.
Reputation: Building a positive brand image through ethical practices and quality.
Sustainability: Reducing environmental impact while maintaining profitability.

Marketing: Running campaigns, market research, managing brand identity.
Human Resources (HR): Recruiting, training, managing employee relations.
Customer Service: Handling complaints, providing after-sales support.
Operations Management: Overseeing production processes, ensuring efficiency.
Finance: Managing budgets, monitoring cash flow, preparing financial reports.
Purchasing: Sourcing materials and negotiating with suppliers.

Example: A marketing campaign increases demand, requiring operations to boost production and HR to hire additional staff.
Poor customer service can damage reputation, reducing sales and impacting finance.

Hierarchical Structure: Clear chain of command, but slower decision-making.
Flat Structure: Fewer management levels, faster communication, but managers may be overstretched.
Matrix Structure: Combines functional and project-based teams, promoting collaboration but potentially causing confusion.

Costs: Expenses incurred by the business (e.g., rent, wages, raw materials).
Revenue: Income from sales of goods or services.
Profit/Loss: Profit occurs when revenue exceeds costs; loss occurs when costs exceed revenue.
Break-even: The point where total revenue equals total costs, neither profit nor loss.

Stakeholders: Individuals or groups affected by the business, including:
- Owners: Seek profit and business growth.
- Employees: Want job security, fair wages, and good working conditions.
- Customers: Expect quality products/services at fair prices.
- Suppliers: Rely on consistent orders and timely payments.
- Local Community: Concerned about environmental impact and job creation.
- Government: Interested in tax revenues and compliance with laws.
Stakeholder Conflicts:
- Owners may prioritize profit, while employees seek higher wages.
- Local communities may oppose expansion due to environmental concerns.

PESTEL Analysis: Evaluates external factors affecting a business:
- Political: Government policies, trade regulations.
- Economic: Inflation, unemployment, economic growth.
- Social: Changing demographics, cultural trends.
- Technological: Innovations, automation.
- Environmental: Sustainability, climate change.
- Legal: Employment laws, health and safety regulations.
Corporate Social Responsibility (CSR): Businesses adopting ethical practices to benefit society and the environment.