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A good budget must be:
Be consistent with the aims of the business.
Be based on the opinions of as many people as possible.
Not decided by someone who has done little research.
Set challenging but realistic targets.
Specific, manageable, achievable, realistic and time-based.
Be monitored at regular intervals.…

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Cash outflow is all money that leaves the business. Costs are the outgoings that are directly involved with the running of the
Credit purchases are costs but not outflows as the money has not yet left the business.
There are many reasons for cash outflows but only one reason…

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This is a good indication of the satisfaction at work.

An organisational structure is the formal way in which the management of a business is organised.
To organise activities
Identifies who does what
Shows where each employee fits into the business
Usually divided into the functions of a business:

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An entrepreneurial structure is found only in small businesses, in very competitive markets, where quick decision-making is important
to maintain and increase market share
Quick decision making is possible
Suits a small business where job roles may be informal and each person takes on a variety of tasks.
Becomes ineffective…

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Formal channels of communication are channels that are established by senior management. Informal channels are where
information is passed outside of the formal channels e.g. gossip.

Vertical communication occurs when information is passed up and down a chain of command. Downward communication is known as
top-down and upward communication is…

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Market research
Feedback forms
Loyalty programmes and cards
Suggestion forms/boxes
Mystery shoppers are often used to monitor customer service.

Factors to consider when a business is choosing a supplier:
Price (value for money)
Payment terms

Suppliers will help a business:
Allow consistent quality
Better customer service…

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o Social networking sites.
EDI can be used to automatically reorder stock.
Break down of communication links could be disastrous for the business.

If the wrong people are recruited, the following problems may occur:
Low motivation
Poor productivity
Administration costs of finding new staff if they leave
Having to spend…

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Employers will know more about the internal candidates' abilities.
Quicker and less expensive
Limits the number of applicants
External applicants might be more qualified with better ideas
Another vacancy is created

External recruitment is where employees from the outside are hired. Used where internal recruitment is inappropriate because
employees may…

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Salaries are payments expressed in annual terms and normally paid monthly.
Makes financial planning clearer.
Overtime not necessarily paid.

Overtime is hours worked that are not specific to the contract.
Can meet the demands of larger customer demand.
Cover sick staff
Difficult to manage
Costs more

Commission is the per…

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Abraham Maslow believed that everyone has the same needs that can be organised into a hierarchy. He identified that people will
strive to reach the next level.
1. Self actualisation
2. Self esteem
3. Social needs
4. Security needs
5. Physiological needs

Frederick Herzberg identified that having certain things wouldn't…


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