business

Business Aims- Where the business wants to go in the future, it's goals. It is a statement of purpose. (e.g we want to grow the business into Europe) . Business Objectives-The stated, measurable targets, how to achieve business aims. (e.g we want to achieve sales of £10 million in European markets in 2011) Changing Objectives A business may change it's objectives as; it may achieve an objective, the competitive environment might change, technology might change product designs.Example of achieving an objective:Surivival in the first year may lead to an objective of increasing profit in the second year.Example of competive environment change:A competitor might launch a new product. Examle of technology changing an objective:New technology might lead to product design changes, so sales and production targets might need to change.Stakeholder A stakeholder is an individual or organisation that is effected by the activities of a business. They may have direct or indirect interest in the business and may be in contact daily or occasionally.Sets out how a business is going to achieve it's aims and objectives. Extremely useful for a new business, as it can show potential investors how their money is going to be spent A business plan will contain the following elements: Statement of aims and objectives, description of the market the business is selling to, main competitors and how they will respond to new ones. Production, sales forecasts, needed equipment, distribution plan. .

Sole Trader A business that is owned by one person, may have more than one employees. It is the most common form of ownership in the UK. Partnership A business where there are two or more owners, most are between two and twenty members. But there are some examples with hundreds of members such as John Lewis. Deed of Partnership How partners are set up in the partnership. It contains; amount of capital each partner should provide, how profits/losses get divided, amout of votes a partner has, rules on taking on new partners, how a partnership is ended or how a member leaves. Capital Starting cash/funds Private Limited Company (LTD) A business that is owned by it's shareholders, is run by directors and has limited liability. Shares can only be sold to friends and family or nominated individuals. Public Limited Company (PLC) A business that follows the same principals as a Private Limited Company, but floats the business on the stock exchange meaning that anyone can buy shares. Limited liability Means that investors can only lose the money they invested, which encourages people to finance the company and maybe even set up a business like this as they will only lose what they put in. Unlimited liability This is when debts of the business are also picked up by the owner of the business, so if the business claims bankruptcy items/belongings could be claimed from the owner to repay the debt. Franchise Where a business sells the right to the businesses name, so someone can set up a business using the branding

Product-The product/service that the customer obtains Place-How the product is distributed to the customer.Price-How much the customer pays for the product.Promotion-How the customer is found and persuaded to buy the productOwner's funds/capitalFinance provided by the owners, no interest but the money could be lost if the business goes into bankruptcy. External Finance Finance from outside the organisation.OverdraftA means of taking more money from a bank account than is in it, usually with charged interest. These are cheap in the short term but quite expensive in the long-term.Bank Loan A source of finance provided by a bank, interest has to be paid and a business plan may be needed.MortgageA long-term source of finance which is usually secured on property. Can be for 25 or 30 years.Government Grant. Money given to a firm to help it operate and expand. This does not have to be paid back.Price-The amount a customer has to pay for a good or service.Sales Revenue/TurnoverThe total number of sales generated by a business (e.g quantity = Sold x Selling Price)Fixed CostsCosts which do not change as output changes. (e.g rent, rates such as lighting or heating)Variable Costs-Costs that change as output changes (e.g materials and wages.Cash flow statement-A document which details inflows and outflows of cash in a business. Used to identify positive/negative cash flow where an overdraft might be needed.

Recruitment-The process of obtaining the correct person for a job. Will involve advertising a vacancy, drawing up a job description, personal specification and short list.Selection-The process of deciding who the right candidate is for a job. (e.g interviews,tests)Internal Recruitment Obtaining staff from inside the business through; notice boards, promotion or personal recommendation.External Recruitment-Obtaining staff from outside the organisation through; job centres, employment agencies or the internet. Operations Management The transformation or raw materials into products.Added ValueThe difference between the value paid for production and the selling price.Job ProductionProducing items that meet specific customer requirements. Usually one off, unique items such as wedding dresses or buildings.Batch ProductionA group of items moving through the production process together in stages. (e.g making loaves of bread in a bakery)

marketinresearch enables a firm to find out about its market,customers and competitiors. secandary research is using existing research eg internet. secandary data adv:time effective sometimes larger scale info is gathered. promotion:limited vudget promotions such as local newspapaer,advertising,direct mail,personal selling,website. primary research- is gathering new infomation e.g.quetionaires. primary data adv: tailored reseach questions specifically cheap can speak to consumers face to face e.g. focus group/customer supplier feedback. product :what products a small business is likely to offer- somtimes unique to large business to compete. marketig mix: the four major variables of marketing: price,place,product,promotion. price: what a business concider when setting a price: cost competition location image .low price isnt always the answer.place: methods of distribution howgoods are transfared from manufactureres to customes. place: prouducer-retailer-customer   producer-wholesaler-retailer-customer.

source of finance-  bank loan- adv:advice/instalments disad:interest  family and friends- adv: flexible payments disad:conflict overdraft : adv:can regularly use it disad:high charges/internet. mortage-adv:instalements/spread cost dis:interest. trade credit- adv:finance period (buy now..pay later) dis:extra debt. government gant- adv:free dis:need qualifications for the grant.  calculation - sales revenue- selling price times units sold Total costs-variable costs times fixed cost proft- sales revenue takeaway totoal costs. cash flow- a prediction of a business inflows and outflows,showing the closing balance.   

monetary motivation- wages/salery/bonus non monetay motivation - responcilbitity/promotion/fringe benefits (e.g.company care,healthcare) motivated care- ouput/profit increase/ reputation/less staff leave. protecting staff- minimum age, equal pay,health and safety.

job production- making one off specialised products for each customer.adv:meet customer requirement/charge high price. Dis:slow to make/labour costs/ material cost high. batch production- group of identical items that pass through different stages of the production process. Adv:lower unit costs/make more of the same item. Dis:lose more specilisation. changes in technology- computers/printers Adv:lower unit cost/better communicationd/quicker/flexible. Dis:cost/training/demotivation/breakages. operationlly efficent- keeping cost low but maintaining a good standard. ways to be more operationally efficent-  efficently machinary, motivated staff,minimum wage,effective management.  adv:can change lower prices process is speeded up. quality assurance - checking, product/services. consumer protection: goods should be fit for purpose. customers protected by the law. customer service: before,during, after. ICT- ecommerce adv and dis to customers 24/7 avaliability/must have internet access. adv and dis to business reach global customers/must be maintained and updated regularly.

reasons for growth: increase sales,increase market share,take advanrage of economics of scale, reputation increase. reasons against growth:lose control,may lose a perosnal service with customers,Risk/culture clash increased workload. methods for expansion- organic growth:expansion within the business. incorganic growth:expansion by mergin with another business. floatation- where a Ltd company becoms a PLC. incorganic growth-horizontal integration (same markets-EE) vertical intergration (manufactorer and supplier) pepsi brought kfc (takeover)

why do people work? money,to make new friends,job security, sense of achievement,sense of identity,satisfy ambition,alleviate boredom. monetary rewards- increase in pay,bonus schemes,staff disocunts, shares in the company. non-mentary rewards- comapny car,free health care,on-site creche. other motivation- good workin conditions,pleasent surrourdings give the impressions that the employer cares, good communcation- so workers know whats going on,job enrichment- gives workers more responcibility, job enlargement- gives workers more tasks of the same skill level. it may require training and rewards with higher pay, job rotatiom, where workers change jobs on a regular baisi.This requires more training but eleviates boredom. legal responcibility- such asd insuranc,all businesses are required to have insurance,in particular employee liability insuranc. this protects the employeer in case an employee injures themselves at work.

job production-occurs when a business is involed in prodcuing one-off designs. each output range will thus be different e.g.firms might manufacture oil ris for the energy industry.each rig will be designed to suit the induvisual requirement of the customer. Batch production- good are produced in batched (specific amounts) this might allow for the slight difference to be made in the ouput of each different batch.e.g. bread.  job production adv: altered for the specific customer so can change higher prices. dis:is expensive process as it is labour intensive (uses more workers compared to machines). batch production adv:faster then job production,staff can focus on one task of the production process dis: if a problem occurs with one batch it may delay another creatin " work in progress"  main advantage of using technology; it is cheap, once its purchased, very little expense is required to keepy it going.Faster, computer scan often do multiple taks that a human would have to do induvisually.

why is quality a concern?gives competiitve advantage, encorages return purchases, provides customers with information and builds consumer confidence on the band,reduces cost incurred in solvin sales problems, helps improve efficancy. Quality control, means checking good aafter they are produced to look for defects. it is preferred by trained quality inspectors. Quality assurance, means bringing in measures so that werrors are provented in the first place. profitability- profit or loss= total revenue- total costs. affecting profitability,( why migh revenue down) less customers buying stuf,put prices down (economy going well). ( why might costs go up) there might not be much of the resources you need avalible

UNIT  1- (starting a business) starting a business enterprise, business aims and objectives, business planning, appropriate legal structure for the business, location of the business

UNIT 2- (marketing) conducting market research with limited bugets, using the marketin mix

UNIT 3- (finance) finance and support for a small business, financial terms and simple calculations, usin cash flow

UNIT 4 ( people) recruing, motivatin staff,protectin staff through understanding legislation

UNIT 5 (prodction) production methods for manufactoring and proving a service, customer service.