Business Unit 1

An Entrepreneur is anyone who starts a business.

6 Characteristics a succeful entrepreneir have:

• Hard Working
• Resilient
• Creative
• Self-confident
• Take Calculated risks
• Initiative

Non-profit motives

• Desire to be your own boss
• Prove yourself
• Employment
• Love of the business world
• Independence
• Lifestyle choice
• Ethical Stance

Profit motives

• Satificers - making enough money for a good qualify of life
• Profit maximisers - to get as much profit as possible 

Start-up costs - monney you have to spend to set up the business

Running costs -  the day-to-day costs

Sales revenue - selling price X number of units sold

Fixed costs -  the costs that don't change when output does

Variable costs - costs that changes when output does

Total variable costs - number of units X variable cost per unit

Total costs - fixed costs + total variable costs

Gross profit - sales revenue - total variable costs

Net / Operating Profit - gross profit - fixed costs = sales revenue - total costs

Leadership - the process of influencing others to work towards an organisation's goal.

The main ones are:

Autocratic - makes all decisions, often ruthless, one-way communication, feared.

Pro - Fast decisions.

Con - Subordinates (employees) don't get heard

Laissez-faire - leave decision-taking to employees, allowing them to be creative

Pro - empowers employees and encourages them to think for themselves

Con - not suited to all industry types

Democratic - consult widely and encourage employees to take part in decision-making process.                                                                                                     

There are 2 main types of democratic leaders:

Paternalistic - someone that takes a general interest in staffs and their needs

Consultative - someone who asks staff their opinions and makes decisions based on then

Pro - gets alot of new ideas from employees, and may be encouraged to work harder

Cons - decision-making process is lengthened

Good leaders tend to have the following:

• Competence
• Analysis and synthesis skills
• Social skills
• Commmuncation skills/charisma
• Self-belief
• Energy and drive