A stakeholder is someone who has an interest in the business, this could be for the business to succeed/fail or grow/decline depending on who the stakeholder is. Some of these stakeholders are:
Stakeholders can offer oportunities to a business, they can bring in investment, new staff etc.
But they also can run the risk of having conflict between them. Stakeholder conflict can be dangerous to a business and can also be incredibly beneficial, it depends on the stakeholder.
Sources of finance - short term
Overdraft - when a business makes an arrangement with a bank to allow them to take more money out than they actually have.
Loan - normally provided by banks, pay the money back over time with interest. can be short, medium and long.
Trade Credit - taking a longer time to pay creditors can be used to raise finance?
Hire Purchase - paying for something over a long time, at the end own it. End up paying more than paying outright.
Sources of finance - medium term
Leasing - hiring something out, giving it back at the end. Never own it.
Shares - owning part of a business.
Sales and Leasing - selling an asset and leasing it back to raise finance?
Selling Assets - selling fixed assets such as machinery.
Reducing Stock - firms can improve liquidity? by running stock levels down. No dead money.
Retained Profit - profits that the owners decide to keep in the business.
Factoring - selling debts to another company.
Re - Invest Saving - retained profits from previous years.
Types of business
Primary - farming/mining
Secondary - factories
Tertiary - retail
Public Sector - provides a service
Public ltd - shares can be bought by anyone
Prviate Sector - makes a profit
Private ltd - owners choose who to sell shares to
Cash flow issue:
- too much stock
- poor late payers
- poor economic conditions
- seasonal demands
- distrabution issues
Improving cash flow:
- working capital reconstruction?
- increasing sales
- selling off stock at sale prices
- reducing credit periods?
- just in time
-> demand for labour
-> nature of job
Describing the market:
- exploting trends
- comparing market performance
- establish market share
- finding customer base
Explaining the market:
- why the market share has fallen?
- whether customerts prefer products or competition
- how good was promotion
Types of sampling:
sample size - the number chosen to be inckuded in the research
population - total number that could be included in sample
primary - collected first hand, interviews etc
secondary - data already collected by somebody, sales figures etc
What Business' Do
- meet costomer and stakeholder needs and wants
- buy materials etc (input)
- create products (output)
- generate profit
they must appeal to customers through a prodcut theyd wish to have
must appeal to the governement by employing people, keeping unemployment down
- pay for raw material
- transform into a good
- sell the good
what is produced?
- non durable - a product that can only be used once
- duable - a product than can be used more than once
- services - purchases that do not involve buying a tangable item
Demand and Supply
Both directly affect eachother.
Factors affecting demand:
- price of rivals
Factors affecting supply:
- more suppliers entering the market
- existing suppliers increasing their quantities
- cost of production - raw materials, wages, expenses
2 or more rivals.
Compared in price and differentiation
Direct competition - head to head rivarly, product/firm
Indirect competition - exists between producers/sellers who competing for some value of consumer spending
Competitors - Perfect and Monopolistic
- large number of firms
- products are homogeneous
- no barriers to entry
- no firm controls prices
- large numbers of firms
- products ar close, not substitutes
- some control over pricing as a result
- small barriers to entry
Competitors - Oligopoly and Monopoly
- few firms dominate market (control 75%)
- high barriers to entry
- goods can be homegeneous or highly differentiated
- firms behaviour heavily affected by rivals
- dominated by one firm (25%)
- massive barriers to entry