BUSINESS STUDIES UNIT 1

ENTREPRENEURIAL CHARACTERISTICS

Hard worker/ co-operative/ enthusiastic

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ENTREPRENEURIAL MOTIVES

Earn money/ work less hours/ (the reason for why people do things)

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AUTOCRATIC LEADERSHIP

-the leader makes all the decisions without referring to anyone else / centralisation/ others have no say } more ideas,get them to agree, ,miss out on useful insights, motivated if asked

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DEMOCRATIC LEADERSHIP

-decentralised, the leader encourages other people when it comes to decision making/ more ideas}increases motivation

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PATERNALISTIC LEADERSHIP

-the leader acts in a paternal mannor (father figure) / makes all decisions but does have to consider other peoples opinions/ supportive of staff} usually found in small businesses

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LAISSEZ FAIRE

-you are on your own/ no leadership} some may feel motivated others may need guidance

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THEORY 'X'

-leaders assume workers dont like work-only work for rewards/ if ok=rewarded ; if not=disciplined

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THEORY 'Y'

-workers enjoy work/like responsibility- satisfaction from doing a good job/ they want the organisation to do well/ more freedom-less formal (set task but not told how to do it)

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WHICH LEADERSHIP SHOULD BE ADOPTED?

depends on: ability of work force/ nature of the work (hard/easy) / ability of the leader/ culture of the BS/ relationship(them+us)

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MARKETS

-where buyers and sellers meet {consumer demand/business supply}

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DEMAND

-the amount of goods that people are willing to buy at a given price. (not about what people want and need)

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SUPPLY

-the amount of goods/services businesses are willing to sell at a given price level.

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MARKET ORIENTATION

-when a firm is continually identifying, reviewing and analysing consumer needs.

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PRODUCT ORIENTATION

-where businesses focus on the product itself and how to produce it.

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QUANTITIVE DATE

-where you collect mathematical data (easier to analyse over time)

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QUALITATIVE DATA

-where you collect personal information (gets people motivated/opinions/very difficult to analyse)

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SECONDARY RESEARCH/DESK RESEARCH

-information that has already been collected for you i.e- sales data

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PRIMARY RESEARCH

-first hand information that is provided for you i.e-questionnaires

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RANDOM SAMPLING

-anyone who has an equal chance of being picked (not just one area)

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CONVENIENCE SAMPLING

-people who are available at the time

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SYSTEMATIC SAMPLING

-picking every 10th person in the list

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QUOTA SAMPLING

-representative- picked randomly but not more than 80.

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STRATIFIED SAMPLING

-focus on the most likely customers

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CLUSTER SAMPLING

-where you pick people who you think will represent.

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TYPES OF FIELD RESEARCH

-questionnaires/focus groups/ customer groups/ test market;product trial/ computered sales data/ loyalty cards

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MARKET SEGMENTATION

-where a firm splits a market into submarkets which will respond to a specific marketing strategy

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MARKET AGGREGATION

-where you treat everyone the same

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DEMOGRAPHIC SEGMENTATION

-structure of the production and features } segments by age (m&s -old) / gender (cosmetics)

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GEOGRAPHICAL SEGMENTATION

-where a different part of the country has characteristics.

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PSYCHOGRAPHIC SEGMENTATION

-traits- 'young and outgoing attitudes'/ 'conservative'

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BEHAVIOURISTIC SEGMENTATION

-how the consumer behaves (frequent/infrequent)

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MARKET MAPPING/ PRODUCT POSITIONING

-this is a technique used by businesses to try and identify any potential gap in the market.

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MARKET NICHE

-where you aim at a particular and often small segment of the market

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OPPORTUNITY COST

-the next best alternative you miss out on when you make a decision.

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DIFFERENTIATION

-something that consumers would buy eg) adidas- 3 stripes

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ADDED VALUE

-this is the difference between the value of any inputs and the value of any outputs

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INTEREST RATES

-two types; 1) REWARD TO SAVERS - make deposite, they pay you/ 2) CHARGE TO BORROWERS- higher rate, you are charged when borrowing money/this is how banks earn their money

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S.P.I.C.E.D

Strong.Pound.Imports>Cheap.Exports.Dear

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EXCHANGE RATES

-measurement of value of one currency into another

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UNEMPLOYMENT

-the number of people out of work, able to work, available to work and are actively seeking work.

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INFLATION

-rise in the general level of prices overtime (positive or negative)

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DIVIDEND

-a shareholders payment

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OVERTRADING

-where a business expands too quickly without sufficient finance to fund it.

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COLLATERAL

-when you ask for a loan but you then dont pay up. a collateral can be something the bank can take away from you. eg) house

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OVERDRAFT

-when you spend more money from your account than you've actually got in it.

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VENTURE CAPITAL

-individuals with money who like to invest in ideas/businesses

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DEBENTURES

-specialist form of loan from financial institutions re payed at a fixed date.

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LEASING/HIRE PURCHASE

-payment over a time period but when it finishes the item is yours.

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STAKEHOLDERS

-anyone who has an interest in how a business works

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INTERNAL STAKEHOLDERS

-people within a business (owners)

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EXTERNAL STAKEHOLDERS

-people outside of a business (government)

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SALES VOLUME

-the amount of a product a business will be able to sell.

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VARIABLE COSTS

-two types; 1) variable cost 2) direct cost (materials/components/service providers)

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FIXED COSTS

-costs that do not change for a period of time (even when output varies)REVEN

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REVENUE

-the money received from businesses from their sales

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TOTAL REVENUE

-price x amount sold (quantity)

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BREAK EVEN

-when the total revenue is equal to the cost

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CASH FLOW

-predicts and records the flow of money into a business any time period (its revenue) and payments taking money out of the business (its costs)

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BUSINESS STUDIES UNIT 1

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