101 enterprise

Question 1

explain the meaning of enterprise and SMEs

Answer 1

• Enterprise-having the skill and taking the initiative and the risk to make a business happen , an enterprise is also another word for a business
• SME-means small medium sized enterprise. defined as businesses with fewer than 250 employees , small turnover less than £50m

Question 2

explain how satisfying needs and wants can give opportunities to entrepreneurs?

Answer 2

• Needs- what people require to survive eg.food, they’re limited
• Wants-what people desire eg.better clothes , they’re unlimited .
• needs and wants are charging-gives entrepreneurs opportunities to enter the market and meet consumers needs/ wants

Question 3

identity business opportunities

Answer 3

• when a market that has not been targeted or where a product can be improved
  -though looking/listening to complaints/criticisms about a product/service
  -where a service can be offered to businesses to help them increase sales , production , communication

Question 4

explain the role of the entrepreneur

Answer 4

-entrepreneurs use an idea , start a business, take on the financial risk , in hope for profits
-they start/ run business , -make products and provide a service , -employ people

Question 5

explain the financial and non -financial motives of entrepreneurs

Answer 5

-earn an income and make a profit , redundancy money can be used at start up capital(financial)
-identified a gap in the market and the sense of personal satisfaction gained from filling it , be their own boss , make use of skills eg.IT (non -financial )

Question 6

characteristics and skills of entrepreneurs

Answer 6

-risk taker
-creativity and innovative
-hardworking and determined

Question 7

explain the importance of entrepreneurs and SMEs to the Uk economy

Answer 7

-bring new ideas into the market , develop new technologies
-helps economy by bringing new jobs as they pay tax
-economy is boosted-provides new products which people buy , more money spent means economy grows and better standard of living

Question 8

what are are sectors of the economy ?

Answer 8

~primary-extracts raw material
~secondary-process and manufacturing products from raw material
~tertiary-provide goods and services eg.shop - this sector employs 80% of those who are in employment

Question 9

positive impacts of entrepreneurs and SMEs on businesses and the economy

Answer 9

-creates jobs(contributes to 60% of all jobs in the uk ), more jobs , more income, more money spent, creating more demand , profit and employment
-SMEs pay tax by employing- goes to government for them to pay for hospitals ext
-creates competition , good for customers(prices are lower, quality higher)

Question 10

negative impacts of of entrepreneurs and SMEs on businesses and the economy

Answer 10

-they have high failure rate(80% of uk companies fail within the first year)
-smaller budgets -no funds to compete with larger organisations to research/ development , marketing ext- affecting ability to provide high quality solutions to customers

Question 11

what is a stakeholder

Answer 11

is any individual or group of people that have a vested interest in the business/ organisation eg.managers , employees , customers, community, suppliers , government

Question 12

describe how stakeholders (shareholders, managers,customers ) are affected by a business

Answer 12

~shareholder- want a business to make profit so they will receive a dividend (% of the profit) increasing wealth
~managers-retain jobs and earn as much profit add possible
~customers-want efficient service, quality product at a competitive price -can cause conflicts as lower prices and high quality can decrease profit

Question 13

describe how stakeholders (employees , suppliers , government , community ) are affected by a business

Answer 13

~employees-want a good working condition and job security eg.more holidays can raise costs and reduce profits so conflicts with stakeholders who want as much profit as possible
~suppliers-fair price, paid on time , large businesses reduce paid price to suppliers/delay payments- financial difficulty/ conflict
~government-want business to pay tax on their profits/employ people , less need to pay on benefits , more revenue it can collect from taxes . -government wants to reduce pollution but this can cause conflict , raise costs , reducing profit
~community-want business to act responsibly by providing employment/not destroying local environment, conflicts arise when business cuts employment or is polluting/noisy eg,lorries