Exam For Business Flashcards Preview

Business Vce > Exam For Business > Flashcards

Flashcards in Exam For Business Deck (45):

What is the importance and necessity of organisations

Team- together everyone achieves more
Important source of employment and career direction


Common characteristics of an organisation?

Two or more people
Formal or informal structure
Formal- clearly defined rules and regulations
Informal- loose work relationships


Market share

What a business earns in the way of sales or fees

A percentage of total sales in a market held by on brand or business


Differences between businesses?

Size of assets, revenue
Nature of their operations
Who runs it- sole trader etc


What are the two types of oranisations?

For profit- focus is making money, assets and market share e.g Nike

Non for profit- offering a service or charity, e.g Red Cross


Objectives of organisations?

There are two objectives financial and social objectives!

Financial- profit, market share and growth
Social objectives- training, services to the community, environmental goods e.g body shop

Mission and visual statement are also objectives


Mission statement-

A global statement that reflects an organisation reason for being the way it will be managed!


What is the difference between micro and small business?

Micro- fewer than 5 employees, most work from home

Small business- independently owned, owners and managers are the main decisions makers, hires 20 people and 100 for manufacturing


How small business helps our economy?

95% of total businesses

Nurturing and developing entrepreneurs, be outsourced, hire new kids who spend money!


What are the characteristics and give examples of the three broad types of business activity!

Primary- farmer and taking out natural resources from the earth

Secondary- fishing cannery. Manufacturing products, makes the patties

Tertiary- Nike- selling goods and services at an agreed price
Quaternary- finance insurance property education
Quinary- hospitality, health personal


A business is within the private sector? What are the two sub titles

Unincorporated- sole trader and partnership

Incorporated- private companies, public


What are the two main types of legal structure?

Incorporated and unincorporated!

Incorporated is registered and has a seperate legal entity

Unincorporated- sole trader or partnership and will have private assets siezed


What is an organisation?

2 or more people who work together to achieve a set of goals and objectives


What is privatisation?
It is when a government operates business is sold to the private sector

Public sector- government run, health, education and defence

Private- owned by individuals


Distinguish between small medium and large business!

Size- small 5-20 medium 20-200 large 2000+

Legal structure- small sold trader partnership
Medium- partnership company
Large- company, cooperative

Ownership- small private
Medium- private and public
Large- private and public


What are the two levels of external environment?

The macro environment- consists of legal, environmental and economical factors which have an impact on a business to see whether they are financial, or paying their taxes!

The operating environment- consists of consumers competitors and lobby groups which have an impact on a business when the comp rise or lower prises or consumers don't want to pay the prices


What is organisational stakeholder and stakeholder?

Employee or customer who is involved with an organisation which therefore has resposibilies towards the activities and interests

An individual or group that have a vested or direct interest with the activities of an organisation!


ACCC is responsible for promoting good business practices!

Ethics is a set of principles that an organisation need to follow!


Stakeholders interest and issues

Shareholder- receive dividends, socially responsible behaviour

Directors- ensure good ethics and social responsibility

Employees- to receive a fair wage, safe workplace

Customers- obtain high quality goods


Define KPI and how it relates to benchmarking?

KPI measures used to evuate the performance of a business in terms of efficiency and effectiveness! This relates to benchmarking as u can compare ur KPI to the industry standard


KPI- financial side?

Amount of assets, liabilities net profit and owners equity


Non financial KPI?

You have to measure staff satisfaction, environmental impact and levels of social responsibility!


Social responsibility- ethical responsibility where a government, organisation or individual has a duty to society; it's about improving relations with stakeholders

Triple bottom lining- report on financial, social and environmental outcomes!


Form of ownership structure!

Sole trader- usually a unincorporated business that has unlimited liability,

Partnership- combines 2 or more people
Has a partnership agreement that gets them away from personal debt! But it will end if the person leaves

Company- incorporation- owners are shareholders 2 forms of company private and public


What is the difference between private and public listed company?

Private- restrict to 50 shareholders, pty ltd, family companies

Public- unlimited shareholders, ltd, on the stock exchange


Options for creating or buying a business?

Starting from scratch- best option
Adv- complete control, money is yours, no goodwill, own touches
Dis- more work, longer to establish, harder to start and make money

Buying an existing business-
Adv- simpler process, existing suppliers and contacts,
Dis- buying someone else's failure, overpriced

Buying a franchise- paying for the right to use another business
Adv- low risk or fail, tested and succeeds, assistance
Dis- cannot make it ur own, a lot of pavements


Who does a business register with?

Must be registered on ASIC


How does zoning by laws affect a business!

A business can only build in a retail zone,
Others they are NOT allowed to are light industrial, heavy industrial, commercial and residential only!


Social responsibility?

Ethical responsibility where by an individual, organisations or group has a duty to society at large; about keeping key relations with stakeholders


Define ethics!

A set of moral principles that an organisation needs to follow


Why would you have a business plan?

To optimise chances of success, it states what objectives u have and how you will achieve them!


Components of a business plan?

Executive summary
Mission statement
Business profile
Marketing plan
Operational plan
Financial plan


What is in the executive summary!

Should highlight the objectives and how you will get there, the product you are selling, who your target market it etc


What is in a marketing plan?

What market you are in
Who is your competition
Who your target market is
Swot analysis
How the business will advertise


Mission statement

A statement that reflects a business reason for being the way it will be managed

What market they are targeting
A reference to the type of targets
Important values of a business


What are some different types of intellectual property?

Patent- makes the selling of device substance or Method yours

Trademark- numbers letters logo shape

Design- features and the way it looks

Copy right- art, songs and literature


Define innovation?

Define intellectual property?

Introduction of new process and methods

The property of mind or intellect, can be an inventions, rademark or original design!


How to come up with a good idea?

Family and friends
Personal inspiration
Looking overseas


Factors to consider when selecting a location!

Personal factors- proximity if you love it etc
Area profile- industry market
Demographics- population the incomes
Complementary business-
Zoning regulations
Accessibility- easy access


Why people want to start a small business?

To be independent
To become wealthy
Fill a gap in the market


Skills needed for business success!

Communications skills
Orgainisational skills
Marketing skills
Promoting skills
Financial skills
Negotiation skills
Technical skills


Qualities needed for business success!

Take risks
Think outside the square


What are two ways a business can fail?

Insolvency: business closes itself down due to it not being able to meet its financial commitments

Bankruptcy:when a business closes its doors as it cannot pay its debt!


Why do businesses fail?

A lack of manager experience
Must be able to evaluate the financial performance and performance of the business!


What are the three types of planning?

Strategical- 2-5 years

Operational- day to day, weekly and monthly adds up to a year

Tactic-1-2 years