paper 1 Flashcards
(266 cards)
1
Q
what is risk
A
possibility the business will have a lower than anticipated profit or experience a loss
2
Q
what is uncertainty
A
business is unable to predict external shocks or future events
3
Q
mass market advantages
A
wide range of customers
economies of scale
4
Q
mass market disadvantages
A
competition is high
5
Q
niche market advantages
A
less competition
know customers
6
Q
niche market disadvanatges
A
smaller target audience
small market
needs to be innovative
7
Q
benefits of branding
A
added value
brand awareness
strengthen social and ethical considerations
increased trust and loyalty
positive relationships
8
Q
drawbacks of branding
A
harm reputation
increased pressure
9
Q
benefits of dynamic markets
A
new customers
new competition
opportunity to be niche
10
Q
drawbacks of dynamic markets
A
increased product and development costs
continuous marketing costs
11
Q
online retailing benefits
A
shop from home
more accessible
saves time
wide audience
12
Q
online retailing drawbacks
A
hacking
poor quality
less support
security
hard to access audience
13
Q
9 factors of market change
A
economic growth
demographics
market size
economy
social
emerging markets
ethics
competition
market growth
14
Q
porters 5 forces
A
competitive rivalry
power of suppliers
power of consumers
threat of new entrants
threat of substitutes
15
Q
8 business objectives
A
survival
profit maximisation (shrinkflation)
sales maximisation
market share
cost efficiency
employee welfare
customer satisfaction
social objectives
16
Q
benefits to market research
A
effective decision making
reduces costs of poor decisions
develop marketing plan
prepare for market change
17
Q
drawbacks of market research
A
time consuming
may be unreliable
18
Q
5 primary research methods
A
questionnaire
observations
focus group
interviews
test marketing
19
Q
benefits of primary research
A
exact data needed
representative sample size
relate to business
20
Q
drawbacks of primary research
A
time consuming
expensive
sample bias
21
Q
benefits of secondary research
A
easy and quick to access
easier to analyse and interpret
22
Q
drawbacks of secondary research
A
less relevant
lack accuracy
23
Q
market segmentation benefits
A
increase revenue
increase loyalty
specific target marketing
24
Q
market segmentation drawbacks
A
expensive to adapt
limited production
high marketing costs
25
market mapping benefits
see perceptions compared to competition
identify gaps in market
show USPs
identify competitive rivalry
26
market mapping drawbacks
moment in time
relies on primary research
27
10 porters generic strategies
price leadership
added value
innovation
reliability
reputation
quality
advertising
branding
convenience
customer service
28
8 factors effecting demand
changes in price of substitutes
complementary goods
changes in incomes
fashions, tastes + preferences
advertising and branding
demographics
external shocks
seasonality
29
5 factors effecting supply
cost of production
introduction of new technology
indirect taxes
government subsidies
external shocks
30
design mix
function
aesthetics
cost (economic manufacture)
31
5 waste reduction
waste minimisation
re-use
re-cycle
up-cycle
ethical sourcing
32
6 promotion mix
above the line advertising
below the line advertising
direct marketing
personal selling
public relations
sponsorship
33
promotion pros and cons ?
short or long term
product life cycle
cost
can success be measured
34
4 types of branding
manufacture / corporate branding
product branding
own label branding
rebranding
35
3 branding to reflect social trends
viral marketing
social media
emotional branding
36
6 pricing strategies
cost plus pricing
price skimming
competitive
penetration
predatory
psychological
37
cost plus pricing benefits
easy
protects profit margins
38
cost plus pricing drawbacks
ignores market conditions
ignores competition
39
price skimming benefits
high profits
creates a brand
40
price skimming drawbacks
decreases barriers to entry
works well to competitors
41
competitive pricing benefits
customer loyalty
42
competitive pricing drawbacks
risk wars
risk loss
43
penetration pricing benefits
catch competition off guard
minimises cost focus
44
penetration pricing drawbacks
competitors retaliate
customers leave
45
predatory pricing benefits
deters new entrants
46
predatory pricing drawbacks
customers leave
illegal sometimes
47
psychological pricing benefits
appears in lower price bracket
48
psychological pricing drawbacks
demand for even lower prices
feel manipulated
49
direct distribution benefits
collect data on habits
faster delivery
build relationships
respond to feeback
50
direct distribution drawbacks
distribution is complex
harder to find products
51
indirect distribution benefits
share shipping and storage costs
benefit from third party
52
indirect distribution drawbacks
slower delivery
shared profits
53
5 stages in product lifecycle
development
introduction
growth
maturity
decline
54
extension strategies
updating packaging
adding value
adapting product
new market
advertising
reduce price
55
4 elements of Boston matrix
star
cash cow
question mark
decline dog
56
whats a star on boston matrix
high market share
high market growth
57
whats a cash cow on boston matrix
high market share
low market growth
58
whats a question mark on boston matrix
low market share
high market growth
59
whats a decline dog on boston matrix
low market share
low market growth
60
benefits of boston matrix
decide what needs investment
review product portfolio
61
drawbacks of boston matrix
too simple
could be in middle of category
62
3 customer loyalty
customer service
loyalty cards
saver schemes
63
inelastic demand values
in between 0 and 1
64
elastic demand value
greater than 1
65
benefits of using PED
decide staffing
inventory
predict cash flows and profits
66
4 factors effecting PED
availability of substitutes
frequency of purchase
necessities
luxury goods
67
luxury good values
above +1
68
normal good values
above 0
69
inferior good values
less than 0
70
benefits of using YED
predict and plan price changes
aids budgeting
helps production
71
profit =
sales revenue - total costs
72
sales revenue =
selling price x quantity sold
73
market share =
business sales / total market sales (x100)
74
percentage change =
difference / original (x100)
75
price elasticity of demand =
%change in demand / %change in price
76
income elasticity of demand =
%change in demand / %change in income
77
market growth =
(market size now / market size in past) - 1 (x100)
78
4 motivational theories
taylor
herzberg
maslow
mayo
79
taylor's theory
time and motion studies
financial incentives
piecework
80
herzberg theory
hygiene factors - absence demotivates but presence doesn't motivate
motivating factors - non-financial
81
maslows theory
hierarchy of needs
1. self actualisation (top)
2. self esteem
3. social needs
4. safety needs
5. basic needs. (bottom)
82
mayos theory
Horthorn electrical plant
social needs
team-working
83
5 financial incentives
piecework
commission
bonus
profit share
performance related pay
84
piecework benefits
efficiency
more experienced benefit
85
piecework drawbacks
increased pressure
decreased quality
86
commission benefits
benefits hard workers
pay for work done
87
commission drawbacks
less income security
high risk
quality suffers
88
bonus benefits
increased motivation
increased productivity
89
bonus drawbacks
damage moral
employees may demand
90
profit share benefits
motivation
loyalty
tax
91
profit share drawbacks
not mandatory
not guaranteed
impacts profits
92
performance related pay benefits
focus morale
benefits relationships
93
performance related pay drawbacks
competitive
demotivate if unrealistic goals
94
8 non-financial incentives
delegation
consultation
empowerment
flexible working
job enrichment
job enlargement
job rotation
team working
95
delegation benefits
builds trust
engagement between works
focus tasks
96
delegation drawbacks
quality suffers
additional training costs
97
consultation benefits
promote problem solving
workers feel involved
98
consultation drawbacks
views not used
no credit to employees
99
empowerment benefits
improves trust
encourages creativity
gives feedback
100
empowerment drawbacks
job insecurity
managers become uncomfortable
101
team working benefits
increased productivity
less competition
individual strength
102
team working drawbacks
wastes time
103
flexible working benefits
cope with demand fluctuations
extend opening hours
104
flexible working drawbacks
poor quality
lack of communication
105
job enrichment benefits
challenging
learn new skills
workers more involved
106
job enrichment drawbacks
more workload
decreases productivity
107
job enlargement benefits
increased responsibility
career growth
improve skillset
108
job enlargement drawbacks
more work but same pay
109
job rotation benefits
less boredom
skilled in all areas
110
job rotation drawbacks
poor quality
training costs and time
111
10 flexible workforce
multiskilling
part-time
temporary
flexible hours
home working
outsourcing
permanent
full time
shift work
0 hour contract
112
multiskilling benefits
less staff
interesting
113
multiskilling drawbacks
don't specialise in one thing
114
part time benefits
same benefits pro rata
cost effective
115
part time drawbacks
inflexible
116
temporary benefits
meet seasonal demand and shortages
117
temporary drawbacks
expensive
training
118
flexible hours benefits
valuable staff
119
flexible hours drawbacks
confuse customers
need extra staff to cover
120
home working benefits
saves money
flexible
no travel costs
121
home working drawbacks
no socialisation
quality decreases
122
outsourcing benefits
less full / part time workers
123
outsourcing drawbacks
more expensive
less control
124
permanent benefits
job security
relationships
development
125
permanent drawbacks
get bored
limit earning
126
full time benefits
parental and holiday leave
life ensurance
127
full time drawbacks
reduced flexibility
run out
128
shift work benefits
less stress
avoid traffic
129
shift work drawbacks
sleep alignment
employee comparison rises
130
0 hour contract benefits
flexibility
unpredictable business
131
0 hour contract drawbacks
no commitment
job insecurity
132
whats collective bargaining
negotiations between workers and representatives (trade unions)
133
recruitment process
Job analysis
Job description
Person specification
Advertise the job
People apply
Short list
Interview
Selection
134
internal recruitment benefits
lower costs
know candidates
improved promotion
135
internal recruitment drawbacks
no new ideas
reduces talent pool
cause friction
136
external recruitment benefits
more talent available
more applicants
new ideas
137
external recruitment drawbacks
higher costs
can't assess in work environment
138
induction training benefits
settle in quick
likely to stay
get to know colleagues
139
induction training drawbacks
takes time
decreases productivity
140
on the job training benefits
more confidence
familiar equipment
familiar environment
141
on the job training drawbacks
pass on bad habits
lacks time and depth
142
off the job training benefits
delivered by specialists
new ideas
qualifications
143
off the job training drawbacks
expensive
less productive
not specific
144
3 types of organisational structure
tall
flat
matrix
145
tall structure benefits
clear accountability
progression opportunities
more control
less workload
146
tall structure drawbacks
confused messages
expensive
147
flat structure benefits
clear communication
positive relationships
148
flat structure drawbacks
saves money
less promotion
lots of responsibilities
149
matrix structure benefits
increases morale
utilises skills
150
matrix structure drawbacks
co-ordination problems
conflicts of interest
stretches staff
151
centralised organisation benefits
economies of scale
buy in bulk
specialisation
advertising costs spread
152
centralised organisation drawbacks
slower decision making
not flexible
demotivating
153
decentralised organisation benefits
flexible
motivating
fast decision making
154
decentralised organisation drawbacks
lack of consistency
no economies of scale
155
4 types of leadership
autocratic
democratic
lassiez-faire
paternalistic
156
autocratic leadership benefits
clear chain of command
clear directive leadership
quick decision making
157
autocratic leadership drawbacks
demotivates
ignores creative solutions
relies on competency
culture dependent
158
democratic leadership benefits
feel valued
growth and development
idea benefits
high skilled employees
159
democratic leadership drawbacks
decisions take time
depends on employee skills
unreliable staff
160
laissez-faire leadership benefits
suitable for creativity
encourages growth, development + innovation
fast decisions
161
laissez-faire leadership drawbacks
lack supervision
avoid responsibility
blame culture
162
paternalistic leadership benefits
employee loyalty
low employee turnover
effective for low skilled workers
163
paternalistic leadership drawbacks
wrong decisions cause demotivation
doesn't use skills and knowledge
dictatorial
164
5 entrepreneurial roles
innovation
expanding a business
risk and reward
creating + setting up a business
barriers to entrepreneurship
165
4 ways for setting up a business
1. market research
2. project trials
3. business plan
4. grow business
166
5 barriers to entrepreneurship
entrepreneurial capacity
access to finance
lack of training
fear of failure
lack of confidence
167
6 entrepreneurial characteristics
creativity
hard working
resilient
initiative
self-confidence
risk taking
168
6 entrepreneurial skills
communication
team working
problem solving
organisation
numeracy
IT
169
2 Financial motives
profit maximisation
profit satisficing
170
5 non-financial motives
independence
flexibility
ethical reasons
social purpose
personal challenge
171
whats limited liability
owner and business are separate
172
whats unlimited liability
owner and business are the same
173
sole trader advantages
privacy
easy to set up
keep all profits
174
sole trader disadvantages
difficult to finance
fully responsible
less free time
175
partnership advantages
shared workload
split cost
more ideas and skills
176
partnership disadvantages
disagreements
shared profits
177
private limited company advantages
flexible management
better to raise money
owner has control
178
private limited company disadvantages
high set-up costs
hard to find shareholders
division of ownership
179
public limited company advantages
tax efficient
flexible management structure
180
public limited company disadvantages
vulnerable to take overs
high set up costs
181
franchisee benefits
lower risk
get support
predictable set-up costs
marketing benefits
182
franchisee drawbacks
shared profit
less independence
strict operating rules
expensive
183
franchisor benefits
fast growth
cheaper
take away risk
more motivated
184
franchisor drawbacks
shared profit
damage reputation
high supporting costs
franchisees get merchandise elsewhere
185
online business benefits
easy to set up
accessible
paypal process transactions
managed from home
186
online business drawbacks
hacking
security
187
whats a social enterprise
business trading for social or environmental purposes to help society in some way
188
whats a lifestyle business
aim to grow big enough for a return on investment and provide great quality of life
189
whats an opportunity costs
cost of foregoing the next best alternative
190
whats a trade-off
having less of one thing in exchange for more of another
191
5 factors converting entrepreneur to leader
learning to delegate
trusting others
listening to others
less reactive
emotional intelligence
192
BRIC Economies - growing economies
brazil
russia
india
china
south africa
193
MINT Economies - emerging economic giants
mexico
indonesia
nigeria
turkey
194
implications of economic growth
changes in employment patterns
diversify away from primary sector
capital intensive production
195
growth for business
more disposable income
opportunities to move into more markets
low labour costs
196
4 indicators of economic growth
GDP
Literacy
Health
HDI
197
specialisation advantages
economies of scale
more resources
more productive
competitive advantage
GDP growth
198
specialisation disadvanatages
overeliant so don't spread risk
hard to compete if others cheaper
diseconomies of scale
199
FDI benefits
employment opportunities
more disposable income
boost economy
multiplier effect
200
FDI drawbacks
ethics
communication issues
exchange rates
redundancies
201
Trade liberalisation benefits
lower prices
broader range of goods available
diversifies risk
increased competition
benefits poorer countries
202
trade liberalisation drawbacks
dependent on industrial nations
increased competition
over cultivation of land
203
whats trade liberalisation
relaxation of tariffs and barriers
204
What does the World trade organisation (WTO) do
deal with trade rules
205
whats General agreement on tariffs and trade (GATT) do
ensure countries keep agreements they made
206
political change benefits
new jobs
low labour costs
trade benefits
comparative advantage
207
8 factors increasing globalisation
trade liberalisation
political change
significance of global companies
increased investment flows
reduced cost of transport and communication
migration
growth of global labour force
structural change
208
whats protectionism
theory or practice of shielding countries domestic industries from foreign competition
209
tariffs benefits
domestic goods are cheaper
job security
allows to sell more as price advantage
reduced in strategic trade deals
210
tariffs drawbacks
some products don't put off customers
may just increase costs
other countries may retaliate
211
quotas benefits
protects jobs
act as bargaining chip
protect strategic industries
more protective as predictable
212
quotas drawbacks
fewer export countries
higher prices as countries retaliate
complex
difficult to measure degree of protection
213
government legislation benefits
prevents fake imports
conform to safety regulations
increased customers trust
214
government legislation drawbacks
every import can't be checked
don't protect against all fakes
profits from fakes fund organised crime
215
subsidy benefits
production increase
more jobs so tax paid back to government
first mover advantage
economies of scale
216
subsidy drawbacks
retaliation from other countries
encourage unprofitable, inefficient business activity
217
4 methods of protectionism
tariffs
quotas
government legislation
subsidies
218
trading bloc benefits
access huge markets
free movement of goods and people
reach wider audience
219
trading bloc drawbacks
stop access to other trade blocs so limits markets
WTO prefers deals with wide range of nations
220
trading bloc business opportunities
freedom to trade
enlarged market
protection from international competition
free movement of people
221
trading bloc business drawbacks
developed countries dominate
kill off domestic nations
become standardised
reduce identity
222
2 pull factors
economies of scale
risk spreading
223
2 push factors
saturated market
domestic competition
224
offshoring benefits
lower minimum wage
access trade blocs
tax benefits
larger talent pool
225
offshoring drawbacks
damage reputation
increase management cost
reduce efficiency
expose business to corruption
226
outsourcing benefits
flexibility
lower costs
get experts
focus on core business
227
outsourcing drawbacks
loss of control
increased costs
quality issues
228
5 factors for country as a market
level of disposable income
ease of doing business
infrastructure
political stability
exchange rates
229
9 factors for country as a production location
costs of production
labour force skills and availability
infrastructure
trading bloc
government incentives
ease of doing business
political stability
natural resources
return on investment
230
joint venture benefits
access to knowledge and resources
new opportunities in markets and distribution
shared workload
spread risk and finances
shared professional skills
231
joint venture drawbacks
50% fail
different cultures
imbalance of power
loss of patents
231
global mergers benefits
economies of scale
reduced competition
spread risk
new skills
232
global mergers drawbacks
high initial costs
diseconomies of scale
clash of cultures
role duplication so redundancies
232
global competitiveness benefits for MNCs
economies of scale
scope for best quality sources
closer to customers
diversify risk
more knowledge
233
2 ways to gain competitive advanatge
cost leadership
differentiation
234
global marketing benefits
economies of scale
lower marketing costs
market power as known brand
consistency in brand image
leverage good ideas quickly and efficiently
uniformity of marketing
235
global marketing drawbacks
differences in needs and wants
different responses
different wage patterns
differences in development
competitive environment
legal environment
236
glocalisation benefits
access to larger markets
compete more effectively
more demand for customers as familiar
237
glocalisation drawbacks
small businesses struggle to compete
no economies of scale
complex to adapt
238
3 global marketing methods
ethnocentric
polycentric
geocentric
239
whats ethnocentric marketing
no attempt to adapt
240
whats polycentric marketing
products adapted and marketed to each country
241
whats geocentric marketing
promote global brand but still slightly tailor products
242
ethnocentric marketing benefits
economies of scale
lower development costs
243
ethnocentric marketing drawbacks
doesn't suit markets
less sales
244
polycentric marketing benefits
right for market
higher sales
245
polycentric marketing drawbacks
higher research and development costs
246
geocentric marketing benefits
attract higher sales
247
geocentric marketing drawbacks
higher product development costs
248
global niche market benefits
less competition
customer loyalty
premium prices
reduced risk
reduces PED
reduces average costs
249
global niche market drawbacks
global niche market drawbacks
250
cultural / social considerations
cultural differences
differing tastes
language barriers
unintended meanings
inappropriate translations
inappropriate branding
251
what is ethnocentrism
tendency to view own cultures and ethics superior
252
MNC's positive effects on local economy
employment
increases skills base
increases standards of living
raises countries profile
improves balance of payments
improves infrastructure
253
MNCs negative effects on local economy
profit leakage to base country
low paid jobs
pull out quickly
poor safety record
increases urbanisation
widen poverty gap
local businesses unable to compete
negative environmental damage
254
6 MNCs impacts on national economy
foreign direct investment
balance of payments
technology and skills transfer
impact on consumers
impact on cultures
impact on tax revenues
255
5 ethical issues
shareholder conflicts
pay and working conditions
supply chain considerations
environmental conditions
marketing considerations
256
4 ways of controlling MNCs
political influence
legal control
pressure groups
social media
257
political influence benefits
smoother trading
less troublesome
help trade and set up as wish for approval
258
political influence drawbacks
bribes
weak governments ignore as bring wealth
259
legal control benefits
laws can be passed at any point
protects consumers rights
260
legal control drawbacks
MNCs might move
may still break laws
deter laws as need wealth
MNCs can afford good legal defence
costs MNCs to abide
261
pressure groups benefits
raises public awareness of unethical activities
quickly alert large groups
set up boycotts
change MNCs to prevent PR issues
262
pressure groups drawbacks
needs to be large and organised to have impact
large MNCs counter or quieten groups
263
social media benefits
orchestrate boycotts
raise awareness
ensure greater transparency
creates social authority to challenge power
264
social media drawbacks
not always believed
MNCs may dust itself down
only short-term effects
people move on quickly
