Understaning External Influences

Question 1

Eight types of stakeholders

Answer 1

Shareholders
Employees
Customers
Managers
Suppliers
Local community
Pressure groups
Government

Question 2

Shareholders

Answer 2

Investors who are part-owners of a company

Question 3

Private limited company

Answer 3

A incorporated business that is owned by shareholders who invest in the business in return for a share of the profits and voting rights at the annual general meeting

Question 4

Public limited company

Answer 4

An incorporated business that can sell shares to the public

Question 5

Stock exchange

Answer 5

A pave where shares in PLCs can be bought and sold

Question 6

Shareholders objectives

Answer 6

To make money by being given a share of their profits of the business in return for their investments
To make money if they sell shares

Question 7

Main objectives of employees

Answer 7

To get the best possible pay and rewards for doing their jobs
To keep their jobs and to ensure that their job is secure

Question 8

Advantage to a business of having satisfied employees as stakeholders

Answer 8

They actually do the business’s work so if they are satisfied they can have a big impact on the reputation and overall performance of a business

Question 9

Stakeholders - Customers

Answer 9

Stakeholder with an influence over business because they buy a business’s products and services. If they buy a lot from that business, its sales will increase and the business will do well. If customers stop buying the business’s products , the business’s sales will decrease and lower business’s profit

Question 10

Customers’ objective

Answer 10

To get the best possible quality service or product
To get best value for money for that product or service

Question 11

Stakeholders - Managers

Answer 11

Senior employees within a business
They can influence a business because they ensure that the business’s employees work well, either in teams or individually
This then has an influence on the way in which employees provide customers with the products or services they want
Managers are also influences by the business because it pays their wages

Question 12

Objectives of managers

Answer 12

To make sure the business succeeds so that they get paid
To ensure that their jobs are secure

Question 13

Stakeholders - suppliers

Answer 13

Can have a big influence on businesses because they provide the goods or services that the business needs in order to keep on operating
Suppliers need to trade with businesses to increase their sales and are dependent on the success of the businesses that buy from them
Makes it more likely that the business will be able to egotists better payment terms or savings that they can pass on their customers

Question 14

Suppliers objectives

Answer 14

To increase sales and profits
To encourage businesses to buy from them again in the future
To grow their business

Question 15

Payment terms

Answer 15

The period of time that a business has to pay its suppliers

Question 16

Stakeholders - local community

Answer 16

Is a business stakeholder because the work of the business has an influence on them
They can support or object to the way in which it operates

Question 17

Local community objectives

Answer 17

To look after the local area and the people within it

Question 18

Stakeholders - pressure groups

Answer 18

A group of people who join together to try to influence businesses or the government for a particular cause.

Question 19

Ways a pressure group can influence the way a business operates

Answer 19

Encouraging consumers to increase the amount of a product or service that is used
Persuading customers to boycott or stop buying from a business
Encouraging businesses to behave in more ethical ways that help other stakeholders

Question 20

Pressure groups objectives

Answer 20

Trying to change something

Question 21

Stakeholders - government

Answer 21

Large influence because they are responsible for running the country
Influence all aspects of how a business operates

Question 22

How is the relationship between stakeholders and a business is defined ?

Answer 22

The business affects stakeholders
Stakeholders have an impact on a business
A business must try to satisfy all of its different stakeholders and manage any conflict between them

Question 23

Conflict

Answer 23

A serious disagreement, usually between people, countries or ideas.

Question 24

Shareholders impact on business activity

Answer 24

Sets the aims and strategy for the business, including how it behaves
Provide funding and investment to start up and expand a business

Question 25

Employees impact on business activity

Answer 25

Provide good service, which usually results in higher sales and profits

Question 26

Customers impact on business activity

Answer 26

Buy products and services Make recommendations for how to improve products and services Recommend the business to friends and on social media

Question 27

Managers impact on business activity

Answer 27

Manage employees who do the day-to-day work of the business Communicate employees’ needs to senior management Communicate the business’s needs to employees

Question 28

Suppliers impacts on business activity

Answer 28

Provide the business with the materials it needs for its products or services Affect the amount of products and services that can be produced and sold, which can have an impact on the business’s sales and reputation

Question 29

Local community impact on business activity

Answer 29

Support their local business by buying its products or services Object to the business if it has a negative impact on the local community or local environment

Question 30

Pressure groups impact on business activity

Answer 30

Change the business’s practices, such as its delivery times Improve employees’ conditions Influence customers’ opinions of the business and their buying habits

Question 31

Government impact on business activity

Answer 31

Charges the amount of tax that the business has to pay Passes new laws relating to the business and its industry Promotes different types of business activity by providing special funding for particular activities

Question 32

Disadvantages to a business when two of its stakeholders are in conflict with each other

Answer 32

If the owners are the managers as well there might be more responsibility and stress Workers - There may be job losses if jobs duplicated in a merger or takeover as only one person is needed for that job. Shareholders will expect costs to be cut. Customers - Prices could rise. With a merger or takeover, there might be fewer competitors, so the business could raise prices.

Question 33

Different types of technology used by business

Answer 33

E-commerce Social media Digital communication Payment systems

Question 34

Advantages of using e-commerce

Answer 34

Can trade around the world, at any time of day or night Can process order immediately Can give real-time order updates to customers May be able to avoid running a retail shop or other outlet and so reduce costs Easier ordering process for customers

Question 35

Disadvantages of using e-commerce

Answer 35

Can be expensive to keep up with technology Customers may have security concerns over fraud and the security of their account details Can make it harder to build relationships with customers, leading them to make purchase decisions because of price rather than brand loyalty

Question 36

Real-time

Answer 36

Live or as it happens

Question 37

Benefits of payment systems

Answer 37

Easy Fast Open 24 hours a day, 7 days a week Allow people to order immediately which is good for customer service Trends in sales can be identified quickly Can work in many different currencies Customers have come to expect it and may choose not to shop with a business if digital payment is not available

Question 38

Drawbacks of payment systems

Answer 38

May be vulnerable to fraud May be additional fees to be paid by the business

Question 39

Three main influences that technology has on the activities of a business

Answer 39

Influence on sales Influence on costs Influence on the marketing mix

Question 40

Technologies influence on a business’s sales

Answer 40

Tech means sales can be made at any time and any location. This helps increase its sales Use technology in their warehouses to track the amount of stock available. Can show customers how many of a product or service is available before customers make a purchase decision. Increase customer satisfaction

Question 41

Technologies Influence on costs

Answer 41

Keeps costs low Avoiding paperwork by using online record keeping Enabling real-time purchasing through online transactions Reducing travel costs by hosting online meetings Not needing an office or high-street shop because staff can work from home

Question 42

Technologies influence on the marketing mix - price

Answer 42

Customers shopping online will have a lot of businesses to choose from, so technology helps businesses to lower their prices in order to compete Customers can use online price comparison websites, which encourages business to lower prices Businesses can operate more efficiently and reduce costs, allowing them to lower their prices and attract customers while still making a profit

Question 43

Technologies influence on the marketing mix - product

Answer 43

Businesses can use technology to take advantage of the latest methods to produce goods and services Businesses can use technology to offer new ways to access products or services Customers can customise their product choices, which can be produced quickly using robotics

Question 44

Technologies influence on the marketing mix - place

Answer 44

Bus can use social media to make customers aware of their brands products Bus can create reliable, easy-to-use e-commerce websites that make purchasing easy for customers Cust can be impressed by a good e-commerce website or put off by a bad e-commerce website

Question 45

Technologies influence on the marketing mix - promotion

Answer 45

Businesses can use cheap digital promotional materials, such as email newsletters, which cost less than physical promotional materials such as billboards Businesses can target their advertising at customers by using cookies to track what a particular customer has even looking at online

Question 46

Cookies

Answer 46

Small files stored on a customer’s computer when the customer visits a website, which record details about that visit and can be accessed by the website when the customer visits again

Question 47

Legislation

Answer 47

The laws that a country must comply with

Question 48

The purpose of legislation

Answer 48

Protecting the rights of consumers through consumer law Protecting the rights of employees and employers through employment law

Question 49

Consumer law

Answer 49

Relates to the quality of products or services offered by businesses and the rights of consumers relating to those products or services

Question 50

Consumer Rights Act

Answer 50

Products must be of satisfactory quality, fit for purpose for which they are supposed to be used Cust have the legal right to reject goods within 30 days After 30 days, cust have the right to a repair, replacement or refund for a faulty product The retailer is responsible for safe delivery of goods Bus. Must provide the service with reasonable care Businesses are not allowed to enforce unfair terms when selling goods or services

Question 51

Reasonable care

Answer 51

In consumer law, this means offering a service that it is suitable for customers, such as providing a meal that can be eaten

Question 52

Employment law

Answer 52

Relates the way in which employees are hired and treated by businesses and sets out the responsibilities that businesses have towards their staff

Question 53

Key areas of employment law

Answer 53

Recruitment Pay Discrimination Health and safety

Question 54

How employment law ensures that employers recruit in a fair way

Answer 54

Advertising vacancies Selecting candidates Interviewing candidates Offering a candidate the job Preparing the employee to start their job Producing the employee’s contract of employment Conducting the employee’s induction programme once they start their job

Question 55

Induction

Answer 55

The period of time after an employee starts a job when they must be shown how to work safely and within the employer’s expectations

Question 56

Comply

Answer 56

Obey a command or meet a set of standards

Question 57

Minimum wage

Answer 57

The lowest legal rate of pay for employees, depending on their age and their type of employment

Question 58

Apprenticeship - minimum wage requirement - implication for a business

Answer 58

Businesses must pay a specified minimum rate to any apprentice employed by them in their first year. The rate is set by the government and changes each October. It goes up to the National Minimum Wage

Question 59

National Minimum Wage - implication for a business

Answer 59

Businesses must pay a specified minimum wage rate to any employee under the age of 25. These rates are set depending on the employees age Under 18 18-20 21-24

Question 60

National Living Wage - implication for a business

Answer 60

Businesses must pay a specified minimum wage to any employee over the age of 25

Question 61

Discrimination

Answer 61

When someone is treated differently to someone else because of a particular characteristic, such as a disability, their ethnicity or their sex.

Question 62

Law that prevents discrimination

Answer 62

Equality Act 2010

Question 63

Protected characteristic

Answer 63

Characteristics that cannot be used in the recruitment process to reject a candidate, such as age, disability, sex or gender, marriage status, pregnancy, race, religion or belief or sexual orientation.

Question 64

Impacts of legislation - cost

Answer 64

Training Equipment - changed or updated Pay Administration Licenses or professional services

Question 65

Positive consequences of meeting and not meeting legal obligations

Answer 65

Positive reputation Customers and other stakeholders feel they are being treated fairly Higher sales due to customers being attracted to buy from the business because of its good reputation Better candidates for jobs with the business, because people are attracted to work for the business

Question 66

Negative consequence of meeting and not meeting legal obligations

Answer 66

Business may be taken to court Negative media stories about the business, leading to a bad reputation A customer or employee is injured, suffer ill-health or is even killed as a result of the business’s failure to meet legal obligations Business is closed down temporarily or permanently

Question 67

Levy

Answer 67

A tax on a particular product or service

Question 68

Aspects of the economic climate that have an impact on businesses

Answer 68

Unemployment Changes in exchange rates Government taxation Changes in interest rates Inflation Changing levels of consumer income

Question 69

How does unemployment being low and falling affect businesses ?

Answer 69

there are fewer potential employees that can hire They may need to put up their wages in order to attract potential employees to work for the business People’s income is higher, so they have more money to spend on products and services because they are in work and receiving wages Employees are happier because their jobs feel secure as the economy is doing well

Question 70

Globalisation

Answer 70

When businesses operate on an international scale and gain international influence or power