Nature of Business
4 stage of the The Business Life Cycle
Establishment, Growth, Maturity, Post Maturity
What are the 5 SMART goals
Specific Measurable Achievable Realistic and Time-bound
Employee Size of an SME
Small - Less than 20
Medium - 20-199 employees
1. Why is a business plan important to business success?
a) A business plan is a legal requirement for a business
b) It will guarantee that the business will not fail
c) A business will not be granted a loan without a plan
d) It enables a business to stay focused on its objectives
d) It enables a business to stay focused on its objectives
ONE internal influence on businesses
Product, location, management, resource management, business culture
Classification by legal structure: Is Sole trader and Partnership incorporated, or unincorporated?
Unincorporated
3 functions of management
Planning, organising and controlling
Sources of Information: SME owners can receive assistance from a large number of government and private support agencies. Name ONE of these agencies
Government, education, Online, Professional, Institution, Financial
13. Which financial statement records the movement of money and is important to predict future income and timing of payments.
a) Balance sheet
b) Bank statements
c) Cash flow statement
d) Revenue statement
c) Cash flow statement
ONE contribution SME's have to the Australian economy
GDP, employment, balance of payments, invention and innovation
There are four common methods to classify businesses
Size
Geographical spread
Industry sector
Legal structure
3 management approaches
Classical, Behavioral, Contingency approach
The three main ways of "going into" a business
brand new business, purchasing an existing business, buying a franchise
11. Which of the following is considered an ongoing-cost in an employee’s renumeration package?
a) Commission
b) Overtime
c) Salary
d) Sick leave
d) Sick leave
2. Which business function uses a range of approaches to maintain and improve the quality of its outputs?
a) Finance
b) Human resources
c) Marketing
d) Operations
d) Operations
The 7 functions of a business
Profit, Employment, Incomes, Choice, Innovation, Entrepreneurship, Wealth creation, Quality of life
Define outsourcing, give an example
Contracting of some organisational operations to outside suppliers.
Eg hiring cleanings, accountant, building inspector, legal representation
Critical Issues: Name 3 critical issues in business success and failure
1. Importance of a business plan
2. Management – staffing & teams
3. Trend analysis
4. Competitive advantage
5. Overextension of finances and other resources
6. Using Technology
7. Economic conditions
19. Which of the following are two financial reasons why managers may resist change?
a) Costs of new equipment and redundancy payouts
b) Increased dividend payments and retraining costs
c) Management inertia and reorganising plant layout
d) New equipment and increased levels of taxation
a) Costs of new equipment and redundancy payouts
There is a mandatory sentence required for a business report executive summary. What is it
"The purpose of this report is to:"
- questions 1, 2 and 3
When an independent person is appointed to take control of a business with the intention to sell assets to pay creditors.
Liquidation
Identify 3 skills a manager needs
Interpersonal, communication, strategic thinking, vision, problem solving and decision making, flexibility and adaptability, and conflict reconciling.
Distinguish between monitoring and evaluating
Monitoring is a continuous assessment based on information on ongoing activities. WHERE AS, an evaluation is an examination of activities
TWO challenges owners may face during the growth stage of the business life cycle
Financial management, cash flow, costs, customers, managment change, employees, failure rate, expanding too rapidly or not enough, risk level
Difference between Mergers and acquisitions
Acquisition: (takeover) when one business takes control of another business by purchasing a controlling interest in it
WHERE AS
Merger: when the owners of two separate businesses agree to combine their resources an form a new organisation.