Entrepreneurship
What is an entrepreneur?
A person who sets up a business and takes on financial risk.
What is market research?
The process of finding out what customers want and need.
What is insolvency?
Term used for when a business fails due to the inability to financially cover their costs.
What is a partnership?
A legal form of business ownership run by 2-20 people.
What is a stakeholder?
Individual or group that have an interest in a business and can be affected by their decisions.
What is the main purpose of a business?
To provide goods and services.
What is a market segment?
Customers who buy similar product because of their age, income or lifestyle.
What is break-even?
A situation where total revenue is equal to total costs.
What is unlimited liability?
This means that the owners are personally responsible for all business debts.
What are two types of technology used by a business?
E-commerce, social media, digital communication and payment systems.
What is profit?
A financial reward that can be calculated using costs and revenue.
What is secondary research?
Using existing market reports, websites, and government data.
How do you calculate net cashflow?
Cash inflows - Cash outflows
What are the elements of the marketing mix?
Product, price, place and promotion.
What are three principles of employment legislation?
Recruitment, pay, discrimination, health and safety.
What are the three risks?
Business failure, financial loss, lack of security.
What is market mapping?
Plotting competitors onto a matrix to identify gaps in the market.
What is the purpose of trade-credit?
It allows the business to purchase supplies now, but pay for them later.
Why would a business use e-commerce?
They would no longer require the use of a physical premises and save on their fixed costs e.g. rent.
What is the impact of an increase in consumer income on substitute goods?
There would be an decrease in demand.
How could a business add value? (Explain one way)
They could use better materials to improve the quality and produce a USP.
How could a business be more competitive? (Explain one way)
The business could increase their product range or lower their prices.
What is a drawback of crowdfunding?
If the business does not get enough finance from supporters in time, cash will be returned to the supporters.
What is the purpose of a business plan?
The business would do this to minimise risks and obtain finance from a bank to fund expansion or other opportunities.
What is the impact of a strong pound?
Imports are cheaper, exports are dearer. SPICED.