All business organisations have there own aims. These are referred to as objectives. A businesses objectives depend on a number of many different things including:
Type of organisation
Size of the organisation
Type of goods or services which the organisation produces.
Competitive environment which it faces.
The organisations history.
The different business objectives are:
Profit maximisation
Growth
Survival
Social responsibility
Provision of a service
Monday, 18 December 2006
Sole traders and Partnerships
A sole trader is a type of business owned by and managed by one individual.
The advantages of this are that it is easy to set up, the owner makes all the decisions so it is fast, and the owner receives all the profits.
The disadvantages of being a sole trader is that it is difficult to raise capital to start up the business, the owner has unlimited liability and the owner may have to work long hours to get the business up and running.
A partnership is a business owned by between two and twenty people who all have a share of the business.
The partnership is made by the people all signing the deed of partnership and has to be renewed if one partner dies or leaves the firm or a new partner is introduced into the firm.
The advantages of a partnership are that the workload can be shared, partners can specialise in certain aspects of the lob more money can be put into the business as capital.
The disadvantages of a partnership are there is still unlimited liability, it costs a lot to make a deed of partnership and partners am argue which can divide the business.
By Lenzie Academy Int 2 BM
The advantages of this are that it is easy to set up, the owner makes all the decisions so it is fast, and the owner receives all the profits.
The disadvantages of being a sole trader is that it is difficult to raise capital to start up the business, the owner has unlimited liability and the owner may have to work long hours to get the business up and running.
A partnership is a business owned by between two and twenty people who all have a share of the business.
The partnership is made by the people all signing the deed of partnership and has to be renewed if one partner dies or leaves the firm or a new partner is introduced into the firm.
The advantages of a partnership are that the workload can be shared, partners can specialise in certain aspects of the lob more money can be put into the business as capital.
The disadvantages of a partnership are there is still unlimited liability, it costs a lot to make a deed of partnership and partners am argue which can divide the business.
By Lenzie Academy Int 2 BM
Monday, 11 December 2006
PESTEC
External Factors - PESTEC
Political factors – may include Laws, Regulations and Rules
Examples include smoking ban effecting business in bars and pubs
Economic – Inflation and Interest Rates
Examples include increasing prices for airline tickets i.e. BA Aeroplane tickets
Social – may include Grey Pound (the aging population)
Examples may include products made for older people
Technological – may include Automation or e-Commerce
Examples may include online buying or production of cars
Environmental - may include Green Issues
Examples may include the problem with old refrigerators having CFC gases in them
Competitive – Price Wars and Imitations
Examples include Asda decreasing their prices and then the other big supermarkets will have to decrease them too
By Lenzie Academy Int 2 BM Pupils
Political factors – may include Laws, Regulations and Rules
Examples include smoking ban effecting business in bars and pubs
Economic – Inflation and Interest Rates
Examples include increasing prices for airline tickets i.e. BA Aeroplane tickets
Social – may include Grey Pound (the aging population)
Examples may include products made for older people
Technological – may include Automation or e-Commerce
Examples may include online buying or production of cars
Environmental - may include Green Issues
Examples may include the problem with old refrigerators having CFC gases in them
Competitive – Price Wars and Imitations
Examples include Asda decreasing their prices and then the other big supermarkets will have to decrease them too
By Lenzie Academy Int 2 BM Pupils
Multinational Companies
Multi-National companies (MNC) operate in two or more countries throughout the world and they have their headquarters in one country.
Advantages of MNC are:
Increase market share.
Take advantage of cheaper workers and premises or local skills.
Take advantage of government grants
Disadvantages of MNC are:
Language barriers.
Relationships with host countries.
Selling and marketing for example cultural differences.
On one hand the county benefits as they get more employment, they may receive a technology upgrade and also they may become a richer country.
On the other hand the MNC has power and control over the host country, also local companies may be driven out of business and finally the environment may be damaged by the MNC as natural resources may be used up.
In conclusion MNC will always be a controversial issue but in my opinion there seems more advantages for MNCs so overall I think they should stay as they benefit the majority of people.
By Int 2 Lenzie Academy Pupils
Advantages of MNC are:
Increase market share.
Take advantage of cheaper workers and premises or local skills.
Take advantage of government grants
Disadvantages of MNC are:
Language barriers.
Relationships with host countries.
Selling and marketing for example cultural differences.
On one hand the county benefits as they get more employment, they may receive a technology upgrade and also they may become a richer country.
On the other hand the MNC has power and control over the host country, also local companies may be driven out of business and finally the environment may be damaged by the MNC as natural resources may be used up.
In conclusion MNC will always be a controversial issue but in my opinion there seems more advantages for MNCs so overall I think they should stay as they benefit the majority of people.
By Int 2 Lenzie Academy Pupils
Wednesday, 15 November 2006
Stakeholders
Stakeholders are people with a key interest in a business
Stakeholders effect businesses by exerting influence over decisions
Their influence depends on the degree of their involvement or relative interest in company
Identifying Stakeholders
INTERNAL
Stakeholders effect businesses by exerting influence over decisions
Their influence depends on the degree of their involvement or relative interest in company
Identifying Stakeholders
INTERNAL
- Owners/Shareholders
- Employees
- Management
EXTERNAL
- Customers
- Banks
- Investors
- Local government
- Suppliers
- Donors (for Charities)
- Taxpayers
- Community
Stakeholder Aims/Objectives
Owners = profits, dividends
Managers = promotion, job security
Employees = wages, working conditions, job security
Suppliers = regular orders, payment
Customers = low prices, high quality
Banks = loans repaid on time
Organisational Functions
This is an introduction to the areas you will study in depth in Business Decision Areas I & II.
For now here are two presentations to introduce some key ideas about the functional areas:
Organisational Functions 1
and
Organisational Functions 2
For now here are two presentations to introduce some key ideas about the functional areas:
Organisational Functions 1
and
Organisational Functions 2
Business Sectors and Business Ownership
For these two crucial elements of Business theory, check out the excellent resources at Bized:
Business Sectors
Business Sectors
Business Ownership
Business Ownership
More information will follow on Business Ownership in a later post.
Business Sectors
Business Sectors
Business Ownership
Business Ownership
More information will follow on Business Ownership in a later post.
Sectors of Industrial Activity
Sectors of Industrial Activity
Primary Sector – businesses involved in exploiting or extracting natural resources (mining, fishing, farming)
Secondary Sector – businesses involved in manufacturing and construction. Includes utilities.
Tertiary Sector – Businesses involved in providing services such as banking, tourism, security
Primary Sector – businesses involved in exploiting or extracting natural resources (mining, fishing, farming)
Secondary Sector – businesses involved in manufacturing and construction. Includes utilities.
Tertiary Sector – Businesses involved in providing services such as banking, tourism, security
Goods and Services
Goods and Services
Goods are tangible, things we can see and touch like clothes, DVDs, cars etc…
Goods can be durable or non-durable.
Durable means they will last a long time (such as a TV set or a CD player), non-durable is a product that will be consumed or discarded (such as a newspaper or food - do you know what perishable means?)
Services are things that are done for us. They are intangible.
Q. For the terms that are in italics, write definitions of the words.
Goods are tangible, things we can see and touch like clothes, DVDs, cars etc…
Goods can be durable or non-durable.
Durable means they will last a long time (such as a TV set or a CD player), non-durable is a product that will be consumed or discarded (such as a newspaper or food - do you know what perishable means?)
Services are things that are done for us. They are intangible.
Q. For the terms that are in italics, write definitions of the words.
Factors of Production
Factors of Production
In order to produce goods and services, businesses need to use resources
Factors of Production
Land – natural resources extracted from Earth. Can be renewable or non-renewable
Labour – physical and mental effort of people in organisations
Capital – man-made resources, such as buildings, machines, tools
Enterprise – bringing together the other three factors of production
In order to produce goods and services, businesses need to use resources
- LAND
- LABOUR
- CAPITAL
- ENTERPRISE
Factors of Production
Land – natural resources extracted from Earth. Can be renewable or non-renewable
Labour – physical and mental effort of people in organisations
Capital – man-made resources, such as buildings, machines, tools
Enterprise – bringing together the other three factors of production
Business Activity, Needs and Wants, and Wealth Creation
Business activity is any activity which provides us with goods and services that satisfies human needs and wants.
Needs – a need is something essential to our lives: food, water, shelter, clothing
Wants – a want is an additional luxury that makes life pleasurable
WEALTH CREATION
A country’s wealth is measured by how many goods and services the country can produce.
GDP (Gross Domestic Product) = number of Goods & Services produced in a territory over a specific period (usually annually)
The more goods/services sold, the more likelihood of more jobs for the population, and therefore more tax to be raised for the Government.
This in turn is hopefully invested in services for the nation.
Needs – a need is something essential to our lives: food, water, shelter, clothing
Wants – a want is an additional luxury that makes life pleasurable
WEALTH CREATION
A country’s wealth is measured by how many goods and services the country can produce.
GDP (Gross Domestic Product) = number of Goods & Services produced in a territory over a specific period (usually annually)
The more goods/services sold, the more likelihood of more jobs for the population, and therefore more tax to be raised for the Government.
This in turn is hopefully invested in services for the nation.
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