Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
66 Cards in this Set
- Front
- Back
|
What are advantages of budgets |
-They provide direction and coordination -They motivate staff -They improve efficiency -They assess forecasting ability |
|
|
Disadvantages of budgets |
-Difficult to monitor fairly -Allocations may be incorrect -Changes may not be allowed for when a budget is reviewed |
|
|
What is the purpose of marketing |
-anticipate customers wants -Satisfying customers -Meeting the needs of organisation -Meeting aims and objectives |
|
|
Advantages of niche marketing |
-Less competition -Costs -Small-scale production -Tailor-made products (usp) -Targeting customers |
|
|
What are the main features of business to business marketing |
-Larger transactions -Specialist buyers and sellers -Quality -Informative advertising -Pricing -Buyer seller relationships |
|
|
Disadvantages of niche marketing |
-Lower profits: only target one specific market therefore limited customer base -Changes in demand: consumers may not want/like product anymore -Market entry |
|
|
Advantages of mass marketing |
-Large-scale production -High revenues -Barriers to entry -Research and development -Brand awareness |
|
|
Disadvantages of mass marketing |
-Fixed capital -Changes in demand -Competition -Adding value |
|
|
What are influences on the marketing mix |
-Finance: cash flow, discounts, budget -Market research: competition,availability of substitutes, consumer opinions, niche/mass, market segment
-Elasticity of demand -Business reputation |
|
|
Influences on the development of new goods and services |
-Technology -Competitors -Entrepreneurial skills -Market research -Personal experience -Environmental awareness |
|
|
Name some extension strategies |
-attracting new market segments Modifying product e.g new variations -target more markets e.g countries Promotions, special offers |
|
|
What are the financial implications of product life cycle |
-Development: high costs for advertisement, equipment, (promotion) -Introduction:high costs for promotion -Growth:increase in sales revenue -Maturity: high profits -Decline: negative cash flow |
|
|
Elements of promotional mix |
-Public relations -Branding -Merchandising -Sale promotions -Direct selling e.g telephone,mail,personal selling, door-to-door -Advertising:radio,TV,newspapers,posters,magazines Sponsorship,internet |
|
|
Influences on choice of promotional mix |
-Objectives of the campaign -Cost somebody gets -Target market -Legal factors |
|
|
What do organisation charts show |
-Design of organisation -Who is answerable to whom -Span of control in each division -Channels of communication |
|
|
Explain span of control |
-The number of subordinates whom a manager is required to supervise -if manager has many subordinates= wide span of control -if manager has few subordinates=narrow span of control |
|
|
Features of a tall structure with narrow span of control |
(Many managers so narrow span of control) -more staff=more costs -less delegation may cause less stress but could lead to lack of commitment -allow control to be kept in organisation which is good for quality -Poor communication -Longer chain of command means longer for decisions to be made |
|
|
What are features of flat structures with wide span of control |
-managers may have to spend less time on subordinates so must Delagate effectively -more delegation means greater responsibility; use of ability/more stress -better communication Reduction in costs therefor efficiency within organisation |
|
|
Improving effectiveness of delegation |
-Based on trust between manager and subordinate - select someone who is skilled,trained and informed about task -tasks clearly explained to avoid mistakes |
|
|
Advantages of delegation |
-Management time reduced:reduces stress -Motivation: increases job satisfaction -Flexibility:quicker responses to change -Staff development: staff can have higher positions |
|
|
Disadvantages of delegation |
Quality of staff Less delegation in small firms Crisis situation |
|
|
What are the problems with high labour turnover |
-High recruitment and selection costs -High training costs -Reduced productivity -Low morale among existing staff |
|
|
How to improve labour productivity |
-make sure hire staff with right skills -train staff -offer rewards -improve technology and capita |
|
|
What are the causes of high labour turnover |
Internal factors -poor communication -Low wages -Bored/unchallenging jobs -low motivation -Poor working conditions
External -Better job vacancy -Closer to home -Better transport links -retirement |
|
|
Advantages of internal recruitment |
-Employees ability already known -Recruitment process quicker -Less expensive -Reduces risk of hiring wrong person |
|
|
Advantages of external recruitment |
-Larger choice of well qualified applicants -Avoids conflict -New ideas |
|
|
What's is favourable variance |
-Total revenue is more than budget revenue -Total cost is bellow budget cost |
|
|
Annual rate of absenteeism |
Annual rate of absenteeism=total no. Of days lost/ number of days that could be workedX no employes x 100 |
|
|
How to reduce absenteeism |
-More interesting/challenging jobs -Offering bonuses -Improve working conditions -Better relationship between employers and employees -Flexible working hours |
|
|
Absenteeism caused by health and saftey |
Number of day lost/total possible working hours X 100 |
|
|
Benefits of training |
- new employees reach leek of performance expected -well skilled and knowledged, flexible employees -increases job satisfaction/motivation -increases efficiency and productivity -reduces cost e.g health -improves image of business |
|
|
Benefits of induction training |
-Increase motivation -Employees can contribute to organisation quickly -Reduce labour turnover |
|
|
How can training be evaluated |
-Questionnaires -Level of mistakes/wastage -Measuring quality of output |
|
|
On the job training |
Cheaper as employee and equipment existing can be used Quality depends on effort of instructor
Off the job- uses trained experts, meet staff from other organisations |
|
|
Motivation theories |
Taylor: believed money to be main factor that motivated people Emphasised benefits of piecework Believed specialisation and division of labour maximised efficiency
Mayo: human relations important factor Recognition/security Work is group based
Maslow: hierarchy of needs Physiological needs:e.g food/shelter/working conditions Safety: secure job/safe working environment Social: friendship, part of team Esteem: positive feedback, promotion Self-actualisation: striving to develop and achieve more
Herzberg: two-factor theory Job satisfaction: sense of achievement,promotion, responsibility/dissatisfaction: pay, working conditions, |
|
|
Non financial methods of motivating employees |
-Job enrichment: develops workers unused skills/presents them with challenges -More decision making Motivates staff: self control -Job enlargement: done through job rotation/enrichment Relieves boredom More motivated-more flexible More participation
|
|
|
Financial methods to motivate employees |
-Time rates -Piece rate -Performance related pay -Profit sharing -Fringe benefits |
|
|
How do you calculate variance |
Budget figure - actual figure |
|
|
What is adverse variance |
-Actual revenue is less than budgeted revenue -Actual costs are above budgeted costs |
|
|
What are the causes of cash flow problems |
Seasonal demand Low profits Poor stock management I.e too much stock Too much investment in fixed assets Over trading |
|
|
How to improve cash flow problems |
-Bank overdraft Ad: flexible,interest only charged on amount of overdraft used, easily accessible Dis:interest rate charged is higher than loan, bank demand immediate repayment
-Bank loans Ad:fixed interest repayment-Easy to budget as standing order organised to pay same amount each month, lower interest rates so cheaper solution Dis:bank require business to provide security (collateral)
-Sale of assets Ad: increase profit, more income Dis: hard to sell quickly,may have to sell at lower price
-Sale and leaseback Ad: Cash inflow, Flexibility Dis: rent, reduced assets, loss of asset |
|
|
What are ways a business could improve profitability |
-increase price -decrease costs -increasing sales volume by marketing/product development |
|
|
What is unit cost |
-The cost of producing 1 unit of output Total cost / units of output |
|
|
Measures of quality |
-Customer satisfaction ratings: survey Customer complaints -Scrap rate -Punctuality: deliveries on time/total deliveries X 100 |
|
|
Link between capacity utilisation and other operational targets |
Capacity utilisation and quality: if too high, no room for maintainence/staff not overworked, quality could fall
Capacity utilisation and unit costs High capacity utilisation means lower unit costs |
|
|
Advantages/disadvantages of spare capacity |
Ad: more time for maintenance/repair Less pressure and stress for staff as they are not overworked Can cope with sudden increase in demand
Dis: higher fixed costs- higher unit costs Lower profit levels Negative image on firm |
|
|
How to reduce/increase capacity |
-Selling off parts of production area: reduces fixed cost -Changing to shorter working week
-Increasing: building more factories -Staff working overtime -Hiring new staff |
|
|
Causes of spare capacity |
-New competitors entering market -Fall in demand-changes in fashion/taste -Seasonal demand -Poor marketing -Over investment in fixed assets |
|
|
Advantages and disadvantages of subcontracting |
-Business able to respond to changes in demand quickly -Subcontractors more specialised therefore more efficient
Dis: quality of service no longer in control -Opportunity cost: producer wants to make profit, so it could be more expensive than producing them self |
|
|
Advantages of a good quality system |
-Increase in sales volume -Creates USP -Allows a business to increase price -Good brand image -Reduce costs |
|
|
Issues with managing quality system |
Costs e.g materials, inspection Training |
|
|
Quality control advantages |
System using inspection to find faults in goods or services
-prevents faulty products reaching customer -Can detect any common problems, so mistakes can be put right more efficiently
|
|
|
Methods of meeting customer expection |
-Market research -Training -Monitoring Quality procedures |
|
|
Benefits of good customer service |
-Good reputation -Increase in sales volume: repeat purchases and brand loyalty Creates USP -Charge higher prices -Reduce costs -Motivates employees |
|
|
Choosing the right supplier |
Price: value for money -Allows business to reduce selling price therefore gain competitive advantages -More profitable
-If prices too low, could mean inferior quality Unreliable supplier-delivery,lack of flexibility -If consumers willing to pay high price then price not important -Suppliers do not have cash flow problems
-Capacity: suppliers can provide right amount of materials to meet customers wants Bulk buying to get discounts
-Quality: good quality materials -Reliability: stock arrives on time (just in time) -Flexibility: able to respond to changes in demand -Payment terms: allows business time to pay Interest charges if payment overdue |
|
|
Methods of improving competitiveness |
Reducing cost Improving quality Reading staff Marketing |
|
|
Role of suppliers in improving performance |
Unit costs: price reduces unit cost Offering credit so business can avoid interest related loans
Quality: flexibility
Capacity of utilisation: operating at maximum level possible React quickly to change in demand |
|
|
Types of technology |
Robotics: help assemble product Packaging Carry out hazardous jobs |
|
|
Advantages/dis of technology |
-Reduce cost -Improve quality: Less human error -Reduces waste -Improve productivity
-Reduces morale: may mean staff lose jobs |
|
|
Pricing strategies |
Price skimming: high price is charged to achieve high profit margins e.g designer Penetration pricing: low price charged to break into market Price leadership: when larger firms set price in market and smaller firms follower Predator pricing: low prices set to drive other firms out the market |
|
|
Pricing tactics |
Loss leaders: setting Lower prices on some products in order to encourage them to buy full priced products
Psychological pricing: intended to give an impression of value eg 99p |
|
|
Importance of location |
-Convenience -Accessibility -Cost of access: out of town shopping centres offering free parking |
|
|
Factors affecting method of distribution |
-Size of retailer -Type of market |
|
|
What are the determinants of competitors |
-Investment in technology -Training staff -Effective use of marketing mix -Financial planning and control |
|
|
Advantages of debt factoring |
Improved cash flow in short term as avoids interest Company chases debts which can be time consuming Increased efficiency as business will be more careful of giving credit
Loss of revenue Has to pay more for its service than for bank loan Problems with customers |
|
|
Disadvantages of quality control
|
-responsibility placed of inspector, so individuals not encouraged to improve quality of output -Employing inspectors can be expensive |
