business
what is a buisness activity
a business which carries out activities such as producing goods or services to gain profit
entrepreneur
a calculated risk-taker who sets up a business for financial gain
characteristics of entrepreneur
creativity risk taking and persuasive
invention?
creating something which hasnt previously existed
innovation
when you adapt a product over time to improve it
what is risk
a situation which has exposure to danger
three types of risks and define
finacial loss- when you borrow money to start up a business but need to profit to pay back this money
lack of security- security of income so need to work long hours
business failure-don't have enough money to cover the costs
rewards? 3 types
profit- to help business survive and grow
business success- growing business, good reputation
independence-make own decisions and wokring for urself
buisness plan?
a document outlining what a business wants to achieve
buisness idea
A business idea is the reason for starting a small business and the first step in the business development process
aims and objectives
overall target of the goal
market research
gathering data about customers or competitiors
purpose of business plan
A business plan allows an entrepreneur to minimise the level of risk when setting up a business.
sole trader define and a nd d
-a business that is owned and run by one person.
a-makes own decision, easy to setup, keep profits
d-unlimited liability-responsible for the debt-, long hours
partnerships define and a nd d
business that has two or more owners.
a-quick and easy to set up,shared decision-making shared responsibility for debt
d-conflict amongst owners, long work hours,one partner may let the others down and unlimited liability
private limited (ltds)
the shareholders purchase a share of the business.
a- limited liability, extra capital makes growth easier, more staff
d- expensive, decisions may take longer, share profits
public limited (plcs)
business that is managed by directors and owned by shareholder
a-limited liabilty, firm can become large, shares sold publicly, finace raised by selling shares
d- expensive, share profits, pay dividends, risk of takeover