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BUS1TF011-4

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kojigabriel's version from 2017-11-29 11:13

Section

Question Answer
business isbeing busy for commercial and profit (individual, company/corporation) and community (supplier). a legally recognized entity in economic free country to sell good or services for profit
business has objectivesexchanging work for financial return (time and money) exceptions are coop businesses or govt institution
stakeholderis company that holds interest in company (customers, suppliers, competitiors, employees)
macroeconomicsdeals with performance, behavior and economy as a whole. focus is on income, unmployment, inflation, investment, international trade
macroeconomics and price theoryfocus on individual and household decisions to spend their money, how they affect supply/demand
sole traderruns his own org, personal assets at risk, but no constraints from law or shareholders
partnershiptwo or more people who run, own and responsible for org. pesonal assetas at risk, profit divided, multiple ideas and resources
incorporated businessesowned by shareholders, can own/sell property, take legal action, can be public or private. limited liability, but must act to regulations
company fundamentalsvalues, business idea (permanent mission statement, affects other goals), vision (emtional), mission and strategy, most companies use idea as to define, mission, or both. is used to justify existence.
company strategypath to company vision, successive actions to goal
business environment analysisunderstanding business domain, reactions to changes, and responding to it with strategy. competiveness consists of of the mission, and executing shit
best way to react to changeanticipate it and take advantage before it happens
PESTELPolitics (regulation), Economics (production, interest, inflation, affordability), Socialcultural (ages, income, lifestyle, education), Technology (research, start up, how relevant software it is) is a framework or tool used by marketers to analyse and monitor the macro-environmental (external marketing environment) factors that have an impact on an organisation.
Key driveris factors that influence org, such as land availability to wine producer
Industrysegment of economy that produces goods and services
Primary industryis about changing resources into products (agriculture, fishing, forestry)
Secondary industryis like construction and construction, creating finished product. divided between light and heavy industry
Tertiary industryis more about the service industry (transport, distribution, sale and retail), focus is people interactions and serving
Quaternary industryis focused on intellectual, research, development, and information
Quinary industryis about health, education, culture, research, police, and govt industry not intended to make profit
Industry phasesemerging, growing, maturing, declining
Forces that drive competitionbargaining power of customers, suppliers ; threat of new entrants, threat of substitute products, these all drive rivalry of companies
New tech segmentationearly market (techies try it), early adopter (visionaries get interest), chasm (is breaching the market), early majority (herd mentality), late majority (conservatives restrained in purchase), late market (sceptics)
Competitor analysisdivided between close/direct competitors (other firm that does same), marginal competitors (similar, but not same segment), substitute competitors (service that are alternative), and potential competitors (future threats)
Level of important chartweighing comparisons between attributes of company vs other one in chart
Company diversifygrow, further use resources and capabilities, escape undesirable factors that affect industry, use excess cash on hand. all to meet demand, meet a new customer segment
Ansoff field growth charttop left, Market development (expanding products into new market), bottom left, Market penetration (growth in segment with current portfolio), top right, Diversification (expanding to new market with new products), bottom right, Product development (selling new offers to current customers)
In Ansoff growth chartonly expansion of products and market is true diversification
Diversification doesnt neccesarilyhave an impact on success of company, high levels are bad, refocusing it generates returns. its not good to diversify during rapid market growths, but during slowing. can be done by acquiring other companies, starting an internal company or joint venture
Strategymethod of achieving busienss goals, long term plan, it is planned with resources
Types of strategiesCorporate is defined by mission, Competitive is from business objectives which is resource driven, Functional is from strategy, Business Strategy is from one business unit and uses competitive strategy as part of it
Business Strategiesuses Product/Market, which product to which market, Market Sector, which sector should the company target, Business Integration, should the company change? Competition, should the company compete? Organization, what should the company be good at
Strategy mgmtprocess of assessing business and the industry it is involved in, including competition. it has to do with technological, economic, social, financial or political environment
Porters strategies Cost leadershipmaking lots of standard products for economic reasons, needs lots of resources and high skills, supervision, control, incentives, and products
Porters strategies Differentiationcreating unique product, value to customer, making more brand loyalty, needs highly creatitive and R and D skills
Porters strategies Segmentationselecting a few target markets, called niche, suitable for small firms
From the competitor analysis, derivesstrategy formula
Types of accountingFinancial, serves external decision makers, like stockholders or banks, Management, serves internal decisioners
Accounting must in perspectivelook forward and backwards, present also. winners see all three sides
Money measureument conceptthat money is measured, but doesnt account for unfinancial concerns, like politics, competitors, market
Going concern conceptthat company thinks it will exist forever
Cost conceptfunds entered at cost paid for it, but not market cost
Dual aspect conceptevery transaction can effect liabilities and owner equity
Accounting Periodfiscal year, is entire year, management uses interim reports for shareholders and managers
Capital Expenditurea payment made in cash over a period of a year or more. recorded as liabilities on sheet, must
Depreciationrefers to assets cost over lifespan, lose value over time. and allocating funds to that over its lifespan
Amortizationspreading funds to intangible asset over lifespan
Accelerated depreciationmuch faster way of depreciating
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