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Business Theory
Growth
Businesses grow for a number of reasons including to take advantage of a gap in the market, gain a competitive advantage over rivals, and...
Reasons for regulating business activity
Regulation means providing rules and frameworks for business and other activities. Some aspects of business activity are self-regulating - for example, the Advertising Standards...
The Business Cycle
Economic growth is measured by changes in the size of a nation’s income. There are a variety of ways to calculate national income, the...
PEST analysis
Before creating business plans or making decisions, it is important to 'scan' the external environment. This can be achieved through a PEST analysis, i.e....
Planned market and mixed economies
Three main sets of decisions need to be made by the economic system - what to produce, how to produce, and how to share...
Legal protection for customers
Consumer protection is the process of defending consumers against unscrupulous practices by producers and sellers. Over time, case law in this country has developed...
Organisations that provide financial services
Banks like Abbey provide a number of important financial services to businesses:
Loans provide businesses with expansion capital. A secured loan is one that is...
Contribution and break-even analysis
An important business objective is to break even i.e. to exactly cover your total costs by sales revenue. It is even more desirable to...
Cash Flow management
Budgets are statements setting out the planned performance of a business type in a table made up of numbers. Usually, these plans deal with...
Fixed, variable costs and break-even
The break-even point of a business is the level of output or sales at which the revenue received by the business is exactly equal...
Using a budget
A budget is a plan, which is set out in numbers. It sets out figures that an organisation like a company hopes to achieve...
The extended marketing mix 7Ps
The marketing mix is the combination of marketing activities that an organisation engages in so as to best meet the needs of its targeted...
Forecasting and business trends
Forecasting and business trends a projection into the future that is based on evidence of past results, or on other appropriate information (e.g. what...
Business competitors
Businesses exist in a competitive environment. For example, supermarkets are in fierce competition with each other to provide the best possible value for money...
Marketing techniques
A marketing strategy is an overall marketing plan designed to meet the needs and requirements of customers. The plan should be based on clear...
Market analysis and market planning
Market analysis and market planning is the process of developing and implementing a plan to identify, anticipate and satisfy consumer demand, in such a...
International marketing
International marketing involves recognising that people all over the world have different needs. Companies like Gillette, Coca-Cola, BIC, and Cadbury Schweppes have brands that...
Aiding and controlling business activity
Organisations are structured in such a way as to aid and control business activity. Typically business activity is organised around a systems approach in...
Constraints on production
There are a number of limiting factors that determine the quantity and nature of output that a producer is able to achieve within a...
Controlling operations
Operating activities (or operations) are the ongoing activities that a business is involved in - e.g. processing a customer's order in an Argos store,...
Management of change
Organisations change over time in a variety of ways. There are a number of ways in which they might change:
1. From small companies to...
Productive efficiency
Productive efficiency is measured by the number of units of output that can be produced from given quantities of inputs.
Organisations depend upon the skills...
The use of IT
Information Technology (IT) refers to techniques used in business for transmitting, storing, manipulating and retrieving all kinds of data, including speech, text, movies, graphics...
Contemporary work patterns
The UK economy is characterised by a relatively high level of flexibility in work patterns when compared with our continental neighbours. The work force...
Personnel functions
The term personnel department refers to the organisation's function that is responsible for the management and motivation of people in the workplace. The term...
Conflict at work
Disputes between employers and employees (and/or their representatives) usually occur when all the available channels of discussion and negotiation have been tried.
Reasons for...
Human resource management
Human resources are the people that work for an organisation, and Human Resource Management is concerned with how these people are managed. However, the...
Roles of people in organisations
Directors, Managers and Supervisors all have responsibilities in the workplace as do grass root operatives. Directors are individuals with a legal responsibility to the...
Employee participation
Employee participation is the process whereby employees are involved in decision making processes, rather than simply acting on orders. Employee participation is part of...
Criteria for judging success
There are different views about what makes a successful business. Typically success should be judged by the ability to meet objectives.
Criteria for judging...
Measuring performance against objectives
Management accounting uses financial information in order to enable better decision making within the organisation. The format and content of management accounts will depend...
Organisational structures
Organisations have a formal structure which is the way that the organisation is organised by those with responsibility for managing the organisation. They create...
The structure of a business
In the UK and most other countries, business is structured in such a way that most activity takes place within the private sector with...
Decision making
A business organisation is a decision-making unit that sets out to produce a product in the form of goods or services. Key decisions need...
Methods of growth economies of scale
Businesses can grow either organically i.e. through internal growth where profits are ploughed back into the business or through external growth such as through...