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HomeBusiness Theory
Business Theory
Responding to social responsibilities and ethics
Businesses work in a wider social environment in which they have a responsibility to a range of stakeholders including the wider community.
The term Corporate...
Exchange rates
Money is demanded in order for it to be used to buy and sell goods and services. The same applies to international currency. Foreigners...
Consumer protection
Consumer protection is the process of defending consumers against unscrupulous practices by producers and sellers. Over time, case law in this country has developed...
Government and EU influences on business activity
Our national government as well as the European Union play a big part in influencing business activity today:
through taxation and spendingthrough laws, directives and...
Ethics
Big businesses command a lot of power and are able to choose between working in a way that benefits only the owners, and in...
The external environment
A business converts inputs into outputs in order to make a profit. However, the business does not exist in a vacuum, it exists within...
Use of personal income
There are a number of ways of raising finance for a business. The type of finance chosen depends on the nature of the business....
The importance of business accounts
Business accounts are produced to meet the needs of their users. Typical users and the use they make of accounts are shown below:
There are...
Accounting for decisions
Management accounting uses financial information in order to enable better decision-making within the organisation. The format and content of management accounts will depend on...
Covering the costs of a new product
Costing is an important aspect of production because:
By knowing how much it costs to produce an item or to carry out an activity it...
Analysis of profitability, liquidity and performance
The profit of a business is the difference between its revenues and its costs. It is important to consider two main types of profit:
1.Gross...
The personal 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...
Product life cycle
The product life cycle is the period over which it appeals to customers. The sales performance of any product rises from nothing when the...
Market planning
Market planning is the process of developing and implementing a plan to identify, anticipate and satisfy consumer demand, in such a way as to...
Nature and role of marketing
All modern organisations engage in marketing so as to be able to please and win the loyal support of their customers. Gillette engages in...
Aims of the marketing department
The Aims of the marketing department involve a range of processes concerned with finding out what consumers want and then providing it for them....
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...
Methods of analysing marketing opportunities
Methods of analysing marketing opportunities involves collecting, recording and making sense of all the available information which will help a business unit to understand...
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...
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...
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,...
Control of business activity
Control of business activity takes place at two levels - control from within the organisation and external control.
Internal control
Internal control involves the creation of...
Dealing with customers
Customer service is the overall activity of identifying and satisfying customer needs.
The term is used in three different ways:
As a contrast to 'products'. Products...
Trade unions
Trade unions are organisations formed, financed and run by their members in their own interests, and several have existed for over a hundred years....
Methods of management
Management has been described as getting things done by other people. Managers have the responsibility of enabling an organisation to achieve its objectives. They...
Communication negotiation and consultation
Negotiation involves discussion to make agreements where the parties involved have some difference of interest or simply negotiation of how a task or project...
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...
Human resources
Human resources are the people that work for an organisation, and Human Resource Management is concerned with how these people are managed. However, the...
Rights and responsibilities of employers and employees
Employers and employees have responsibilities to each other, they should also expect their rights to be upheld. These rights and responsibilities relate to areas...
Business strategy
A business strategy is the means by which it sets out to achieve its desired ends (objectives). It can simply be described as long-term...
The basic economic problem and opportunity cost
The basic economic problem is that resources are scarce relative to the purposes for which they could be put. As a result, choices have...
Support and advice to business
There are a number of bodies that provide support and advice to businesses, ranging from the local Chamber of Commerce or Chamber of Trade to...
Devising and implementing a strategy
A strategy is a long-term plan for the whole organisation. Igor Ansoff defined corporate strategy as 'The positioning and relating of the firm/organisation to...
Aims and objectives
Business activity is focused on the achievement of business aims and business objectives.
A business aim is a goal a business wants to achieve. A...
Economic growth
Economic growth is important if businesses are to grow and prosper. It relates to growth in the output of the economy as a whole....