Business Theory

Businesses operate in an external environment in which as well as competition from rivals businesses have to take account of legal, political, social and...

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....

A multinational company is one that operates in more than one country and typically operates in a number of major global markets. The three...

The term business in the community relates to the relationships that a business develops with stakeholders in its external environment. In addition Business in...

The international environment is very important today. Globalisation, the process whereby businesses develop worldwide brands and products which they supply across the world, and...

Regulation means providing rules and frameworks for business and other activities. Some aspects of business activity are self-regulating - for example, the Advertising Standards...

Opportunities in the business environment are those factors that provide possibilities for a business to expand so as to make more sales and profits....

Budgets are statements setting out the planned performance of a business type in a table made up of numbers. Usually, these plans deal with...

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...

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...

Sources of finance are where finance comes from. For example, Bank loans,Owner's (share) capital,Trade credit, The MFI case study shows how MFI was able to obtain finance...

Accounts are records of financial transactions. Information that is used in accounts is initially entered into books of prime entry, which may simply be...

Customer satisfaction refers to the extent to which customers are happy with the products and services provided by a business. Customer satisfaction levels can...

Customers are people who buy products and services from other people (usually companies of one sort or another). What customers think, and feel about...

All modern organisations engage in marketing so as to be able to please and win the loyal support of their customers. Gillette engages in...

A distinction is frequently made between needs and wants. Our needs make up our survival kit while our wants are the desires we have...

Competition occurs when two or more organisations act independently to supply their products to the same group of consumers. There are two bases on which...

Creating strategies that meet customer needs in the marketing mix, when marketing their products firms need to create a successful mix of: the right product sold...

Responsible production involves the production of goods and services in an ethical way which involves the minimisation of waste and pollution. In the past...

The health and safety of employees in the workplace are major concerns for employers and employees. Detailed employment laws and legislation have been created...

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...

Businesses hold stocks in a variety of forms: raw materialswork-in-progressfinished goodsconsumablesplant and machinery spares. The aim of stock control is to make sure that a business...

In business terms, innovation is the commercial exploitation of an invention. This involves dedicating resources and bringing a new idea to market. The succession of...

Specialisation is a key feature of complex industrial societies like our own. It takes place at a number of levels: the division of labour specialisation of...

Businesses need to make choices when recruiting staff and when choosing staff for training or promotion opportunities. Choosing one potential candidate over another is...

In the past large sections of the workforce worked on full-time permanent contracts. This was typical of most large British companies. Since the 1980's...

Core competencies are the skills that allow a business to deliver a benefit to customers, and capabilities that are critical for a business to achieve a...

Employers and employees need to have some system for communicating their views and requirements to each other. Employee-employer relations take place at two main...

Management has been described as getting things done by other people. Managers have the responsibility of enabling an organisation to achieve its objectives. They...

Unemployment is typically associated with labour i.e. employees who make themselves available for employment not being able to find work. However, it can also...

Organisations have a formal structure which is the way that the organisation is organised by those with responsibility for managing the organisation. They create...

Today we live in a global economy in which the time taken for people to move between continents has been significantly reduced and in...

To be enterprising, one must be willing to take risks and think creatively to find innovative solutions to problems. The term culture refers to...

Good business planning is an essential requirement if a business is to succeed. A business plan is a document setting out information about the...

The internal organisation of a business is the way in which it is structured to carry out its various activities. A lot of attention...

Businesses require inputs of time, information, people, raw material, premises, capital, labour and paperwork. You can see from this list that considerable managerial skills...