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Business Activity (Needs (Customers, Products/services, Relationships,…
Business Activity
Needs
Customers
Products/services
Relationships
Shelter
Heating
Land
Employees
Capital
Labour
wants
phones
furniture
computers
profit
more customers
reward
independence
self satisfaction
changing customer habits
financial
growth
main objectives
profit
survival
growth
become established
bigger market share
ownership
sole trader
owned by 1 person
advantages
low start up cost
keep all the profits
you're your own boss
disadvantages
unlimited liability
capacity to raise capital is limited
difficult to get a business loan
partnership
owned by 2-20 people
advantages
spread the risk
spread the skill set
finance is private
disadvantages
unlimited liability
the profit is shared
potential conflict
private limited
owned by at least to people who are friends/family
advantages
limited liability
easy to set up
easy to raise finance
disadvantages
may start to loose control
information can be seen on public accounts
can only sell shares to friends and family
public limited
shares can be sold to anyone in the stock exchange
disadvantages
long decision making
expensive process
accounts available for public and competitors to see
advantages
limited liability
easy to raise capital
easier to grow and expand
risk
financial
health
strained relationships
Stakeholders
Internal
employers
employees
managers
investors
External
customers
Good prices
Quality
shareholder
government
financiers
aims
SMART
S - specific
M - measurable
A - achievable
R - realistic
T - time specific
PIGS
P - profit
I - increase (market share, sales, customers)
G - growth
S - survival
entrepreneur
a person who has set up a business
characteristics
confident
determined
risktaker
creative
motivated
decisive
growth
internal
organic
expansion of current business activities
external
inorganic
growth of a business by takeover or merger
vertical
backwards
merge/takeover a business that supplies
it with goods/services
forwards
merge/takeover a business that it supplies goods/services to
horizontal
merge/takeover where two business are involved in a
similar operation