national 5 business management 1.1 business activity
DESCRIPTION
Slides for N5 Business ManagementTRANSCRIPT
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1.1 Business ActivityN5 Business Management
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What is a Business?
A business is an organisation that exists to satisfy needs and wants.
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Some Key Terms
CustomerConsumerSupplierTurnoverCostsProfit
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Needs and Wants
A Need is a basic thing humans have to have in order to survive. I.e. Food, water, shelter and clothes are all needs.
A Want is something extra we would like to have. They can be luxuries or time saving devices. Cars, mobile phones, computers and CDs are all wants
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Goods and ServicesA Good is something
you can touch and feel.Goods can be non-
durable, durable or industrial
A Service is provided by someone else. A service is non-physical.
Hairdryer is a good. A Hairdresser is a service.
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Quic
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uiz
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TASK
Question Bank
1-7
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Production Stages
INPUTS PROCESS OUTPUT
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Factors of ProductionLand – all natural resources used in
production
Labour – all people used in production
Capital - all items used to make other things in production
Enterprise – the art of bringing together the other factors of production and being successful
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TASK
Question Bank
8-20
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ICT Task
Create a poster outlining Inputs, Process & Outputs of a product you like
Include suitable images & text
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Why do businesses exist?
To satisfy customer needs and wants
To satisfy consumption
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Balancing Costs and Benefits
A new airport is to be built near Blantyre. David Livingstone International Airport!
Do you think the people who live in Hamilton, Motherwell & East Kilbride would be happy?
Think of some good points and bad points about this development
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Key TermsSocial Costs – bad or negative effects
businesses have on the community
Social Benefits - good or positive effects businesses have on the community
Economic Costs – the cost of the business alternative given up
Economic Benefits – the positive, long term changes to an area
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Social costs and benefitsCostsAir/noise/water pollutionTraffic congestionLifestyle changeLocal services unable to cope
BenefitsHappier customersCreation of jobs by businessContribution to local communityCreation of jobs within other local
businesses
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Economic costs and benefitsCostsHospital v leisure centreShopping centre v Football
stadiumPub v Fast Food restaurantPacket of crisps v chocolate bar
BenefitsPeople employedWages receivedRise in standard of livingBoost to local firms
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TASK
Question Bank
21-34
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The Business Cycle
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TASK
Question Bank
35-38
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Customer SatisfactionCustomers are vital for a
business as they buy the goods and services.
Firms try to make customers happy by:
Having a quality productEffective employeesAfter sales service (including
warranties)
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Customer SatisfactionFirms may also have:
Customer Care PolicyCustomer Complaints Process
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TASK
Question Bank
39-43
Extension Task:Create Organisation Charts for:The SchoolA Local Business of Your Choice
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Are all Businesses the same?Organisations differ due to many
characteristics.
Business SizeBusiness ObjectivesType of OwnershipProduct/Service
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Mission StatementsAn organisation usually
outlines it vision or values in a mission statement.
For example, Manchester United – the world’s richest sports team, valued at £2 billion – has a simple one:
“To be the best football club in the world on and off the pitch.”
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TASK
Question Bank
44-45
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Business SizeSmall Business Medium-Sized
BusinessLarge Business
Owned by sole trader or partnership
Owned by a group of people
Owned by shareholders; run by directors
Sells goods locally
Reaches locally and/or nationally
Sells locally, nationally and internationally
Employees: <= 50
Employees: 50-250
Employees: 250 +
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TASK
Question Bank
44-49
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Sectors of Economy
Private Sector
Public Sector
Third Sector
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Private SectorBusinesses driven by profit.
That profit only benefits the owners and investors.
Financed by private money from shareholders and bank loans
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Private Sector Examples
Sole TraderPartnershipPrivate Limited
Company
Ltd & Plc
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TASK
Question Bank
50-58
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Public Sector
Provide goods and services for the benefit of the community
Run by the Government.
Public money from taxes
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Public Sector Examples
Devolved Services Local Services
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TASK
Question Bank
59-89
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Third SectorNot driven by profit but by need
to help parts of the community
Money from donations and gifts
Can be a Social Enterprise
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Third Sector Examples
CharitySocial Enterprise Local Sports Club
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TASK
Question Bank
90-101
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ICT Task
Create a PowerPoint presentation comparing an organisation from each of the 3 different sectors of ownership:
Private (examples, advantages & disadvantages)Public (examples, advantages &
disadvantages)Third (Voluntary) (examples, advantages &
disadvantages)
Include suitable images & text
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Business Objectives
SurvivalProfit MaximisationGrowthProvide a ServiceCustomer ServiceSales MaximisationSocial Responsibility
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TASK
Question Bank
102-109
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Sectors of Industry
Primary Sector
Secondary Sector
Tertiary Sector
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Primary Sector
This covers raw materials which are straight from land, sea and air
MiningFarming FishingOil and gasForestry
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Secondary Sector
This uses the raw materials and turns them into finished goods
Car manufacturingEngineeringShipbuildingElectronics
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Tertiary Sector
This covers all services:
InsuranceEducationFire ServiceHealth ServiceLeisure IndustryTravel & TourismDistribution
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Production ChainProduction is the transformation
of raw materials into the finished product
IPO or Input – Process - Output
INPUTS PROCESS OUTPUT
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Creating WealthWealth is created by adding
value to each stage of the production process
Selling Price = Cost of materials + Value
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TASK
Question Bank
110-115