Not for business. English F: What is your immediate goal for your company? English M: Making those deadlines can be backbreaking. English F: Is there anything Coles English: Harvey informs me you want to keep this low key. Bill says you like the proposal. See you then. Lian: Yes, thank you. Douglas: Now, Harvey informs me that you want to keep this meeting low -key.
So, I could show Harvey: Good. Would you like a tea or coffee before we start? English Female: Do you mind if I call you Charlie? English Male: Not at all. English Female: Do you mind if we work back until eight?
English Male: Neither can I. English Female: I am too. English F: Would you like me to pick you up? English M: Would The Silver Heaven people. If I… if we could get a contract with them, well it would do a lot for my… for the company. English female: Would it be OK to meet after five?
English male: Is it all right with you if English Male: What we recommend is a holiday promotion. English Female: Can I suggest The author hopes that the book, as well as providing essential subject support, will achieve two further objectives. Firstly, that it will encourage students to be observant and curious about all forms of business activity. Secondly, that, as a consequence, they will be keen to discover what is happening in business organisations, at international, national and local levels, and to bring these findings into their studies.
To this end, there is also the expectation that students will update their knowledge through the frequent use of libraries, newspapers, business-oriented TV programmes and the internet.
He is a senior examiner with Cambridge International and UK examination boards. He also trains teachers overseas in A-level syllabus development, teaching methods and examination skills.
He has been an examiner for Cambridge International Examinations for over 10 years as well as working for a UK examinations board. He also has experience of providing training for teachers overseas in A-level syllabus development, teaching methods and examination skills. Enterprise This chapter covers syllabus section 1AS. Dulip starts his business Dulip lives in a large country with many natural resources, such as coal and timber.
He plans to start a business growing and cutting trees to sell as timber. He wants to buy a forest from a farmer and cut down a fixed number of trees each year. As Dulip is concerned about the environment of his country, he will plant two new trees for each one he cuts down. He has been planning this business venture for some time. He has visited a bank to arrange a loan. He has contacted suppliers of saws and other equipment to check on prices.
Dulip also visited several furniture companies to see if they would be interested in buying wood from the forest. In fact, he did a great deal of planning before he was able to start his business. Dulip is prepared to take risks and will invest his own savings, as well as using the bank loan, to set up the business. He plans to employ three workers to help him to start with. If the business is a success, then he will also try to sell some of the timber abroad. He knows that timber prices are high in some foreign markets.
After several months of planning, he was able to purchase the forest. Points to think about: Why do you think Dulip decided to own and run his own business rather than work for another firm? Why was it important to Dulip that he should do so much planning before starting his business?
Do you think Dulip will make a successful entrepreneur? Give reasons for your answer. Introduction Many business managers are paid high salaries to take risks and make decisions that will influence the future success of their business. Much of this book is concerned with how these decisions are made, the information needed to make them and the techniques that can assist managers in this important task.
However, no student of Business Studies can hope to make much progress in the study of this subject unless they have a good understanding of the economic environment in which a business operates. Business activity does not take place in isolation from what is going on around it. The very structure and health of the economy will have a great impact on how successful business activity is. This first chapter explains the nature of business activity and the role of enterprise in setting up and developing businesses.
The purpose of business activity A business is any organisation that uses resources to meet the needs of customers by providing a product or service that they demand.
There are several stages in the production of finished goods. Business activity at all stages involves adding value to resources, such as raw materials and semi-finished goods, and making them more desirable to — and thus valued by — the final purchaser of them. Without business activity, we would all still be entirely dependent on the goods that we could make or grow ourselves — as some people in virtually undiscovered native communities still are.
Business activity uses the scarce resources of our planet to produce goods and services that allow us all to enjoy a very much higher standard of living than would be possible if we remained entirely selfsufficient. What do businesses do? Businesses identify the needs of consumers or other firms. They then purchase resources — or factors of production — in order to produce goods and services that satisfy these needs, usually with the aim of making a profit.
Before we go on, it will be useful. Business activity exists to produce consumer goods or services that meet the needs of customers. These goods and services can be classified in several ways. What do businesses need to produce goods and services? Factors of production These are the resources needed by business to produce goods or services.
These include capital goods, such as computers, machines, factories, offices and vehicles. It provides a managing, decision-making and coordinating role. Businesses have many other needs before they can successfully produce the goods and services demanded by customers. Figure 1. The concept of adding value added value A business adds value to the raw materials it uses to produce the good or service it sells. Added value is one of the key objectives of any business.
The concept of value added can be illustrated by an example taken from the building industry see also Figure 1. From the value added by the business, other costs have to be paid, such as labour and rent — value added is not the same as profit. However, if a business can increase its value added without increasing its costs, then profit will increase.
How could the following businesses add value to the goods they buy in: hotel car dealer clothing manufacturer fast-food restaurant? New business ventures started by entrepreneurs can be based on a totally new idea or a new way of offering a service. They can also be a new location for an existing. This requires original ideas and an ability to do things differently — this is the skill of innovation. Commitment and self-motivation It is never an easy option to set up and run your own business.
It is hard work and may take up many hours of each day. A willingness to work hard, keen ambition to succeed, energy and focus are all essential qualities of a successful entrepreneur.
Multi-skilled An entrepreneur will have to make the product or provide the service , promote it, sell it and count the money. These different business tasks require a person who has many different qualities, such as being keen to learn technical skills, able to get on with people and good at handling money and keeping accounting records.
Risk taking Entrepreneurs must be willing to take risks in order to see results. Often the risk they take is by investing their own savings in the new business. Bangalore enterprise blossoms Rama Karaturi gained the idea for his rose-growing business when he searched, without success, for a bouquet of roses for his wife in Bangalore.
The city was a rose-free zone, so he decided to start growing them himself. In , he opened two greenhouses growing just roses. He sold the flowers in India, but his business also became one of the first in India to start exporting flowers on a large scale. Rama worked long hours to make his business a success.
Source: business. Explain what is meant by this term. Major challenges faced by entrepreneurs Identifying successful business opportunities Identifying successful business opportunities is one of the most important stages in being an effective entrepreneur.
The original idea for most. Very often, these skills will enable an entrepreneur to offer them to friends and relatives and this could be the start of the business. Determining a location Perhaps the most important consideration when choosing the location for a new business is the need to minimise fixed costs.
When finance is limited, it is very important to try to keep the break-even level of output — the output level that earns enough revenue to cover all costs — as low as possible. This will greatly increase the chances of survival.
Operating from home is the most common way for entrepreneurs to establish their business. Sourcing capital finance Once the entrepreneur has decided on the business idea or opportunity, the next task is to raise the necessary capital. In an International Labour Organisation survey of new business start-ups, the problem of finance came top of the list of replies from entrepreneurs regarding the main difficulty.
The sources of financial support offered to micro business start-ups are explained in Chapter Why is obtaining finance such a major problem for entrepreneurs? New businesses that offer a consumer service need to consider location very carefully. Whereas a website designer could operate from home very effectively, as communication with customers will be by electronic means, a hairdresser may need to consider obtaining.
An alternative is to visit customers in their own homes — this way, the entrepreneur may avoid the costs of buying or renting their own premises altogether. Competition This is nearly always a problem for new enterprises unless the business idea is so unique that no other business has anything quite like it.
A newly created business will often experience competition from older, established businesses, with more resources and more market knowledge. The entrepreneur may have to offer a better customer service to overcome the cost and pricing advantages that bigger businesses can usually offer. Building a customer base This is linked to the previous point about competition. To survive, a new firm must establish itself in the market and build up customer numbers as quickly as possible.
The long-term strength of the business will depend on encouraging customers to return to purchase products. Many small businesses try to encourage this by offering a better service than their larger and betterfunded competitors.
Why do new businesses often fail? Even if an entrepreneur has all of the qualities listed above, success with a new business can never be guaranteed. In fact, many businesses fail during their first year of operation. The most common reasons for new enterprises failing are:. Lack of record keeping The lack of accurate records is a big reason for business failure.
The latter will be. Farah branches out on her own Farah was a well-qualified dressmaker. She had worked for two of the biggest dress shops in town. Farah was now determined to set up her own business.
Her first step was to investigate the prices of shop premises and she was disappointed when she found out how expensive the city-centre locations were. Her father suggested a cheaper but less busy outof-town location. Farah wondered if she could learn to keep the accounts herself if she attended classes at the local college in the evening.
She wanted to make her shop very. What she had not realised was the amount of paperwork she had to complete before her business could even start trading. Explain your answer. Justify your answer. There are many other examples that could be given to illustrate the crucial importance of keeping accurate and up-to-date records of business transactions and other matters.
With the falling cost of computing power, most businesses, even newly formed ones, keep records on computer. Lack of working capital Running short of capital to run day-to-day business affairs is the single most common reason for the failure of new businesses to survive the first year of operation.
Capital is needed for day-to-day cash, for the holding of stocks and to allow the giving of trade credit to customers, who then become debtors. Without sufficient working capital, the business may be unable to buy more stocks or pay suppliers or offer credit to important customers. All of these factors could lead to the business closing down. Keep this updated and also show it to the bank manager. Establish good relations with the bank so that short-term problems may be, at least temporarily, overcome with an overdraft extension.
Poor management skills Most entrepreneurs have had some form of work experience, but not necessarily at a management level. They may be very keen, willing to work hard and have undoubted abilities in their chosen field, e. Some learn these skills very quickly once the business is up and running, but this is quite a risky strategy.
Some organisations exist to provide support for new entrepreneurs in the form of advice and training. It is wrong to think, just because a business is new and small, that enthusiasm, a strong personality and hard work will be sufficient to ensure success. This may prove to be the case, but often it is not.
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