Business activity

• Define entreprise

  Seeing an opportunity and taking the risk to provide a product or service
• What is a sole trader

  A business that only has one owner
• some characteristics of an entrepreneur are creativity, confidence, determination, risk-taker
• what is a business plan?

  a simple plan which sets out details of the product or service being sold and how it will be financed and marketed.
• in a business plan there should be the idea of the business, the people involved, market research, finance and the competitors.
• there should be between 2 and 20 partners in a partnership.
• unlimited liability is when the owner of the business is responsible for repaying all the debts of a business.
• limited liability is when the owners of a business can only lose the money they have invested in a business if it fails
• public limited company has a very high financial risk and needs a large amount of finance.
• private limited company's have owners who wish to keep control of the business
• the disadvantages of being a sole trader are that you will not receive any sick pay or holiday pay and you may struggle with cash flow as you do not have access to loans from banks.
• the advantages of being a sole trader are that you get to make your own decisions about how to run the business and you don't need to pay tax on profits until the end of the year.
• a partnership is where two or more people work together to start up a new business, sharing responsibility for running it.
• some business objectives are survival, profit, growth.
• There are two internal stakeholders. what are they?

  owners and employees
• There are four external stakeholders. What are they?

  customers, suppliers, government and local community.
• define organic growth

  when a business internally increases sales
• what is external growth?

  the growth of a business by a takeover or merger.
• define horizonal growth

  when two businesses are involved in similar operations have a takeover or merger.
• define diversification

  when a business merges or takes overs another business with no connection
• Backwards vertical growth is when a business buys out the supplier
• forward vertical growth is when a business takes over or merges with a business that it supplies goods to.