exam term 2 business test paper 1

• Components of the micro-environment

  • Structure
  • Management
  • Resources
  • 8 business functions
  • Culture
  • Goals
• Management

  Style/type of leadership/management
• Structure

  Defines how the leadership of the business will be structured
• Resources

  • Human resources (people)
  • Physical resources (machinery)
  • Financial resources
  • Time
• Culture

  The way a business conducts business
• 8 Business functions

  • Management
  • Purchasing
  • Production
  • Marketing
  • Public relations
  • Human resources
  • Administration
  • Finance
• Market environment components

  • Regulators
  • Competitors
  • Suppliers
  • Customers
  • Intermediaries
  • Unions
• Regulators

  Put in place by the government to regulate or control certain industries
• Intermediaries

  Include all the people and businesses that link the micro-environment to the market-environment such as agents, retailers and wholesalers
• Unions

  Represent labor force and to protect their interests
• Macro-environment components

  • Economic
  • Technological
  • Political
  • Physical/natural
  • Global
  • Social/cultural/demographic
  • Institutional
• Challenges in the micro-environment

  • Difficult employees
  • Lack of vision and mission
  • Lack of adequate management skills
  • Unions
  • Strikes/go slows
• Challenges in the market-environment

  • Competition
  • Shortage of supply
  • Change in consumer behavior
  • Demographic/psychographics
  • Socio-cultural factors
• Challenges in the macro-environment

  • Changes in income levels
  • Political changes
  • Contemporary legislation
  • Labour restrictions
  • Micro-lending
  • Globalization/international challenges
  • Social values and demographics
  • Socio-economic issues
  • Socio-economis challenges
• Impact of contemporary socio-economic issues

  • Income
  • Inflation
  • Economic crime
  • Ethical misconduct
  • Sexual harassment
  • Illiteracy
  • Social/cultural/demographic issues
  • Corruption and the mismanagement of funds
  • Dumping
  • Piracy
  • Population growth
  • Lack of skills
  • Unavailability of natural resources
  • Inefficiency in the use of resources
  • Exhaustion of natural resources
  • Strikes
• marketing

  the process of conceiving,pricing,promoting and distributing products for sale to consumers.
• grading

  when a rating/label is given to products to show what quality they are.
• demographics

  issues relating to a group of individuals such as race, age, social/economic class.
• patent

  an exclusive right granted to an inventor for limited period of time.
• backward link

  businesses in a sector buys goods/services from another sector or from businesses within the same sector.
• interest rate

  the percentage of borrowed money that the borrower has to pay back to the commercial bank.
• storage

  is the safe-keeping of products until they are sold
• premium pricing

  is when a business charges a high price for a unique product for which there is little competition.
• e-marketing

  the marketing of products over the internet or other electronic networks.
• psychographics

  peoples attitudes, tastes and desires of the market.
• difficult employees

  may lack skills or be unproductive.
• economic crime

  this includes identity theft, credit card fraud, bank fraud and money laundering.
• ethical misconduct

  this includes sexual harassment, corruption and the mismanagment of funds.
• dumping

  when companies are unable to sell products in their own country they sell the products in other countries below the normal asking price.
• piracy

  is the unauthorised use or reproduction of anothers personal work such as music and movie industry.
• copyright

  is the exclusive legal right given to a creator of an original work.
• forward link

  when an enterprise sells its goods and services to the same sector or other businesses in other sectors.
• enterprise

  a company, firm or business.
• interdependent

  two businesses, industries or sectors that rely on each other to achieve their best outputs.
• interrelated

  two or more businesses, industries or sectors that are connected.
• embargo

  a legal barrier that restricts imports from that country.
• secondary costs

  costs that are linked to the actual production of the goods/services.
• exchange control

  government imposed limitations on the purchase and sale of currencies.
• primary costs

  material expenses, salaries, asset depreciation and energy.
• porters five forces

  threat of new entries, threats of substitution, rivalry, supplier power and buyer power.