business paper 2

• production : job , batch , flow
• job production : products that are made individually. high quality but can be expensive and time consuming
• batch production : one type of product is made and then swapped. cheaper than job production and can be varied to meet demands but machines need resetting so can be expensive
• flow production : continuous production of one type of product. large quantities can be made and very cheap and quick but can be poor quality and repetitive task decreases employee retention
• technology is used in business by robotics, computers and automation
• automation : machinery is controlled by a person not a computer
• robotics : the use of robots in the production process
• advantages of technology in production : machines replace workers which reduces costs, computers help workers work more efficiently, waste is reduced because machine same more accurate than humans
• disadvantages of using technology in production : workers lose there jobs, expensive to buy machines and workers may need to be retrained to work with machinery
• providing good quality service means waste is reduced and the business gains a good reputation
• quality control advantages : stops poor quality products being sold, production can continue while inspection takes place and producing high quality goods saves reputation of business
• quality control disadvantages : does not prevent waste, inspection can be costly
• advantages of quality assurance : reduces wastage and cost, all workers are responsible for quality which motivates workers to take care and promotes good reputation of business
• disadvantages of quality assurance : workers may be stressed by the responsibility of having to check the quality of their own work
• face to face selling : customers can argue over prices , owners can help with assistance and advice however can be hard to access and business can lose profits due to bargaining
• telesales : customers can easily ask questions and can cost less than owning a shop but not everyone has a phone and can be mistaken for scam calls
• e-commerce : the bringing together of buying and selling electronically
• influences of e-commerce : levels of employment has been reduced because of machines, business have to employee workers with relevant skills like graphic designers, business that sell online can locate in cheaper warehouses
• e-commerce : can sell 24/7 , costs are lower selling online and web designers can make business look appealing at little cost however competition has increased , delivery systems need to be organised and e-commerce must provide cyber security for themselves and their customers
• all products must of satisfactory quality, fit for purpose and as described
• location is affected by : cost , proximity to market , proximity to labour , labour to materials and goverment
• role of procurement : identifying goods , choosing suppliers , ordering goods , receiving deliveries
• impacts on supply decisions : time , reliability , length of the supply chain , cost and customer service
• roles of the finance function : calculating sales and production costs , calculating profit and loss , forecasting cash flow , managing payments , calculating break even , calculating the average rate return
• a business needs finance : setting up a new business , funding expansion , recruitment , marketing , running the business
• owners capital : the owners savings are invested
• retrained profit : money not distributed to the owners as profit
• sale of assets : goods owned by the business are sold to raise money
• overdraft : a bank makes available to a business more money than it has in its account
• trade credit : a business sells goods after agreeing to pay for them at a later date
• taking on a new partner : the new partner invests some of their savings in the business
• loan : a set amount of money borrowed for a set period of time
• share issue : new shares are sold to raise more money
• crowdfunding : money donated or invested by sponsors or people invest become part owners of the business
• total variable cost = number of workers x wage paid to each worker
• total cost = total fixed cost + total variable cost
• gross profit = sales - cost of sales
• net profit = gross profit - expenses
• gross profit margin = gross profit x 100 / total revenue
• net profit margin = net profit x 100 / total revenue