FOCUS:

1.1 The purpose and nature of businesses

c Reasons for starting a business
c Factors of production – land, labour, capital, enterprise
c Entrepreneurs
c Opportunity cost
c Sectors of industry (primary, secondary, tertiary)
c Functions of business (Production, marketing, human resources, marketing)
c Dynamic nature of business (changes in legislation, environment, social,
technology)
1.2 Business ownership
c Definitions, advantages, disadvantages of:
c Sole traders, partnerships, private and public limited companies, not-for-
profit
1.3 Setting business aims and objectives
c Definitions aims & objectives
c Purpose of setting objectives
c Typical objectives (Profit, survival, growth, providing a good service, being
ethical)
c Changing objectives
Business in the real world

c Using objectives to measure success

1.4 Stakeholders
Chapter 1:

c Examples of stakeholders and why they have interest in the business

c How stakeholders can influence a business
1.5 Business location
c Why is location important? (costs, sales, image)
c Factors influencing location (type of business, proximity to market,
competitors, availability of raw materials, availability and cost of labour,
transport links, technology, costs)
c Overseas location – advantages & disadvantages
1.6 Business planning
c Purposes (help set up successfully, raise finance)
c Problems (uncertainty, lack of experience, change)
c Reducing the risk of business planning (research thoroughly, talk to experts
and consultants, regularly review and update plan)
c Main sections (background, market analysis, target market, objectives,
pricing and expected sales, competition, finances)
c What is included in the financial section (projected revenue and total costs –
fixed and variable)
1.7 Expanding a business
c Internal (organic) – Franchising, new stores, e-commerce, outsourcing
c External (integration) – Merger, takeover, types of integration (horizontal,
vertical – backwards or forwards), conglomerate)
c Measuring the size of a business
c Economies and diseconomies of scale
c Expanding abroad