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Financial business objectives: survival, profit, sales, market share, financial securityNon-financial business objectives: social aims, satisfaction, challenge, independence, controlWhy business objectives change as a business evolvesSole traders: key features, pros and consPartnerships: key features, pros and consPrivate limited companies: key features, pros and consPublic limited companies: key features, pros and consPublic corporations: reasons for and against public ownershipRisk, ownership and limited liability: what they mean in practiceOwnership vs control in different business formsStakeholders and shareholders: who they are and why they matterChoosing the most appropriate form of ownership for a business scenarioFranchises: what they are and why firms use themSocial enterprises: purpose and how they operateMultinationals: what they are and why firms become multinationalsPrimary sector: what it is, typical businesses and examplesSecondary sector: what it is, typical businesses and examplesTertiary sector: what it is, typical businesses and examplesLocation factors: proximity to market, labour, materials and competitorsLocation decisions and relocation: how business activity affects the decisionImpact of the internet on location: e-commerce vs fixed premisesLocation and the external environment: legal controls and trade blocsGlobalisation: what it is and why it happensGlobalisation: opportunities and threats for businessesMultinationals: benefits to the businessMultinationals: benefits to a host country/economyMultinationals: possible drawbacks to a host country/economyExchange rates: calculating exchange rates (worked method)Exchange rates: impact on international competitivenessExchange rates: impact on importers and exportersGovernment spending: why governments spend and limits on spendingHow government affects business activity: infrastructure provisionHow government affects business activity: legislationTrade policy: trading blocs and tariffsInterest rates: effects on businessesInterest rates: effects on consumer spendingExternal factors: social influences on business decisionsExternal factors: technological influences on business decisionsExternal factors: environmental influences on business decisionsExternal factors: political influences on business decisionsMeasuring business success: revenueMeasuring business success: market shareMeasuring business success: customer satisfactionMeasuring business success: profitMeasuring business success: growthMeasuring business success: owner/shareholder satisfactionMeasuring business success: employee satisfactionReasons for business failure: cash flow problems and lack of financeReasons for business failure: not competitiveReasons for business failure: failure to adapt to market changes
Why effective communication matters in businessInternal communication: purposes and examplesExternal communication: purposes and examplesCommunication methods (including IT): choosing the right methodBenefits and limitations of different communication methodsHow communication barriers ariseProblems caused by ineffective communicationHow to remove communication barriersTypes of employment: full-time and part-timeTypes of employment: flexitime and zero-hours contractsTypes of employment: job shareTypes of employment: casual, seasonal and temporaryRecruitment documents: job descriptionRecruitment documents: person specificationRecruitment documents: application formRecruitment documents: CV/résuméInternal recruitment: advantages and disadvantagesExternal recruitment: advantages and disadvantagesRecruitment process: job advertisementRecruitment process: shortlistingRecruitment process: interviewingLegal controls: equal opportunities (protected characteristics)Legal controls: minimum wage laws and their effectsWhy training matters for the business and for workersInduction training: purpose and examplesOn-the-job training: purpose, benefits and limitationsOff-the-job training: purpose, benefits and limitationsTraining and compliance with health and safety lawsMotivation: why it matters (attracting, retaining, productivity)Taylor’s view of motivation (scientific management)Maslow’s hierarchy of needs (workplace application)Herzberg’s two-factor theory (workplace application)Financial motivation: remunerationFinancial motivation: bonus and commissionFinancial motivation: promotion and fringe benefitsNon-financial motivation: job rotation and job enrichmentNon-financial motivation: autonomyOrganisational structures: hierarchical vs flatOrganisational structures: centralised vs decentralisedSpan of control: what it is and why it mattersChain of command: what it is and why it mattersDelegation: what it is and when it works wellFunctional areas: human resources (what HR does)Functional areas: finance (what the finance function does)Functional areas: marketing (what the marketing function does)Functional areas: production/operations (what operations does)
Why businesses need finance: short-term needsWhy businesses need finance: long-term needsFinance for start-up vs finance for expansionInternal finance: personal savingsInternal finance: retained profitInternal finance: selling assetsExternal finance: overdrafts and trade payablesExternal finance: loans (loan capital)External finance: share capital and stock market flotationExternal finance: venture capitalExternal finance: crowdfundingWhy cash is vital: paying suppliers, overheads and employeesCash vs profit: spotting the difference in exam questionsCash-flow forecasts: cash inflowsCash-flow forecasts: cash outflowsCash-flow forecasts: net cash flowCash-flow forecasts: opening and closing balancesInterpreting a cash-flow forecast to identify problems and solutionsRevenue: what it is and how to calculate itFixed costs vs variable costs (with business examples)Total costs: how to calculate and interpretProfit and loss: calculating profit and understanding lossesBreak-even: what it means for a businessBreak-even output: calculating using a formulaBreak-even output: finding it from a break-even diagramInterpreting break-even charts: margin of safety and profit/loss areasBreak-even changes: impact of changing revenueBreak-even changes: impact of changing costsLimitations of break-even charts: why results aren’t always reliableStatement of comprehensive income: what it is used forIncome statement features: sales, cost of sales and gross profitIncome statement features: expenses and operating profitUsing an income statement for decision making (no construction)Profit: what it is, why it matters, and how it differs from revenueStatement of financial position: what it is used forBalance sheet features: current and non-current assetsBalance sheet features: current and non-current liabilitiesCapital employed: what it representsInterpreting a statement of financial position (no construction)Gross profit margin: calculating and interpretingOperating profit margin: calculating and interpretingMarkup: calculating and interpretingROCE: calculating and interpretingCurrent ratio: calculating and interpretingAcid test ratio: calculating and interpretingLiquidity: what it means and why it mattersComparing ratios over time and against other businessesUsing financial documents to assess performance and make decisions
Why businesses do market research: needs, gaps, risk reduction, decisionsPrimary research: surveysPrimary research: questionnairesPrimary research: focus groupsPrimary research: observationPrimary research: test marketingSecondary research: internet sources (benefits and risks)Secondary research: market reportsSecondary research: government reportsQualitative vs quantitative data in market researchUsing social media to collect market research dataReliability of market research data: bias, sample size, outdated dataWhy marketing matters: satisfying customer needsBuilding customer relationships and customer loyaltyMarket orientation vs product orientationMarket share: meaning and basic analysisNiche marketing vs mass marketingResponding to changing customer needsResponding to changing customer/consumer spending patternsResponding to increased competitionMarket segmentation: why businesses segment marketsSegmenting by location: geographic segmentationSegmenting by demographicsSegmenting by lifestyle: psychographic segmentationSegmenting by incomeSegmenting by ageTargeting: choosing a segment and justifying the choiceProduct: developing a new product or serviceGoods vs services: key differences for marketing decisionsPackaging: why it matters (protection, branding, information)Product life cycle: the main stagesProduct life cycle: extension strategies (how firms extend sales)Managing a product portfolio: Boston Matrix basicsPrice: cost-plus pricingPrice: penetration pricingPrice: competition pricingPrice: price skimmingPrice: promotional pricingPlace: distribution channels and choosing methods of distributionRetailers as a distribution channelE-tailers and e-commerce as a distribution channelPromotion strategies: advertisingPromotion strategies: sponsorshipPromotion strategies: product trials and special offersPromotion strategies: branding as promotionAbove-the-line vs below-the-line promotionPublic relations: improving company image and brandTechnology in promotion: targeted online advertisingTechnology in promotion: viral advertising via social mediaTechnology in promotion: e-newslettersBrands: why branding is valuable to a business
Economies of scale: what they are and why average costs fallInternal economies of scale: examples (purchasing, technical, managerial, financial)External economies of scale: what they are and examplesDiseconomies of scale: what they are and why growth can create problemsLimits of growth: when bigger stops being betterProduction methods: job productionProduction methods: batch productionProduction methods: flow productionLabour-intensive vs capital-intensive production: how to tell the differenceChoosing a production method: impact on cost, quality and flexibilityProductivity: what it is and how to calculate itProductivity improvements: how higher productivity affects a businessLean production: what it is and why it mattersJust-in-time (JIT): how it works and risksKaizen: continuous improvement in practiceUsing resources effectively: reducing waste and improving efficiencyTechnology in production: robotics and automationBalancing cost, productivity, quality and flexibility in operations decisionsFactors of production: enterprise (role of the entrepreneur)Factors of production: land, labour and capital (roles and examples)Changing relationships between enterprise, capital, land and labourQuality: what “quality” means for goods and servicesQuality control: how it works and when it’s usedTotal quality management (TQM): whole-business approach to qualityQuality and competitive advantage: why quality can help win customers
What Paper 1 tests: investigating small businesses (using context)What Paper 2 tests: investigating large businesses (using context)Using data and information sources to support analysis and judgementCommand words: calculate, analyse, discuss, evaluate (what each needs)Building strong evaluation: balanced arguments and justified decisionFull marks on calculations: show workings, state units, clear answers
