Summary

Summary All business studies chapters summarised for grade 11.

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Course
Business Studies

Institution
11th Grade

Chapters include the following: - Business environment - CSR - Management and Entrepreneurship - Research and presenting data and information - Forms of ownership - Public Relations - Finance function - Risk management - Marketing Function - Creative thinking and problem solving - Profes...

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Uploaded on October 31, 2024
Number of pages 42
Written in 2024/2025
Type Summary

summaries

Institution 11th Grade
Course Business Studies
Schooljaar 201

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BUSINESS ENVIRONMENT

 Micro=inner
 Market=just outside
 Macro=outer

DEFINITION OF ENVIRONMENTAL SCANNING

 Process of obtaining information about possible events that may have an impact on the performance
of the business
 To ensure that business is ready for development in internal environment

PURPOSE OF ENVIRONMENTAL SCANNING

 Identify challenges and opportunities
 Quick and unexpected change- crisis because business didn’t expect it and won’t have plan to deal
with it
 Changes that occur over period can be identified as trends and business will be forewarned to adapt
 Management must use information gained to develop strategies that will assist business to respond
quickly to crisis and opportunities

WHERE DOES ENVIRONMENTAL SCANNING FIT INTO THE STRATEGY?

 Management must consider where the business wants to go and then formulate a strategy that will
get them there

SWOT ANALYSIS

 Business has control over strengths and weaknesses
 Business doesn’t have control over opportunities and threats

STRENGTHS

 Adds value to performance of business
 Business should develop strategies which enables it to use its strengths to overcome weaknesses

EXAMPLES OF POSSIBLE STRENGTHS

 Competitive price
 Location
 Patents: unique product can be offered to target market
 Product differentiations: creates competitive advantages
 Skilled workforce
 Business culture: the way things are done
 Good marketing and a strong brand
 Access to financing and other resources
 Operational efficiency and good quality are synonymous

,FACTORS TO CONSIDER WHEN CHOOSING LOCATION OF BUSINESS

 Must fit in with neighbourhood
 Complementary in proximity
 Easy access to business
 Security
 Find out about future developments in area
 Consider trading hours
 Consider surrounding business that may be direct competitor

WEAKNESSES

 Strengths can be weaknesses if not managed properly
 Business needs to put necessary strategies in place to overcome any weaknesses

OPPORTUNITIES AND THREATS

 Opportunities presents business with chance to outperform competitors
 Threats could hamper success of business

TOWS-ANALYSIS

SO - thinking about how business could use strengths for opportunities

ST - assessing how strengths could eliminate threats

WO - created by business overcoming weaknesses to take advantage of opportunities

WT - assess how business could avoid threats by reducing/eliminating weaknesses

PORTER’S SIX FORCE ANALYSIS

 Can be used to asses attractiveness of market
 Market is attractive if it has potential high profits

ATTRACTIVE MARKET UNNATRACTIVE MARKET

-high entry barriers -low entry barriers

-low level competition -high level competition

-weak supply bargaining power -strong supply bargaining power

SIX FORCES THAT NEED TO BE CONSIDERED IN MARKET ENVIRONMENT

THREAT OF NEW ENTRANTS TO MARKET

 Assesses how easy/different it is for new competitor to enter current market
 Vital for existing businesses to create high entry-level barriers

BARRIERS THAT WILL MAKE IT DIFFICULT TO ENTER THE MARKET:

 High level of customer loyalty
 Existing business has strong trade markets
 Capital needed is high

,RIVALRY AMONGST EXISTING COMPETITORS

 Number of competitors is important factor
 Businesses would have to compete aggressively to gain and attain its market share

RIVALRY AMONGST EXISTING COMPETITORS IS USUALLY HIGH WHEN:

 Many competitors in market
 Competitors are of equal size
 Low level of customer loyalty

THREAT OF SUBSTITUTES

 Business may feel threatened when buyer is easily able to find substitute product @ better price

BARGAINING POWER OF SUPPLIER

 When high, it allows supplier to sell products for higher prices

SUPPLIERS HAVE STRONG BARGAINING POWER WHEN:

 Few suppliers in market
 Limited options to substitute raw materials

BARGAINING POWER OF BUYER

 Can demand lower prices/ higher quality
 Satisfying more consumer demands- lower profits

BUYER HAS STRONG BARGAINING POWER WHEN:

 They buy in bulk
 Only few buyers exist
 Many suppliers sell the same product

COMPLEMENTARY PRODUCTS

 Look at potential within market to increase demand for original product by introducing a
complementary product
 Example-> apple created iTunes to complement the iPod

PESTLE ANALYSIS

 Used to help business understand the macro environment
 Helps align business to forces of change that could affect the business

POLITICAL ENVIRONMENT

 Influence of government policies, political stability, and regulations on an organization’s operations.
 tax policies, trade restrictions, employment laws

ECONOMIC ENVIRONMENT

 Impact consumers spending habits and overall financial health of organizations.
 rates, exchange rates, economic growth and unemployment rates.

, SOCIAL ENVIRONMENT

 Involves cultural trends, demographics, lifestyle change, and consumer attitudes that can affect an
organization.
 population growth, age distribution, and social attitudes towards certain products.

TECHNOLOGICAL ENVIRONMENT

 Advancements in technology, innovation and automation that can impact an organization’s industry.
 research and development, digitalization, and technological disruptions.

LEGAL ENVIRONMENT

 Laws, regulations and legal frameworks that can impact how an organisation operates.
 labour laws, consumer protection laws, and industry-specific regulations.

ENVIRONMENTAL

 refers to sustainability, climate change, and environmental concerns that can impact an
organization’s operations.
 eco-friendly practices, waste management and carbon emissions regulations.

CORPORATE SOCIAL RESPONSIBILITY

CSR IN BUSINESS CONTEXT

 Relationship between business and society and the degree to which the business impacts the society
 If policies are on paper but not implemented, it means that the business is well-intentioned
 They place pressure on business and demands that business acts in their best interest

CSR ISSUES

- Poor housing - Crime - Lack of education
- Poor health services - Poverty - Unemployment
- Environmental services - Inequality

QUESTIONS THE BUSINESS NEEDS TO ANSWER

1. What’s the business’ level of responsibility to address the issue
2. To whom will business be responsible
3. How long will business be responsible
4. How will responsibility affect business
5. What’s the responsibility of each stakeholder

TWO LEVELS OF RESPONSIBILITY

 Primary responsibility: business obligation to look after the interest of stakeholders which are
directly affected by success of business
 Secondary responsibility: towards stakeholders who are indirectly affected by the business’ activities

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