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Introduction To Business and Its Structure Tutorial - U1 - 1

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42 views4 pages

Introduction To Business and Its Structure Tutorial - U1 - 1

1385-1634873086765-Tutorial_U1_1

Uploaded by

jay
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Course: Diploma in Business Management

Module Code: Unit_01


Module: Introduction to business and its structure

1. Name five different levels of businesses


a. Local Business
b. Regional Business
c. National
d. International
e. Global

2. Name five tangible and intangible aspects required to start a business.


a. Finance
b. Labor
c. Customers
d. Suppliers
e. Management organization & structure

3. In the context of business, it is important to define your objectives further using


“SMART” criteria. Name each element that “SMART” stands for.
a. S - Specific
b. M - Measurable
c. A - Attainable
d. R - Relevant
e. T – Time-bound

4. Name five internal and external factors affecting businesses.


Internal External
1. Employee mix 1. The government
2. Capabilities 2. The economic climate
3. Resources 3. World events
4. Stakeholder goals 4. Technology
5. Corporate culture 5. The public

5. What is the difference between macro and microenvironment?


While macro-environments have no direct impact on businesses, microenvironments are those
forces that the firm directly interacts with. While the microenvironment has a direct impact on
the firm, the macro-environment has an indirect impact.
6. Write three major differences between a sole trade and a partnership.
a. No formal procedure is needed for a sole trader whereas a deed of partnership needs to be
drawn out in case of a partnership.
b. Partnership spreads the risk to all the people involved whereas a sole trader must shoulder all
costs and risks.
c. More capital is raised through partnership whereas sole trader can only use the start up capital
and their own funds/loans.
7. What is the difference between a vision statement and a mission statement?
A mission statement often outlines the organization's current activities, whereas a vision
statement essentially outlines the organization's ultimate objectives.
8. List down three advantages of being a partnership when compared to a sole trade.
a. Spreads the risk across all partners.
b. Partners bring in more capital to the business.
c. Increased Capabilities and skills.

9. What is a deed of partnership? Name three major elements mentioned in a deed of


partnership.
A deed of partnership is a contract between business partners. The nature of the partnership, the
partners' responsibilities and rights, their liabilities, and the proportion by which profits and
losses will be divided are all defined in this agreement.
a. The amount of capital each partner should provide.
b. Rules on how to take on new partners.
c. How the partnership is brought to an end, or how a partner leaves.

10. What is meant by “unlimited liability”? Name two unlimited liability business types.
Unlimited Liability means that each business owner is equally liable for any debt incurred by the
company, and that their personal assets could legitimately be seized to satisfy the outstanding
amount, whether the company is unable to pay the obligation or defaults on it.
a. Partnership
b. Sole Trader
11. List down three advantages of “limited liability” companies compared to a sole trade.
a. As a separate legal entity, the company shields its owners from being held personally
accountable for commercial debts.
b. Limited companies allow much greater flexibility to the management.
c. Tax Efficiency
12. Name two advantages and disadvantages of being a franchisor.

Advantages Disadvantages
1. Large companies see it as a means of rapid 1. Costs may be higher than you expect
expansion with the franchisee
Providing most of the finance. 2. Although franchising is a relatively
inexpensive method of growth, it is not free.
2. If the franchise model works, then there are
large profits to make from selling
franchises, royalty payments, selling raw
materials and equipment

13. Name two advantages and disadvantages of being a franchisee.


Advantages Disadvantages
1. Less investment is required at the start-up 1. Cost to buy franchise – can be very
stage since the franchise business idea expensive.
has already been developed
2. Have to follow the franchise model, so less
2. A franchise allows people to start and run flexible. You would probably be told what
their own business with less risk. The prices to set,
chance of failure among new franchises is what advertising to use and what type of staff
lower as their product is a proven to employ.
success and has a secure place in the market

14. Name five ways of measuring the growth of a business.


a. Sales Turnover
b. No. od employees
c. Share Capital
d. Market Share
e. No. of outlets
15. What is the difference between a merger and an acquisition?
When two independent organizations join forces to form a single, new organization, a merger
takes place. An acquisition, on the other hand, is the taking over of one entity by another.
16. Name two ways of protecting a business idea or a product.
a. Patents
b. Copyrights

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