Business Study Material PDF

Factors of production - Lesson Title 1 Business Definition ○ A business is an organization that sells goods or services to people to make money. It can be a small shop, a restaurant, or a big company. The main goal of a business is to earn a profit while helping customers get what...

Factors of production - Lesson Title 1 Business Definition ○ A business is an organization that sells goods or services to people to make money. It can be a small shop, a restaurant, or a big company. The main goal of a business is to earn a profit while helping customers get what they need or want. Factors of Production Definition: Factors of production: is an economic term that describes the resources used to produce goods or services to make an economic profit. These resources are also called inputs. 🞇 There are FOUR factors of production. 🞇 Land 🞇 Labour 🞇 Capital 🞇 Entrepreneurship LAND What is land? 🞇 All the naturally occurring resources (gifts of nature). 🞇 Land is also called natural resources. 🞇 It includes resources found: ❖ in the air (oxygen) ❖ in the land (gold) ❖ on the land (forests) ❖ in the water (pearls from clams) 🞇 The payment for land is rent. LABOUR What is labour? 🞇 All human effort – whether mental or physical that contributes to production 🞇 Labour is also called human resources 🞇 Examples – nurses, soldiers, teachers 🞇 The payment for labour is called wages What is capital? CAPITAL What is capital? 🞇 Capital refers to all man-made resource used in the production process 🞇 Examples include machinery and equipment Entrepreneurship What is Entrepreneurship? 🞇 This is the ability to combine or organise the other factors of production and to take risks 🞇 The payment for enterprise is profit  Types of Leadership Styles Lesson 1 Importance of Leadership Engage: Leadership is very important in entrepreneurship because it guides the direction and culture of a business. Successful entrepreneurs usually have strong leadership skills, but they may use different styles based on their personal preferences, what their organization needs, and where their business is in its growth.  Explore Autocratic leadership Style : Autocratic leaders make decisions on their own, with little to no input from their team. Provide an example: (2 mins) They like to be in full control of the business and expect their employees to follow their instructions without question. Democratic Leadership Styles Democratic leaders want their team to help make decisions. Provide an example. (2 mins)  They ask their employees for ideas and work together with them. They give their team members the power to share their thoughts and make them feel involved in the business. Laissez-Faire Leadership: Laissez-faire leaders take a step back and let their team work independently. Provide an example: (2 mins) They give their team the tools and support they need but don't closely watch what their employees do each day. Management Styles Centralized Vs Decentralized  I can explain the differences between centralized and decentralized management styles. Engage : Definition: Centralized Management means that most decisions are made by top leaders in a company. These leaders control the overall direction and make rules that everyone follows. Decentralized Management means that decision-making is spread out among different managers or teams. This allows lower-level managers to make choices and act quickly based on local needs. In what type of business would centralized management be more effective? Centralized management works well in smaller businesses or places where decisions need to be made quickly. For example, fast food chains like McDonald’s use centralized management to keep everything running the same way in all locations. How can decentralized management benefit large organizations? Decentralized management helps large companies by letting different departments make their own decisions. This is useful for companies like Google, where different teams can quickly adjust to new ideas or projects without waiting for approval from the top. Explain :  I can evaluate the benefits and challenges of each style. Business Plan P.1  Engage Definition of a Business Plan : A business plan is a document that explains what a business wants to do, how it will do it, and how it will make money. It helps the owner organize their ideas, get money from investors or banks, and show others how the business will succeed. I can explain the purpose of a business plan. Explain : Strengths: Subway has the highest number of outlets compared to its competitors. As of 2023, it had over 36,000+ outlets worldwide. It’s also the third in terms of brand loyalty and is considered to be healthier than McDonald’s and KFC. What makes Subway a favorite amongst its customers is its customizable menu options catering to the diverse customer preferences and their dietary requirements. Weaknesses: Even though Subway has the highest number of outlets, it’s not the most preferred restaurant. It stands in second place while McDonald’s is first. As it follows a franchise model, the service is highly variable, and therefore customer satisfaction fluctuates. Subway restaurant themes are old and out of fashion and need to be updated. Opportunities: Subway can position itself as a healthier fast food brand by introducing healthier menu options. It can also add more variety of food instead of sticking to its iconic subs. Subway needs to improve its home delivery and drive-through services. Threats: Along with its major competitors, Subway also faces competition from new restaurants with Subway-like business models. There have been several lawsuits against it for serving stale and unhealthy food; this can tremendously affect the brand image. What is an executive summary? The Executive Summary is a brief overview of the entire business plan. It includes important information about the company and its goals. The main purpose of the Executive Summary is to summarize key points of the business.  Executive Summary Subway, started in 1965, is a popular fast-food chain known for its made-to-order sandwiches and salads. With over 40,000 locations in more than 100 countries, Subway is famous for its fresh ingredients and healthier options. Business Model/ operating procedure Subway mostly operates through franchises, meaning other people run the restaurants but pay Subway fees. This helps Subway grow quickly and adapt to different markets. Strategic Focus/ marketing plan Subway is working on improving its menu, digital services, and efficiency while also focusing on eco-friendly practices. Challenges & Opportunities/ SWOT The company faces tough competition and changing customer tastes but has chances to grow globally and use new technologies. Financial Performance/ FInancial data Subway is doing well financially and is investing in its brand and infrastructure to keep growing.Subway’s goal is to stay a top player in the fast-food industry by continuing to innovate and invest smartly. I can analyze the role of an executive summary and SWOT analysis in a business plan. Business Plan P.2 What is Financial Data? Engage : Financial data in a business plan includes important numbers like revenue (money coming in), costs (money spent), and profit (what's left after costs). This information helps people understand how healthy the business is. Define Price & Quantity Explain Price: : Definition: The amount of money customers pay for a product or service. Explanation: Price affects how many people will buy the product. For example, a fast-food chain may lower the price of a meal to attract more customers, but it still needs to make sure the price covers costs and makes a profit. Quantity: Definition: The number of products or services sold. Explanation: The quantity sold depends on the price and demand. If the price is too high, fewer people may buy it. For example, tech companies estimate how many smartphones they will sell when they launch a new model. Define Revenue & Profit Revenue: Definition: The total money a business makes from sales. Formula: Revenue = Price × Quantity Explanation: Revenue is the total income before subtracting costs. For example, if a restaurant sells 100 burgers at 20 AED each, its revenue is 2,000 AED. Profit: Definition: The money left after all costs are paid. Formula: Profit = Revenue - Costs Explanation: Profit is what the business keeps after paying for things like supplies and wages. If revenue is higher than costs, the business makes a profit.