Unit 1 : Business activity

You should be able to ... Understand the purpose and nature of business activity R A G
Understand the purpose and nature of business activity:
Concepts of needs, wants, scarcity and opportunity cost. 0 0 ###
Importance of specialisation - division of labour 0 0 ###
Purpose of business activity 0 0 ###
The concept of adding value and how added value can be increased 0 0 ###
Unit 2: Classification of businesses
Business activity in terms of primary, secondary and tertiary sectors:
Basis of business
Reasons classification,
for the changing using of
importance examples
businesstoclassification,
illustrate the classification
e.g. in developed 0 0 ###
and developing economies
Classify business enterprises between private sector and public sector in a mixed 0 0 ###
economy 0 0 ###
Unit 3: Enterprise, business growth and size
Enterprise and entrepreneurship:
Characteristics of successful entrepreneurs 0 0 ###
Contents of a business plan and how business plans assist entrepreneurs 0 0 ###
Why and how governments support business start-ups, e.g. grants, training schemes 0 0 ###
The methods
Methods and problems
of measuring of measuring
business size, e.g. business
number ofsize:
people employed, value of
output, capital employed (profit is not a method of measuring business size) 0 0 ###
Limitations of methods of measuring business size 0 0 ###
Why some businesses grow and others remain small:
Why the owners of a business may want to expand the business 0 0 ###
Different ways in which businesses can grow 0 0 ###
Problems linked to business growth and how these might be overcome 0 0 ###
Why some businesses remain small 0 0 ###
Why some
Causes (new or established)
of business businesses
failure, e.g. lack fail:
of management skills, changes in the business
environment, liquidity problems 0 0 ###
Why new businesses are at a greater risk of failing 0 0 ###
Unit 4: Types of business organisation
The main
Sole features
traders, of different
partnerships, forms
private of public
and business organisation:
limited companies, franchises and joint
ventures 0 0 ###
Differences between unincorporated businesses and limited companies 0 0 ###
Concepts of risk,
Recommend and ownership and limited
justify a suitable liability
form of business organisation to owners/ 0 0 ###
management in a given situation 0 0 ###
Business organisations in the public sector, e.g. public corporations 0 0 ###
Unit:5 Business objectives and stakeholder objectives
Businesses can have several objectives and the importance of them can change:
Need for business objectives and the importance of them 0 0 ###
Different business objectives, e.g. survival, growth, profit and market share 0 0 ###
Objectives of social enterprises 0 0 ###
The role of stakeholder groups involved in business activity:
Main internal and external stakeholder groups 0 0 ###
Objectives of different stakeholder groups 0 0 ###
How these objectives might conflict with each other, use examples 0 0 ###
Differences in the objectives of private sector and public sector enterprises 0 0 ###
Unit 6: Motivating employees
The importance of a well-motivated workforce:
Whybenefits
The people work and what motivation
of a well-motivated means
workforce: labour productivity, reduced absenteeism 0 0 ###
and labour turnover 0 0 ###
The concept of human needs, e.g. Maslow’s hierarchy 0 0 ###
Key motivational theories: Taylor and Herzberg 0 0 ###
Methods of motivation:
Financial rewards,
Non-financial e.g. wage,
methods, e.g. jobsalary, bonus, job
enrichment, commission and profit sharing
rotation, teamworking, training, 0 0 ###
opportunities for promotion 0 0 ###
Recommend and justify appropriate method(s) of motivation in given circumstances 0 0 ###

Draw, interpret and understand simple organisational charts:

Simpleand
Roles hierarchical structures:
responsibilities span of managers,
of directors, control, levels of hierarchy,
supervisors, chain
other of command
employees in an 0 0 ###
organisation and inter-relationships between them 0 0 ###
The role ofofmanagement:
Functions management, e.g. planning, organising, coordinating, commanding and
controlling 0 0 ###
Importance of delegation; trust versus control 0 0 ###
Leadership styles:
Features of the main leadership styles, e.g. autocratic, democratic and laissez-faire 0 0 ###
Recommend and justify an appropriate leadership style in given circumstances 0 0 ###
Trade unions:
What a trade union is and the effects of employees being union members 0 0 ###

Recruitment and selecting employees:

Recruitment and selection methods 0 0 ###
Difference between internal recruitment and external recruitment 0 0 ###
Main stages in recruitment and selection of employees 0 0 ###
Recommend and justify who to employ in given circumstances 0 0 ###
Benefits and limitations of part-time employees and full-time employees 0 0 ###
The importance of training and the methods of training:
Importance of training to a business and to employees 0 0 ###
Benefits and limitations of induction training, on-the-job training and off-the-job training 0 0 ###
Why reducing the size of the workforce might be necessary:
Difference between
Understand dismissal
situations in whichand redundancy
downsizing with examples
the workforce might be necessary, e.g. 0 0 ###
automation or reduced demand for products 0 0 ###
Recommend and justify which employees to make redundant in given circumstances 0 0 ###
Legal controls over employment issues and their impact on employers and employees:
Legal controls over employment contracts, unfair dismissal, discrimination, health and
safety, legal minimum wage 0 0 ###
Unit 9: Internal and external communication
Why effective communication is important and the methods used to achieve it:
Effective and
Benefits communication
limitations ofand its importance
different to business
communication methods including those based on 0 0 ###
information technology (IT) 0 0 ###
Recommend and justify which communication method to use in given circumstances 0 0 ###
Demonstrate an awareness of communication barriers:
How communication barriers arise and problems of ineffective communication 0 0 ###
How communication barriers can be reduced or removed 0 0 ###
Unit 10: Marketing, competition and the customer
The role of marketing:
Identifying customer needs 0 0 ###
Satisfying customer needs 0 0 ###
Maintaining customer loyalty 0 0 ###
Building customer relationships 0 0 ###
Market changes:
Why customer/consumer spending patterns may change 0 0 ###
Why some markets have become more competitive 0 0 ###
The importance of changing customer needs 0 0 ###
How businesses can respond to changing spending patterns and increased competitio 0 0 ###
Concepts of niche marketing and mass marketing:
Benefits and limitations of both approaches to marketing 0 0 ###
How markets
How and why can
market segmentation
be segmented, is according
e.g. undertaken:
to age, socio-economic grouping,
location, gender 0 0 ###
Potential benefits of segmentation to business 0 0 ###
Recommend and justify an appropriate method of segmentation in given circumstance 0 0 ###
Unit 11: Market research
The role of market research and methods used:
Market-orientated businesses (uses of market research information to a business) 0 0 ###
Primary research
Methods and
of primary secondary
research, e.g.research (benefits and online
postal questionnaire, limitations of each)
survey, interviews, 0 0 ###
focus groups 0 0 ###
The needofforsecondary
Methods sampling research, e.g. online, accessing government sources, paying 0 0 ###
for commercial market research reports 0 0 ###
Factors influencing the accuracy of market research data 0 0 ###
Presentation
Analyse andresearch
market use of market research
data shown results:
in the form of graphs, charts and diagrams;
draw simple conclusions from such data 0 0 ###
Unit 12: Marketing mix - Product
The costs and benefits of developing new products 0 0 ###
Brand image; impact on sales and customer loyalty 0 0 ###
The product
The role of packaging
life cycle: main stages and extension strategies; draw and interpret a 0 0 ###
product life cycle diagram 0 0 ###
How stages of the product life cycle can influence marketing decisions, e.g.
promotion and pricing decisions 0 0 ###
Unit
Pricing methods (benefits and limitations of different methods), e.g. 13:
cost Price
plus,
competitive, penetration, skimming, and promotional 0 0 ###
Recommend
demand and justify
and price an appropriate
inelastic pricing method
demand; importance of the in given circumstances
concept in pricing decisions 0 0 ###
(knowledge of the formula and calculations of PED will not be assessed) 0 0 ###
Unit 14: Place
distribution channels:
Advantages and disadvantages of different channels, e.g. use of wholesalers,
retailers or direct to consumers 0 0 ###
Recommend and justify an appropriate distribution channel in given circumstances 0 0 ###
Unit 15: Promotion
The aimsforms
Different of promotion
of promotion and how they influence sales, e.g. advertising, sales 0 0 ###
promotion 0 0 ###
The need for cost-effectiveness in spending the marketing budget on promotion 0 0 ###
Unit 16: Technology and the marketing mix
Define and explain the concept of e-commerce 0 0 ###
The opportunities and threats of e-commerce to business and consumers 0 0 ###
Use of the internet and social media networks for promotion 0 0 ###
Unit 17: Marketing Strategy
Justify marketing
Importance strategies
of different appropriate
elements to a givenmix
of the marketing situation:
in influencing consumer
decisions in given circumstances 0 0 ###
Recommend and justify an appropriate marketing strategy in given circumstances
The nature
Impact andcontrols
of legal impact ofonlegal controls
marketing related e.g.
strategy, to marketing:
misleading promotion, faulty and
dangerous goods 0 0 ###
The opportunities and problems of entering new foreign markets:
Growth potential of new markets in other countries 0 0 ###
Problemsand
Benefits of entering foreign
limitations markets,
of methods e.g. cultural
to overcome differences
such problems,and lack
e.g. of ventures,
joint knowledge 0 0 ###
licensing 0 0 ###
Problemsand
Benefits of entering foreign
limitations markets,
of methods e.g. cultural
to overcome differences
such problems,and lack
e.g. of ventures,
joint knowledge 0 0 ###
licensing 0 0 ###
Unit 18: Production of goods and services
The meaning of production:
Managing resources effectively to produce goods and services 0 0 ###
Difference
Benefits of between
increasingproduction
efficiencyand
andproductivity
how to increase it, e.g. increasing productivity by 0 0 ###
automation and technology, improved labour skills 0 0 ###
Whyconcept
The businesses holdproduction:
of lean inventorieshow to achieve it, e.g. just-in-time inventory control 0 0 ###
and Kaizen; benefits of lean production 0 0 ###
The main methods of production:
Features, benefits and limitations of job, batch and flow production 0 0 ###
Recommend
How andhas
technology justify an appropriate
changed production
production methods,method for computers
e.g. using a given situation
in design 0 0 ###
and manufacturing 0 0 ###
Unit 19: Costs, scale of production and break-even analysis
Identify and classify costs:
Classifying
Use costs
cost data usingmake
to help examples,
simplee.g. fixed, variable,
cost-based average,
decisions, e.g. tototal
stop production or 0 0 ###
continue 0 0 ###
Economics
The conceptand diseconomies
of economies of scale:
of scale with examples, e.g. purchasing, marketing,
financial, managerial, technical
The concept of diseconomies of scale with examples, e.g. poor communication, lack 0 0 ###
of commitment from employees, weak coordination 0 0 ###
Break-even analysis:
The concept of break-even 0 0 ###
Construct, complete or amend a simple break-even chart 0 0 ###
Interpret a given chart and use it to analyse a situation 0 0 ###
Calculate break-even output from given data 0 0 ###
Define, calculate and interpret the margin of safety 0 0 ###
Use break-even analysis to help make simple decisions, e.g. impact of higher price 0 0 ###
Understand the limitations of break-even analysis 0 0 ###
Unit 20: Achieving quality production
Why quality is important and how quality production might be achieved:
What quality means and why it is important for all businesses 0 0 ###
The concept of quality control and how businesses implement quality control 0 0 ###
The concept of quality assurance and how this can be implemented 0 0 ###
Unit 21: Location decisions
The main
Factors factorsto
relevant influencing thedecision
the location locationof
and relocation decisions
manufacturing of a and
businesses business:
service
businesses
Factors that a business could consider when deciding which country to locate 0 0 ###
operations in 0 0 ###
The role of legal controls on location decisions 0 0 ###
Recommend and justify an appropriate location for a business in given circumstances 0 0 ###
Unit 22: Business finance: needs and sources
The main
The need reasons
for business
why finance:
businesses need finance, e.g. start-up capital, capital for
expansion and additional working capital 0 0 ###
Understand the difference between short-term and long-term finance needs 0 0 ###
The main sources of finance:
Internal sources
Short-term and external
and long-term sources
sources withwith examples
examples, e.g. overdraft for short-term finance 0 0 ###
and debt or equity for long-term finance 0 0 ###
Importance
The of alternative
main factors sources
considered of capital,
in making e.g. micro-finance,
the financial choice, e.g.crowd-funding
size and legal form 0 0 ###
of business, amount required, length of time, existing loans 0 0 ###
Recommend and justify appropriate source(s) of finance in given circumstances 0 0 ###
Unit 23: Cash-flow forecasting and working capital
The importance of cash and of cash-flow forecasting:
Why cash is important to a business forecasting 0 0 ###
What a cash-flow forecast is, how a simple one is constructed and the importance of it 0 0 ###
Amend or complete a simple cash-flow forecast 0 0 ###
How to interpret a simple cash-flow forecast 0 0 ###
How a short-term cash-flow problem might be overcome, e.g. increasing loans,
delaying payments, asking debtors to pay more quickly 0 0 ###
Working capital: 0 0 ###
The concept and importance of working capital 0 0 ###
Unit 24: 3 Income statements
What profit is and why it is important:
How a profitof
Importance is profit
madeto private sector businesses, e.g. reward for risk-taking/ 0 0 ###
enterprise, source of finance 0 0 ###
Difference between profit and cash 0 0 ###
Income
Main statements:
features of an income statement, e.g. revenue, cost of sales, gross profit, profit
and retained profit
Use simple income statements in decision- making based on profit calculations 0 0 ###
(constructing income statements will not be assessed) 0 0 ###
Unit 25: Statement of financial position
The main elements of a statement of financial position:
The main
how classifications
a business of assets
is financing and liabilities,
its activities and whatusing examples
assets it owns, sale of inventories 0 0 ###
to raise finance (constructing statements of financial position will not be assessed) 0 0 ###

Profitability:
The concept and importance of profitability 0 0 ###
Liquidity:
The concept
How andthe
to interpret importance of liquidity of a business by calculating and analysing
financial performance 0 0 ###
profitability ratios and liquidity ratios:
Gross profit margin 0 0 ###
Profit margin 0 0 ###
Return on Capital Employed 0 0 ###
Current ratio 0 0 ###
Acid test ratio 0 0 ###
Why and how accounts are used:
Needs
How of different
users usersand
of accounts of accounts andmight
ratio results ratio analysis
use information to help make 0 0 ###
decisions, e.g. whether to lend to or invest in the business 0 0 ###
Unit 27: Economic issues
Business cycle:
Main stages
Impact of the business
on businesses cycle,ine.g.
of changes growth, boom,
employment recession,
levels, slump
inflation and Gross Domestic 0 0 ###
Product (GDP)
How government control over the economy affects business activity and how 0 0 ###
businesses may respond
Identify government economic objectives, e.g. increasing Gross Domestic Product
(GDP) 0 0 ###
Impact of changes in taxes and government spending 0 0 ###
Impact of changes in interest rates 0 0 ###
How businesses might respond to these changes 0 0 ###
Environmental concerns and ethical issues Unit
as both28: Environmental
opportunities andforethical
and constraints issues
businesses:
How business activity can impact on the environment, e.g. global warming 0 0 ###
The concept of externalities: possible external costs and external benefits of business
decisions 0 0 ###
Sustainable
How and whydevelopment; howrespond
business might business
to activity can contribute
environmental to this
pressures and opportunities, 0 0 ###
e.g. pressure groups
The role of legal controls over business activity affecting the environment, e.g. 0 0 ###
pollution controls 0 0 ###
Ethical issues a business might face: conflicts between profits and ethics 0 0 ###
How business might react and respond to ethical issues, e.g. child labour 0 0 ###
Unit 29: Business and the international economy
The importance of globalisation:
The concept of globalisation and the reasons for it 0 0 ###
Opportunities and threats of globalisation for businesses 0 0 ###
Why governments might introduce import tariffs and import quotas 0 0 ###
Reasons for the importance and growth of multinational companies (MNCs):
Benefits to
Potential a business
benefits of becoming
to a country and/ora economy
multinational andathe
where MNCimpact on its stakeholders
is located, e.g. jobs, 0 0 ###
exports, increased choice, investment
Potential drawbacks to a country and/or economy where a MNC is located, e.g. 0 0 ###
reduced sales of local businesses, repatriation of profits 0 0 ###
The impact of exchange rate changes:
Depreciation
products, e.g.and appreciation
prices, of an exchange
competitiveness, rate(exchange rate calculations will not
profitability 0 0 ###
be assessed 0 0 ###
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