1.1 Meeting Customer Needs

• Market: A place where buyers and sellers meet to trade goods and services, physically or virtually.
• Mass Market: A large market with products aimed at the general population.
• Niche Market: A smaller, specialized segment of a market catering to a specific group of customers.
• Market Size: The total sales volume or value of a particular market.
• Market Share: The percentage of total market sales held by one firm or product.
  • Formula: (Firm’s Sales / Total Market Sales) × 100
• Branding: Creating a unique name, design, or symbol that differentiates a product from competitors.
• Dynamic Markets: Markets that are constantly changing due to factors like technology, trends, and consumer preferences.
• Innovation: The process of transforming ideas into new or improved products or services.
• Risk: The potential for loss or failure when making a business decision.
• Uncertainty: The inability to predict future events or market changes.

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1.2 Market Research

• Market Research: The process of gathering, analyzing, and interpreting information about a market.
• Primary Research: First-hand data collected specifically for a research purpose, e.g., surveys and interviews.
• Secondary Research: Pre-existing data collected for another purpose, e.g., government reports and market analysis.
• Quantitative Research: Data collection focused on numbers, statistics, and measurable information.
• Qualitative Research: Data collection focused on understanding customer opinions, attitudes, and motivations.
• Sampling: Selecting a group of respondents to represent the target population.
• Bias: When research results are influenced by external or personal factors, making them unreliable.
• Market Segmentation: Dividing a market into distinct groups with similar needs or characteristics.

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1.3 Market Positioning

• Market Mapping: A visual representation of how products or brands are positioned in a market based on key factors.
• Competitive Advantage: A feature or benefit of a product or service that gives it superiority over competitors.
• Differentiation: Making a product or service distinct from competitors in the market.
• Added Value: The extra value created for a product above its raw material cost, achieved through branding, design, or quality.

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1.4 Demand and Supply

• Demand: The quantity of a product or service consumers are willing and able to buy at a given price.
• Supply: The quantity of a product or service producers are willing to sell at a given price.
• Equilibrium Price: The price at which supply equals demand in a market.
• Price Elasticity of Demand (PED): Measures the responsiveness of demand to changes in price.
  • Formula: % Change in Quantity Demanded / % Change in Price
  • Elastic (>1), Inelastic (<1)
• Income Elasticity of Demand (YED): Measures the responsiveness of demand to changes in income.
  • Formula: % Change in Quantity Demanded / % Change in Income
  • Normal Goods (positive), Inferior Goods (negative).

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1.5 Marketing Mix and Strategy

• Marketing Mix (4 Ps): Product, Price, Place, Promotion – the tools businesses use to market products.
• Product Differentiation: Features that make a product stand out from competitors.
• Pricing Strategies:
  • Penetration Pricing: Setting a low price to gain market share quickly.
  • Skimming Pricing: Setting a high price initially and lowering it over time.
  • Competitive Pricing: Setting prices based on competitors’ prices.
• Promotion: Methods used to inform, persuade, and remind customers about products.
• Place: How products are distributed and delivered to customers.
• Product Life Cycle: Stages a product goes through from introduction to decline (Introduction, Growth, Maturity, Decline).
• Boston Matrix: A tool for analyzing product portfolios (Stars, Question Marks, Cash Cows, Dogs).

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1.6 Entrepreneurs and Leaders

• Entrepreneur: An individual who creates and develops a business, taking risks for potential reward.
• Intrapreneur: An employee who innovates and takes risks within an organization.
• Business Objectives: Specific goals a business aims to achieve, e.g., profit maximization, survival, or growth.
• Leadership Styles:
  • Autocratic: Centralized decision-making.
  • Democratic: Encouraging employee input in decision-making.
  • Laissez-Faire: Minimal managerial intervention.
• Opportunity Cost: The next best alternative foregone when making a decision.
• Profit Maximization: Achieving the highest possible profit.
• Stakeholders: Individuals or groups affected by or with an interest in a business's activities (e.g., customers, employees, suppliers).

2.1 Raising Finance

• Internal Finance: Funds raised from within the business, such as retained profit or sale of assets.
• External Finance: Funds raised from outside the business, such as loans, share capital, or venture capital.
• Owner's Capital: Money invested into the business by the owner from personal savings.
• Retained Profit: Profit reinvested into the business rather than distributed to shareholders or owners.
• Sale of Assets: Selling business-owned assets to raise finance.
• Overdraft: A short-term borrowing facility allowing businesses to withdraw more than is in their bank account.
• Loan: A sum of money borrowed from a lender to be repaid with interest over time.
• Share Capital: Money raised by selling shares of the company to investors.
• Venture Capital: Investment from individuals or firms in exchange for a share of the business.
• Crowdfunding: Raising finance from a large number of people who contribute small amounts.
• Trade Credit: An arrangement where a supplier allows a business to delay payment for goods or services.

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2.2 Financial Planning

• Sales Forecasting: Estimating future sales revenue based on market analysis and past data.
• Contribution per Unit: Selling price per unit minus variable cost per unit.
• Break-Even Point: The level of output where total revenue equals total costs (no profit, no loss).
• Margin of Safety: The difference between the actual output and the break-even level of output.
• Cash Flow Forecast: A prediction of the inflows and outflows of cash over a given period.
• Net Cash Flow: The difference between cash inflows and outflows in a given period.
• Opening Balance: The amount of cash available at the start of a period.
• Closing Balance: The amount of cash available at the end of a period (calculated as opening balance + net cash flow).

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2.3 Managing Finance

• Gross Profit: Sales revenue minus the cost of sales.
• Operating Profit: Gross profit minus operating expenses.
• Net Profit: Operating profit minus interest and taxes.
• Profit Margins: Ratios that measure the profitability of a business (e.g., gross, operating, and net profit margins).
• Statement of Comprehensive Income: A financial document showing a business's financial performance over a period (e.g., revenues, costs, and profits).
• Liquidity: The ability of a business to meet its short-term financial obligations.
• Current Ratio: A measure of liquidity calculated as current assets divided by current liabilities.
• Acid Test Ratio: A stricter measure of liquidity excluding inventory (calculated as current assets minus inventory, divided by current liabilities).

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2.4 Resource Management

• Job Production: Producing one-off, customized items tailored to customer needs.
• Batch Production: Producing goods in groups or batches, with each batch moving through production together.
• Flow Production: Continuous production of identical items on an assembly line.
• Cell Production: Organizing workers into teams responsible for producing a complete unit of output.
• Productivity: The output per worker, machine, or unit of input over a period of time.
• Capacity Utilization: The percentage of a firm’s total production capacity that is actually being used.
• Stock: Raw materials, work-in-progress, and finished goods held by a business.
• Just-in-Time (JIT): A stock management system where materials and products are ordered and produced only when needed.
• Buffer Stock: Minimum stock levels held to avoid running out of stock.
• Lean Production: Techniques aimed at reducing waste and improving efficiency.

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2.5 External Influences

• Economic Growth: An increase in the output of goods and services in an economy over time.
• Inflation: The rate at which prices for goods and services increase over a period of time.
• Exchange Rates: The value of one currency expressed in terms of another.
• Interest Rates: The cost of borrowing money or the return on savings, expressed as a percentage.
• Taxation: The charges imposed by a government on individuals and businesses to fund public services.
• Unemployment: The proportion of people who are actively seeking work but are unable to find jobs.
• Recession: A period of economic decline characterized by reduced consumer spending and business activity.
• Legislation: Laws and regulations imposed by the government that businesses must comply with.
• Competitive Environment: The external environment in which businesses compete for customers, including market structure and rival firms.

Corporate Objectives and Strategy

• Corporate Objectives: Specific, measurable goals that a business sets to achieve its overall mission.
• Mission Statement: A declaration of an organization's core purpose and focus that remains unchanged over time.
• Strategy: A long-term plan of action designed to achieve a particular goal or set of goals.
• Tactics: Short-term, specific actions used to achieve parts of a larger strategy.

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Business Growth

• Organic Growth: Growth achieved through the expansion of a business's own operations rather than mergers or acquisitions.
• Inorganic Growth: Growth achieved through mergers, acquisitions, or takeovers of other businesses.
• Economies of Scale: Cost advantages gained by a business as it increases the scale of its operations, reducing the average cost per unit.
• Diseconomies of Scale: The disadvantages a business experiences when it grows too large, leading to an increase in the average cost per unit.
• Mergers: The process where two businesses agree to combine to form a single new entity.
• Acquisitions/Takeovers: When one business buys control of another business, either through purchasing shares or assets.

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Decision-Making Techniques

• Investment Appraisal: Techniques used to evaluate the attractiveness of an investment or project, such as:
  • Payback Period: The time it takes for an investment to generate enough cash flow to recover its initial cost.
  • Average Rate of Return (ARR): The average annual return on an investment as a percentage of its initial cost.
  • Net Present Value (NPV): The value of all future cash flows generated by an investment, discounted back to their present value.
• Decision Trees: A diagram showing the possible outcomes of a decision, helping to calculate the expected value of each option.
• Critical Path Analysis (CPA): A project management tool that identifies the sequence of activities required to complete a project in the shortest possible time.

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Business Strategy Tools

• SWOT Analysis: A framework to assess a business's internal strengths and weaknesses, as well as external opportunities and threats.
• PESTLE Analysis: A tool for analyzing the external macro-environmental factors affecting a business:
  • Political, Economic, Social, Technological, Legal, Environmental.
• Porter's Five Forces: A framework for analyzing competition in an industry, including:
  • Competitive rivalry, threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat of substitutes.
• Ansoff Matrix: A strategic tool used to determine growth strategies based on product and market:
  • Market penetration, market development, product development, diversification.

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Corporate Influences

• Corporate Culture: The shared values, beliefs, and practices that shape how employees and managers behave in an organization.
• Short-Termism: Focusing on immediate performance rather than long-term strategic goals.
• Long-Termism: Prioritizing sustainability and long-term value creation over short-term profits.
• Corporate Social Responsibility (CSR): A business's commitment to managing the social, environmental, and economic effects of its operations responsibly.

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Growth and Decline

• Franchising: A business model where one business (the franchisor) licenses its brand and business model to another (the franchisee).
• Retrenchment: Reducing the scale or scope of a business's operations to cut costs and improve financial stability.
• Diversification: Expanding into new markets with new products to reduce risk.
• Synergy: The idea that the combined performance of two businesses is greater than the sum of their separate parts.

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Global Strategies

• International Strategy: Expanding a business's operations into new geographical markets.
• Outsourcing: Contracting out certain business functions or processes to external providers.
• Offshoring: Relocating business operations to another country, often to reduce costs.
• Reshoring: Bringing business operations back to the home country.

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Performance Analysis

• Kaplan and Norton’s Balanced Scorecard: A strategic planning tool used to measure organizational performance using financial and non-financial criteria.
• Elkington’s Triple Bottom Line: A framework for evaluating a business's performance based on three factors:
  • Profit, People, Planet.

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Change Management

• Lewin’s Force Field Analysis: A tool for analyzing the driving and restraining forces of change.
• Kotter’s 8-Step Change Model: A step-by-step method for implementing organizational change, including creating urgency and building a guiding coalition.
• Resistance to Change: The reluctance of employees or stakeholders to adapt to new ways of working.

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Corporate Governance

• Stakeholder vs. Shareholder Approach:
  • Shareholder Approach: Focusing primarily on maximizing returns for shareholders.
  • Stakeholder Approach: Balancing the interests of all stakeholders, including employees, customers, and the community.

Globalization

• Globalization: The process by which businesses or organizations develop international influence or start operating on an international scale.
• Multinational Corporation (MNC): A business that operates in multiple countries but has its headquarters in one country.
• Global Market: A market in which goods, services, and labor are traded internationally.

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Emerging Economies

• Emerging Economies: Nations with high economic growth and rapid industrialization, often transitioning from developing to developed status.
• BRICs: Brazil, Russia, India, and China—key examples of emerging economies.
• MINTs: Mexico, Indonesia, Nigeria, and Turkey—another group of emerging markets.

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International Trade and Global Markets

• Exports: Goods and services sold by a business to customers outside the domestic market.
• Imports: Goods and services purchased by a business or consumer from another country.
• Balance of Trade: The difference between the value of a country's exports and imports.

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Trade Liberalization and Protectionism

• Trade Liberalization: The removal or reduction of trade barriers, such as tariffs and quotas, to encourage free trade.
• Protectionism: The use of measures, such as tariffs or quotas, to restrict imports and protect domestic businesses.
• Tariffs: Taxes imposed on imported goods to make them more expensive.
• Quotas: Limits on the quantity of goods that can be imported into a country.
• Subsidies: Financial support provided by governments to domestic businesses to reduce production costs and make them more competitive.

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Trading Blocs

• Trading Bloc: A group of countries that have formed an agreement to trade freely with reduced or no tariffs and quotas (e.g., EU, NAFTA).
• Single Market: A trading bloc with no internal barriers and common external barriers, allowing free movement of goods, services, capital, and labor.
• Customs Union: A trading bloc that applies common external tariffs on imports from non-member countries.

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Foreign Direct Investment (FDI)

• Foreign Direct Investment (FDI): When a company invests directly in operations or assets in another country.
• Offshoring: Relocating business processes or production to another country to reduce costs.
• Outsourcing: Contracting out business functions or processes to external providers, often overseas.

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Cultural and Ethical Factors

• Cultural Differences: Variations in customs, values, and practices across different countries, which affect business operations.
• Ethical Considerations: The moral principles guiding international business practices, such as avoiding exploitation and respecting workers’ rights.
• Corporate Social Responsibility (CSR): A business’s responsibility to contribute positively to society and minimize negative impacts on the environment.

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Global Competitiveness

• Global Competitiveness: The ability of a country or company to compete effectively in international markets.
• Comparative Advantage: The ability of a country to produce goods or services at a lower opportunity cost than others.
• Exchange Rates: The value of one currency in relation to another, influencing international trade.

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Political and Legal Factors

• Trade Sanctions: Restrictions on trade with specific countries, often imposed for political reasons.
• Embargo: A complete ban on trade with a specific country.
• Intellectual Property Rights: Legal rights to protect creations, such as patents, copyrights, and trademarks, in the global market.

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Global Marketing

• Global Marketing: Adapting marketing strategies to different international markets.
• Standardization: Using the same marketing strategy across all global markets.
• Adaptation: Modifying marketing strategies to meet the needs of specific international markets.
• Glocalization: A combination of global and local strategies to effectively market products internationally.

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Economic Indicators

• Gross Domestic Product (GDP): The total value of goods and services produced in a country.
• Income Levels: Average income per capita, affecting consumer demand in global markets.
• Human Development Index (HDI): A composite measure of a country's economic and social development, including income, education, and life expectancy.

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Technology in Global Business

• E-commerce: Buying and selling goods or services over the internet, enabling businesses to reach global markets.
• Technological Transfer: Sharing technology and expertise across countries and businesses.