What does it mean to be bankrupt?
When an individual is unable to pay their debts, even after all personal assets have been sold for cash.
What is limited liability?
Restricting the losses suffered by owners/shareholders to the sum they invested in the business.
What is a private limited company?
A small family business in which shareholders enjoy limited liability.
What is a sole trader?
A business run by one person; that person has unlimited liability for any business debts.
What is unlimited liability?
Treating the business and the individual owner as inseparable, making the individual responsible for all the debts of a failed business.
What is franchising?
Paying a franchise owner for the right to use an established business name, branding and business methods.
What are royalties?
Percentage of the sales revenue to be paid to the overall franchise owner.
Who is an entrepreneur?
A person who sets up a business and takes on financial risks in the hope of profit.
What are fixed premises?
Buildings that have to be where they are, such as those on the high street.
Example: High street shops cannot relocate easily.
Where can e-commerce buildings be located?
E-commerce buildings can be located anywhere.
What does proximity refer to?
Proximity refers to nearness, particularly whether a business wants to be close to factors such as materials.
What does ‘Place’ refer to in the context of the 4Ps?
It refers to how and where the supplier is going to get the product or service to the consumer, including selling products to retailers and getting the products displayed in prominent positions.
What does ‘Price’ involve in the 4Ps?
It involves setting the price that retailers must pay, which in turn affects the consumer price.
What is meant by ‘Product’ in the 4Ps?
It means targeting customers with a product that has the right blend of functional and aesthetic benefits without being too expensive to produce.
What does ‘Promotion’ encompass in the 4Ps?
It encompasses all the methods that a business uses to persuade customers to buy, such as branding, packaging, and advertising to boost the long-term image of the product and short-term offers.
What is a business plan?
A detailed document setting out the marketing and financial thinking behind a proposed new business.
