Business End of Year Review Business List of Topics Related to the Business Shopify - The process of starting up a business The type of business organization Sources of finance E-commerce Simple Mills - Business planning/starting a business Place (How the product gets from producer to consumer) Organizational objective - Attract the paleo diet Sources of finance - Selling their house, angel investors The 4 P’s Promotion E-commerce - Amazon Market research - Market segmentation, target market - Research methods (Interviews, Focus Groups etc) Economies of scale - Ben & Jerry - - Business start-up Type of product - Different types of flavours Market research - When deciding the size of the chunks of the cookie dough Acquisition - In 2001, Unilever bought Ben & Jerry’s Mission Statement - Their 3-part mission guides the decision making process (economical mission, social mission, and product mission) Promotional strategies Early adaptor - Business starters using sustainable growth methods before other businesses - It came up with new ideas for flavours Concepts- change & ethics - Types of promotions Vision statement - Mission statement: “to serve and reflect the communities where we would set up shop. E-commerce The 4 P’s - - - &pizza - H&M - Organizational objectives- vision and mission statements Ethical objectives- ‘we do business “the H&M way” we do so ethically, honestly, and responsibly.’ SWOT Analysis Ansoff Matrix Strategies, tactics Volkswagen - Ethics Financial reports Intel - Types of economies of scale Types of production 7eleven - STEEPLE analysis Influence of innovation, ethical considerations and cultural differences on marketing Creating an appropriate marketing mix Market segmentation- geographic segmentation British Airways - STEEPLE Analysis How environmental conditions and market conditions has influenced a business Burlington - - Types of promotion E-commerce - Started online retails but then closed down Mission statement - Their ‘treasure hunt’ technique The 4 P’s McDonalds - Boston Matrix Perception Map Guerilla Marketing Economies/Diseconomies of Scale Product Life Cycle - extension strategies Starbucks - CSR (corporate social responsibility) Ethical objectives Lego - Final accounts Cash flow forecast Break-even analysis Profit and loss account - Other Topics That We Covered: ● The Super Bowl Commercials ○ Types of promotional techniques ● ● ● ● ● ■ Informative ■ Persuasive ■ Reassuring ○ Studying the different ways that the viewers might react ○ Guerilla marketing ○ Marketing objectives (SMART) ○ Above-the-line promotion Types of Pricing ○ Cost-plus ○ Penetration ○ Price skimming ○ Psychological ○ Loss leader ○ Price discrimination ○ Competitive pricing ○ Price leadership Types of Sampling Methods ○ Quota ○ Random ○ Stratified ○ Cluster ○ Snowballing ○ Convenience Sources of Finance ○ Internal ■ Personal Funds ■ Sale of Assets ■ Retained Profit ■ Sell and Lease Back ○ External ■ Loan Capital ■ Overdrafts ■ Trade Credit ■ Grants ■ Subsidies Break-even analysis ○ Break-even point ○ Break-even chart ○ Fixed costs ○ Total cost ○ Margin of safety ○ Break-even quantity ○ Break-even revenue Economies/Diseconomies of Scale ● ● ● ● ● ○ Technical (internal) ○ Managerial (internal) ○ Financial (internal) ○ Marketing (internal) ○ Purchasing (internal) ○ Risk Bearing (internal) ○ Consumers (external) ○ Employees (external) Stages in Product Life Cycle ○ Development ○ Introduction ○ Growth ○ Maturity ○ Saturation ○ Decline ○ (Extension Strategy) Profitability and Liquidity Ratios ○ Profitability Ratios ■ Gross-profit margin ■ Net-profit margin ○ Efficiency Ratios ■ Return on capital employed ○ Liquidity Ratios ■ Current ratios ■ Acid-test (quick) ratio Investment Appraisal ○ Payback period ○ Average rate of return Market Segmentation ○ Demographic segmentation ■ Age ■ Gender ■ Religion ■ Ethnic grouping ○ Geographic segmentation ■ Climate conditions ○ Psychographic segmentation ■ Social and economic status ■ Values Primary and Secondary Market Research ○ Primary ■ Surveys ■ Interviews ■ Focus groups ● ● ● ● ● ● ■ Observation ○ Secondary ■ Academic journals ■ Media articles ■ Government publications ■ Market analyses Distribution Channel ○ Zero intermediary channel ○ One intermediary channel ■ retailer/agent ○ Two intermediaries channel ■ Wholesalers ■ retailers/agent Balance Sheet Terms (Main terms) ○ Working Capital ○ Total Assets Less Current Liabilities ○ Net Assets ○ Equity ○ Retained Profit Profit-Loss Account Terms ○ Sales Revenues ○ Costs of good sold ○ Gross profit ○ Expenses ○ Net profit before interest and tax ○ Tax ○ Net profit after interest and tax ○ Dividends ○ Retained profits Methods to reduce cash outflow ○ Negotiate with suppliers/creditors to delay payment ○ Purchases of fixed assets can be delayed ○ Possible to source cheaper suppliers Methods to improve cash inflow ○ Businesses can insists that customers pay in cash only ○ Offer discounts/incentives to encourage debtors to pay early ○ Firm diversify product offering Boston Matrix ○ Quadrants ■ Stars ■ Question Marks (Problem Children) ■ Cash Cows ■ Dogs ○ Strategies ■ ■ ■ ■ ● ● ● ● ● ● Holding Strategy Building Strategy Harvesting Strategy Divesting Strategy Promotion ○ Above the line ■ Informative Advertising ■ Persuasive Advertising ■ Reassuring Advertising ○ Below the line ■ Direct Marketing ■ Personal Selling ■ Public Relations ■ Sales Promotion Extension strategies ○ Selling existing products into new markets ○ Find new uses for product ○ Change the packaging of product ○ Target different market segments ○ Develop new promotional strategies Branding Terminology ○ Brand awareness ○ Brand development ○ Brand loyalty ○ Brand value Principles of Guerrilla Marketing (“APENS”) ○ Activity ○ Presence ○ Energy ○ Networks ○ Smart Factors in locating business ○ Costs ○ Competition ○ Type of land ○ Markets ○ Familiarity with area ○ Labour pool ○ Infrastructure ○ Suppliers ○ Government (laws and taxes) Types of E-commerce ○ Business-to-business ○ ○ Business-to-consumer Consumer-to-consumer
