1. Unit 1

2.  Understand what business does,  Appreciate that most businesses are small,  Appreciate that a large number of businesses are created and closed down each year  Understand the concept of production, suppliers, customers and markets  Appreciate that there are many important aspects to starting a business.

3.  There are over 4 million businesses in the UK  Only 33,000 employ over 50 people,  ¾ of all businesses are Sole traders – one person  An estimated 200,000 new businesses are created each year in UK,  Only 1 in 10 will make it past the first year, 1 in 3 past 3 years, less than half will exist after 5 years

4. Spot the business opportunity. Finances to consider – money to start, making a profit What do you need to start the business? Legal aspects, Health and Safety, insurance, tax liability The Business

5.  Why do we need business? And why do businesses exist?  They exist to provide goods and services.  Most businesses make services, about 70% of all produced is a service in the UK, nearly 8 out of 10 people work in a service industry.

6.  There are 3 different areas that a business can work in:-  Primary Sector  Secondary Sector  Tertiary Sector

7.  Primary production: this involves acquiring raw materials. For example, metals and coal have to be mined, oil drilled from the ground, rubber tapped from trees, foodstuffs farmed and fish trawled. This is sometimes known as extractive production.

8.  Secondary production: this is the manufacturing and assembly process. It involves converting raw materials into components, for example, making plastics from oil. It also involves assembling the product, eg building houses, bridges and roads.

9.  Tertiary production: this refers to the commercial services that support the production and distribution process, eg insurance, transport, advertising, warehousing and other services such as teaching and health care.

10.  Businesses buy the products they need from suppliers – firms selling products to other businesses - and sell to customers. The individual who uses the product is called a consumer. Sometimes the customer and consumer are different people - for example, parents buy a pen for their child to use at school.

11.  Businesses sell to customers in markets. A market is any place where buyers and sellers meet to trade products - this can be a high street shop or a website.  Businesses are likely to be in competition with other firms offering similar products.

12.  In order to create goods and services, a business buys or hires inputs such as raw materials, equipment, buildings and staff. These inputs are transformed into outputs called products. These products are the goods and services used by consumers. Production is the business activity of using resources to make goods and services.outputs  A business adds value when the selling price of an item produced is higher than the cost of all the resources used to make it. Think of a pair of designer sunglasses which sell for £100. If the cost of the materials, employees, marketing and all other inputs used in making one set of sunglasses is just £20, then £80 worth of value has been added by the firm during production.

13.  Goods are physical things eg a can of beans, pair of skis, a Nintendo DSi.  Services are non-physical things like a hair cut, a lesson or a visit to the doctor

15.  Businesses make goods and services by buying raw materials, labour and machines and using them to make the products.  The products are then sold to the customer.

16. Padmore Bouncy castle Hire Jack Padmore has just setup a business hiring bouncy castles for parties etc 1. List the resources would he use. 2. List the raw materials that he uses 3. List the labour that he uses

17. 1. Resources:- the bouncy castle, electric pump to blow it up, a van to transport the castle 2. Raw materials:- Petrol for the van and electricity to keep the castle up. 3. Labour:- his time to take and put the castle up and take it down again

18.  Businesses buy the goods and services they need from SUPPLIERS.  Businesses sell to CUSTOMERS, they are the consumers of the product or service. Businesses can also be consumers.  A market is where buyers and sellers exchange goods and services.  A business can be in different markets.

19. Padmore Bouncy castle Hire Jack Padmore has just setup a business hiring bouncy castles for parties etc 1. How is Jack a supplier, who to and why? 2. How is jack a customer and why? 3. What markets is Jack in?

20. Padmore Bouncy castle Hire Jack Padmore has just setup a business hiring bouncy castles for parties etc 1. Supplier, supplies bouncy castles to his customers 2. Customer and why? To the garage for his fuel and his use of electricity 3. What markets is Jack in? The service sector, in the Bouncy Castle hire market.

24.  What reasons can you think of  Justify your answer please.

25. 1. The resources you would need, 2. What markets would it be in as:- 1.A supplier 2.A customer. 3. What would you have to consider for setting up the business?