Chapter 1: Business Ownership Pg.

1
Aspects of a business to consider when making decisions about the form of organization include:
- Tax: Form that minimize taxes
- Ownership: Best share business ownership
- Liability: Best protect owners/investors from debt/personally liable
- Succession: set up and control ownership
- Sources of finance: Capital needed to start the business
- Size: The number of employees/owners

Definition Ownership / Taxation Advantage Disadvantage

1 single person Run in the name of the Has full control Unlimited liability (Pay
operates a business owner or registered Keep all profit debt with your assets)
Sole Trader
under their name. Business profit are taxable Easy to set up No-one to share
income workload
2 – 20 people All partners must agree for Easy to establish Unlimited liability
operate a business new person to join Partners can bring money Disagreement
Partnership
Business profit are taxable and skill Rule must be set
income (but shared) Work can be shared Shared profit
< 50 shareholders. A Shares cannot be offered Limited liability Expensive to set up
Small separate legal entity, to the public People can sell their share Profit are shared
Proprietary has (Proprietary - Pays as a company rate when they leave Must operate within
Company Pty) and (Limited - the Corporations Ac
Ltd) in its name
Money in go back Both Unincorporated and Inexpensive to Limited operating
into intended Incorporated incorporate range in the state of
Not for Profit
purposes, NOT share Exempt from tax Few formalities and low incorporation
Organization
among members requirement No clear guideline
No tax
Licensing a model to Franchisee own the Strong brand image Act based on the
people for fees and franchise, but must meet Offer training and franchisor’s regulations
royalties the franchisor’s rule to sell assistance Less autonomy in
Franchise Depend on franchise’s form Provide procedures, decisions
manuals and Restricted territory
management On-going cost payment
Easy market present Can’t sell the business
Very large Board of Directors and Can sell share to public Legal formalities
Public businesses, well managers (shareholders Rapid expansion Disclosure of accounts
Company known to the public occasionally in AGM) Limited liability Expensive
Pays as a company rate Continuity Disagreement

Chapter 2: The Legal Framework of Business Pg. 7

It’s illegal for business to make statements that are incorrect or create a false impression.
Breaking the Legal Regulation is prohibited, businesses will face consequences if do so:
- Monetary penalties
- Injunctions to force the business to stop the conduct
- Damage award to customer
- Orders to advertise corrections or provide repair
 Misleading and Deceptive Conduct
Discount product that is not in stock
Bait Advertising
False claims about the country of origin or ingredients
Criteria for “Product of …” or “Made in …”:
Country of Origin - Each significant ingredient must originate from the country of claim
- All production or manufacturing process must take place in the country of claim

Scientific Claims Making scientific claim about the product without proof
Fine Print Small print and disclaimers to hide information and mislead customer
Wrongly Accepting Only accept cash if able to supply good or service
Payment
Prohibited offering prizes/gifts/other free items if:
Offering Gifts and - The business doesn’t have the intention of giving
Prizes - Not providing it within a reasonable time

Guarantees, Warranties and Refund:

- Customer are entitled to Guarantees and Warranties upon purchase, and Refund if the
product fail to fulfil its purpose ►Customer Protection
- The business must inform the consumer about any legal restriction of the product
Consumer/Business Responsibilities
Tradable Meet basic safety, quality and performance for the price and description of the product
Suitable Must do the job or satisfy the need as indicated
Matches the The product must match pre-purchase sample/description
description

Customer action for a guarantee (if the guarantees doesn’t work):

🡺 Resolve the issue with the business

🡺 Complaint in writing (WITH DETAILS of the purchase’s date, problem and preferred solution)

🡺 If it’s a local business, contact the Consumer Protection

🡺 Make a official claim at the Magistrates Court

Types of Warranties
Voluntary The manufacturer warranties, used to highlight the quality of the product
Extended Extends beyond the statutory and voluntary period, customer have to pay for it
Statutory Refund under certain conditions regardless of the warranty provided by the business

Product Safety:
Product safety laws cover:
- Consumer product: intended for personal/domestic/household uses
- Product related services: Services related to Customer product such as
installation/maintenance/repair/cleaning/assembling/delivery
Businesses is responsible for ensuring the product are safe and comply with product safety law; if
not, things can happen:
- Injuring customers
- Products being removed from shops
- A recall of all products
 - Fines and damages
- Bad Public Image

Mandatory Standard
Safety Information
The following must all be safe: Manufacturing Customer have the rights to receive information of
processes, ingredients, how it works ingredients/warnings regard to usage and storage
Customer has the right to receive safety warnings Provide instructions about safe use/care of the product
about use and storage
Illegal to sell products that doesn’t meet Recalled product must be advertise widely and notify all
safety/information standard sellers/purchasers

Statutory guarantee gives consumers the right to a refund if a product is faulty or unsafe. This apply
to all goods and services
- Major Problems can be treating with a replacement or refund: not of acceptable quality/not
fit for the purpose/ does not match the description
- Minor Problems, easily repair can be treated with repair for free instead of
replacement/refund. If not repair in reasonable time, the customer can request
replacement/refund
Customer can also seek compensation for damage/injury/loss caused by a safety defect in a product
Managers can ensure their products are safe by:
- Conducting regular tests
- Having quality testing system
- Provide clear usage instruction
Government are less likely to penalize businesses if it is proactive and conducts quick voluntary recall
of any products with safety concerns
National Employment Standard (NES):
- Educates people about fair work practices, rights and obligations
- Investigate complaints
- Enforce workplace laws

Minimum Working Condition

Max 38 hours/week
Flexible work arrangement
12 months unpaid parental
leave
4 weeks paid annual leave
10 days/year personal leave
Leave for community service
Long service leave
entitlements
Paid public holiday
Minimum notice period
Fair work information
statement
38 maximum, no more
12 months of service can request this
12 months of service can request this
Work hour ▲ Annual leave ▲
Casual employee only has 2 unpaid leave
10 days paid if called if for jury service
2 months after 10 years
Public holiday in normal working day
Depending on the work/length of service
Be provided with a copy of Fair Work Ombudsman

- Minimum Wage: Can’t pay less than a set amount per week for a full time job.
 Disable person: pay according to work capacity. Example: 80% work capacity = 80% minimum wage
- Dismissal: When an employment is ended by the employer
Fair and valid reason for dismissal:
⇨ Ability to do the job

⇨ Performance in the workplace

⇨ Operational requirements
Unfair dismissal: Harsh and unreasonable, not genuinely redundancy, doesn’t follow Small Business
Fair Dismissal Code (SBFDC)
Small businesses cannot make an unfair dismissal claim if they are dissed in the 12 months after
being hired. Big businesses is 6 months (Small businesses include less than 15 employees)
- NO CHILDREN LABOR (at least 15 or older)
- Contract: A contract is valid when a person sign/pay/agree on a term/object/agreement
- Examples: Employment/loan/phone plan/vehicle contracts

Element of a Contract
Intention Create legal binding where rights and obligations are enforceable
Agreement offer and Negotiating, one party give an offer and the other accept it
acceptance
Value exchanged between parties, usually money but can also be the performance of an
Consideration
act or the provision of service
Legal Capacity 18+ and of sound mind (sane)
Free will and have proper understanding of what is involved. If there is no consent, then
a breach of statement exists. Consent can be affected by:
- False statement
Consent (Voluntarily)
- Duress
- Forcing

Legality of purpose Must be legal, the contract is invalid if it requires parties to do anything illegal. Some
and form contract must have certain details to be valid

Advantage of a contract:
- Clearly defines the promises
- Outlines processes
- Describes profit and loss are to be shared
- Process to terminate the contract
- Certainty regarding income and cost
- Schedule and timeline
 Chapter 3: Economic Impact on Business Pg. 23
Factors Process Impact
Economy doing well People spend more time searching for lower prices
Demands  Supply Import less expensive goods
Inflation Prices  (Business know that people are Difficulty for businesses (Supply cost Selling price =)
willing to pay and capable to pay) Stop/less buying expensive brands
Spending  Debt level  Spending 
Debt Cost/Interest  = More Debt Debt 
Interest Money/Spending  Discourage people from loans and credit cards
Rate Spending  Inflationary Pressure 
Vice Versa
Labor Force  Supply  Income  Spending  (Especially luxurious items, such
Supply of Specialized Skills Demand  as travel, entertainment, etc.)
Labor Wages/Payments  Economy 
Vice Versa
Unemployment  Spending (Due to Income) (Only spend on essential
Income/Payment  goods)
Unemploym Labor Availability  Demand  (Due to Spending)
ent Rate Payment Pressure  (Due to Labor Availability)
Specialized skills are lost (Due to Unemployment)
Confidence (Due to Labor Availability  losing jobs)
Vice Versa
Exchange Rate  Purchase  Import/Import Price 
Currency
Value  Spending  (Due to Cheaper Price)
Exchange
 Cheaper Price
Rate
Vice Versa

Chapter 4: Corporate and Social Responsibility Pg.

29
Public image: ideas and opinions of the public about a company/business
🡺 It’s how the business is perceived and its reputation to the community

🡺 Decide where a consumer shops (similar produce + similar price)

Creating Public image: advertisement, public relation and community engagement
🡺 Public relation so how they are committed to the community, which will be held higher in
customers’ standard

Positive Public image can:

- Make you stand out from the competition
- Improve customers’ loyalty
- Strong brand image
- Attract and keep employees motivated
Things that ruin a good Public image: treating the employees/community badly, false advertisement,
etc.

Strategies to build a positive Public image:

 1. ‘Green’ Gifts:
Recycling show the commitment to the environment
2. Donate to a good cause:
Show the goodwill and caring-ness to the community
The recipient of the donation will publicize the support -> advertisement
3. Exceed expectations in service:
Providing exceptional services will increase customer’s satisfaction
Word of mouth will grow out by treating customer better than competitors
4. Be ethical:
Treating customers and suppliers honestly
Promises and honoring guarantees and warranties
Treat employees ethically and motivate them and encourage loyalty
5. Corporate sponsorship:
Business relationship where 2 parties exchange economy
Sponsorship can be a combination of: Finance, space, foods, equipment, staff, etc.
The sponsor will receive:
a. Visibility:
Logo and slogan of the sponsor will be featured in the show

b. Positioning:
Supporting an event with good intention toward the community will transfer the positive
image to the sponsor

c. Publicity:
Sponsor will be mention -> free advertisement adding to brand awareness and creating
Public image

d. Market reach:
Sponsorship is more effective if the company is targeting the same market
Exclusive sponsorship is when only 1 company is able to sponsor an event. The more exclusive the
better, the aim is to transfer the good deed to create a positive Public image, and the company won’t
need to share it. Involving with the community equals caring equals positive Public image.
🡺 Impact of Environmental issues on Public image:

Environmentally responsible = positive Public image

1. Climate change:
Business contribution to Climate change is measured by their carbon footprint
The public expect businesses to be aware and managing their contribution to Climate change
2. Pollution:
Pollution control is dealing with contaminants after they are created or released into the
environment
Prevention strategies ► Reaction strategies (not a lot of business have done this)
3. Energy use:
Be energy efficient
4. Animal testing:
Public image can suffer if it’s related to animal cruelty
5. Greenwashing:
 No deceptive and misleading conduct (don’t fake to be environmentally friendly)

Chapter 5: Understanding Your Market Pg.

1. Market: where transactions and deals take place, facilitating the product and the provision of
information of the product
2. Marketing: the activities undergone to plan, price, promote and distribute a product to
customers
3. Customer: people who already bought or potentially will buy the product

Market size: all the consumers that the business has decided to supply
Market share: the percentage of the entire market that an individual business has
Enlarging the whole market: Increase the number of customers
All consumers -> Potential market -> Target market

Definition Example Advantages Drawback

Dividing a market Demographic Focus on successful part Imprecise
into parts that (population Benefited from segment Can’t reach all
Market
reflects different attribute) development customers
Segment
consumers’ wants Geographic (location) Focus on the needs Fast changing market
(Targeting)
and needs. Lifestyle (attitudes Effective marketing
and values)
Behavioral (usage)
Group of Targeting a market 1. Mass Marketing: target the whole market,
consumers share can help design the undifferentiated, ignore segment
the same wants product that fits the 2. Segmented: target specific segments, differentiated,
Target market
and needs. Which 4P’s, that directly customized to fit the segment
the business appeals to potential 3. Concentrated: target smaller segments, aim to
targeted customers achieve a strong market position within it (niche)
Information needed Sales target, product range, competitors, customer support in changes, market alternating
Collects data first Focus group: Ask a group of Focus on an objective, Time and resources
hand for specific people for opinions tends to be consuming
Primary
research purpose Interview, Survey up-to-date, details Maybe bias
Research
Mystery shopper, testing and insight (customers’
trials view)
Data that’s Market reports, trade and Free, easy to obtain, Quickly out date, not
already exist, industry association, sales good source of fit every research,
Secondary collected for transactions, big data, market insight, quick specialist reports are
different analytics access and use quite expensive
purposes
Is there a market? Objectively
Potential market’s size? considered
Target market’s size? Secondary research
Will goals be met? can help
Can provides important data
Analysis Will customers be satisfied?
Enable business to satisfy its customers
Current trend and changes? Compare goals with
result
Survey customer
External analysis
 Idea of the customer
about the product.

Market positioning
Positioning maps are maps that
show how important
a product is from
the consumer’s
point of view.
Marketing Marketing plan help the business to reach its marketing goals in the chosen target market
Campaign
A summary of the existing situation of Product. Price. Place. Promotion
Market Position
the business
External factors that would impact the Political. Economic. Social.
Current Market
business Technology
Competitors Analyzing the competitors (PEST and Product. Price. Positioning.
Analysis SWOT) People. Premise. Type
Marketing goals Specific. Outline what the business wants to achieve relating to the product
Marketing
Benefits come with product: delivery, warrantees, branding,
Plan Product
etc.
Price Price setting, discount, cheaper, etc.
Marketing Promotion Advertisement, sales deals, public relations, etc.
Strategies Place How the product will be distributed and sold, networks, etc.
People Staff, training, skills, etc.
Process Customer service experience.
Performance Satisfaction and competitiveness
Costing List each product, decide on the percentage of total sales that it may supply.

Chapter 6: The Marketing Mix Pg.

55
Marketing Mix: Factors that work together in order to achieve the marketing objectives that the
business has set.
Extended Marketing Mix include: Product, Price, Place, Promotion, People, Process and Physical
Presence
A consumer will purchase a product that meets their wants and needs
Packaging, branding and labelling can be use at different stages of the product cycle to distinguish it
from the competition

Market
Product
growth

Step to positioning: Target market > Current product’s features > Customer
Positioning perception > Distinguishing product in market > Ideal combination of features and
market > Compare between current product and the ideal
Price must cover the cost, meet profit objectives, in the customer's “willing to pay” range, and remain
Price
competitive in the market.
 Too high > expensive, Too low > poor quality
High price for new product, maximize profit
Top segment skimmed off first, with highest price
Objective: Maximize profit to quickly recover cost
Skim Pricing
Exp: Gadget, cars, etc. (high demand on release)
Need strong brand image and good quality, enough buyers, no competitors or
under-cutting
Low price for new product, gain market share quickly, build brand image and
loyalty
Penetration
Build sale on related item (bait and hook)
Pricing
Exp: IKEA, Consumables, etc. (high price sensitivity, must create enough profit)
Permanent low price, no under-cutting, bargain instead of loyal, retaliation
Set price based on customer perceptions of quality, convenience, security or
Psychological
satisfaction
Pricing
Exp: $199 instead of $200
Premium Pricing Higher price in niche market or exclusive and high-end items
Lost Leader Price lower than the cost. By saving, customer can spend money on other items
Pricing with a profit margin to be made
Communication of information about the product to the target market, whilst also influence the
behavior and attitudes of the customer
Direct selling through viral marketing, telemarketing, sales
Personal selling
staffs etc.
Publicity Positive news stories, media releases, product launches, etc.
Promotion Sales Promotion Special deals, customer loyalty, coupons, samples, etc.
Promotional
Advertising Media, internet, print and mass media, etc.
Methods
Customer is directly advertised to, and distribution chain is
Push Promotion
flooded with product
Lot of spending on advertising before the release to create
Pull Promotion
demands
Distributing the product or service to consumers.
Distribution channel must: a) provide security, b) motivate wholesalers and retailer to improves sales,
c) Least distribution stages, d) Time management
Producer -> Customer Small customer base for small items
Place
Producer -> Distributor/Agent -> Specialized product or new to the market (commission for
Customer agent)
Producer -> Wholesaler -> Retailer -> Most common model, wide product range and large
Customer customer base, must frequently restock
Business can define is competitive advantage by focusing on its customers, through ensuring that
employees are well trained and competent
People marketing include: Relationship marketing, training, marketing to suppliers and employees,
People
quality service
Relationship Customers are treated as individuals, build connections with staff, more positive
marketing and motivated staff and happy customers. Repeat customer can purchase more
Correct customer service and great customer experience, inquiries and quotes.
Process
Effective services encourage customers to return, building loyalty
All the elements of the business identity that the customer can see.
Physical
Exp: shop front, signs, uniforms, etc.
 Chapter 7: Customer and Competition Pg.
71
🡺 Consumer: anyone who uses the product or service of a business

🡺 Customer: consumer but return to a business frequently for a good/service (custom)

🡺 Customer mindset: best price or best product, purchase for self or for someone else. Online
selling generally speedy and cheaper

Adding value to a customer’s experience:

1. Good first impression
2. Accurate description
3. Listens to customers
4. Fully inform them
5. Ensure they understand the requirement
6. Provides options
7. Complaints are resolved

Collecting information about business’ customers, specific groups in relation to the target
Customer Profiling
market
Customer buy to satisfy their initial need or want
They buy motive is conscious with a quantifiable reason Exp: Reliability,
to purchase durability,
Rational
-> logical, straightforward marketing that highlight the efficiency, ease of
benefits of the product use, expense
May have more influence on buying than rational Exp: finance gain
Buying motives
-> Enhanced prestige, advertisements that include a or loss,
sense of fantasy self-gratification,
Emotional comfort or
convenience,
security,
satisfaction
Being aware of trends and fashions, the business can keep customer loyalty
Market leader can influence market trend
Trend and Fashion
It’s valuable to respond to and exploit market trends because of the potential return for
the business from meeting the needs of the identified customer

Collect information able competitors who are producing a similar product or service
Include a Strength Weakness Opportunity Threat analysis
Mission statement? Business structure? Available Information? Main customers?
Profile
Advisors?
Competi
Management Who makes decision?
tor
Position? Target market? Branding? Customer loyalty? Product range? Pricing?
profiling Marketing
Marketing?
Operation Work element? Processes? Risk management? Geographic advantage? Distribution?
Resource Human? Physical?
Finance Assets, income, etc.
 Business manage customer relations by providing good customer service
If done well, it should result in customer loyalty and repeat business
Customers will make queries about the product; staff must be able to assist
them.
Written form or web-based information is also fine, but queries must be clearly
answered
🡺 Use short, simple, clear language

🡺 Explain technical terms and abbreviation

Customer 🡺 Ensure documents reach to customer
Queries
🡺 Make documents interesting for the target market

🡺 Up-to-date information and print the publish date

🡺 Geographically applicable and relevant

🡺 Warranty must be auto-given, assist with return and complaint

Customer Staff is the presentation of the business to its most important stakeholder
Relationship
Management 🡺 The interaction decide whether it’s a good or bad customer experience
Interaction
🡺 Must be train to give fast and accurate answer

After the customer used the business’ services or product, follow-up will be
required
🡺 Send a timely letter or email to the correct address for confirmation
Follow-up
🡺 Follow this till the customer has made the final decision or require more
details

Customer’s order must include essential details must be written: reference

Documentat number, customer details, exact order details, additional information for delivery
ion of orders and installation and contractual details
Changes in tract must be inform immediately
Billing Efficient customer friendly process = less stress for staff = better experience
customers
Return and repair is tough, customers need to be listened to on what is the
After Sales
problem and how it occurred. Good complaint management procedures can turn
Service
a potentially negative situation into a positive one for the customer

Chapter 8: Organizational Structures Pg.

87
- Levels of management:
o Top: Board of directors/chief executive officer/general manager
o Middle: Managers/supervisors
o Frontline: Employees who work directly on the product
- Factors of an organization charts:
 o Accountability: taking or being assigned responsibility for something that you have
done or something you are supposed to do.
o Distribution of responsibility: power to make decisions about the organization.
o Coordination between positions: communication across the organization.
Note: other elements of decisions in organizational structures
- Centralized vs. Decentralized: how authority is distributed
→ centralized management prioritizes product quality control (order is distributed from only one
party + reports end up in only one place) ≈tall structure
→ decentralized management prioritizes new product/services/idea generation (order can be
distributed from many parties/employees have more power - responsibilities) ≈flattened structures

- Features of organizational structures:

Chain of command How the hierarchy is set up
Span of control Number of employees who work directly for a manager
Responsibility A duty to satisfactorily perform or complete a task
Accountability Who do a person report to in the hierarchy
Delegation Assigning a specific task or purpose to a person or group of people
* Lines represents the direct formal line of command, while dotted line represents indirect line of command

Individual managers and employees together make up a business organization. A traditional

hierarchical style of organizational structure typically has:
- Several layers of management
- Information directed downward
- Major decisions being made at the top
- A clear chain of command and span of control

Hierarchical/tall vs. Flattened structures:

Hierarchical/tall Flattened
Advantages Product quality control ▲ New product generation
Production rate/productivity ▲ Employee empowerment
(Boss takes all decisive power) Fast communication

Disadvantages Too stiff (unable to adapt to Product quality control 

changes)
Slow communication
🡺 Hierarchical: suitable for Mass Market products

🡺 Flattened: suitable for Niche market products

4 Main Types of Hierarchical Organization Structures

Advantage: Disadvantage:
Functional Structure: - Task specialization - Rigid and inflexible
Example: Marketing, - Clear career pathway - Centered personality
Finance, Operations, etc. - Higher skill level in work area - Detriment of other areas

Product Structure: - Make quick decision - Duplicating resource and

Example: Frozen foods, - Meet customer needs more effectively function
Meat, Bakery, etc. - Focus on specific market segments - Spreading overhead cost

Divisional or geographic - Respond more appropriately to local - Duplicating resource and

Structure: community needs function
Example: West, South, - Lessen competition between areas - Spreading overhead cost
North division, etc.

Customer Structure: - Meet customer needs more effectively - Duplicating resource and
Example: Household, Small - Easy customer classification function
businesses, etc. - Spreading overhead cost
- Conflict over resource

Expanded organization chart: More details

Changing the Organizational Chart:
- Organizational Restructuring:
o Major Change: Complete restructuring, new systems, altered workstations or new
technologies
o Minor Change: Only affect a few employees
- Factors Need to be considered when changing the Organizational Chart:
o Employee Empowerment: The 2-way relationship between manager and employees
▪ Rely on intangible factors; individual is trusted to make decision to some
degree, encourage to give feedback and to make changes as required
o Teams: Groups of people work in the same division, same project
▪ Team members need to be adaptable, encouraged to be innovative and
communicate effectively and resolve conflicts.
o Flattening the organizational chart: Remove the middle layer of management
▪ Employees become more responsible and countable as work is delegated to
them, less chain of command and broader span of control
o Diversification: chapter 6!
o Outsourcing: Contracts to worker that are not part of the organization
▪ Complete precise elements of work, use for part that is not considered
essential to the core goals or mission
- When an organization changes from a (Traditional Chart), it will become a matrix, team or
network structure, affecting all these elements of teams, diversification and empowerment
Complex Organizational Charts: More flexible and respond to changes quicker
- Matrix: include project managers
 Weak Project Manager has limited power
Functional Matrix
Balanced Project Manager has equal power to Functional Manager
Project Matrix Strong Project Manager is primarily responsible
- Network: very flexible and responsive

- Team: Employees are empowered and layers of management are removed.

o The aim is improving communication, encouraging cooperation, speeding up
decision making and generating innovative business solutions.
o Business needs to define the projects, select team members, outline their role and
monitor their progress.
- Team approach (The life cycle of a team):
Forming The team members are getting to know each other
Storming Establishing their roles within the group
Norming Set the norm/standard within the group
Performing Responsible for their work (progress and efficiency)
Adjourning Break up and move on

Chapter 9: Business in Society

Pg.119
Spending pattern: How consumer spend their money, affected by: (Chapter 3)
- Economy
- Preferences
- Lifestyles
Economic activities:
 High E/A Low E/A
Low unemployment High unemployment
Increase wage/disposable income Low wages/disposable income
More choices in goods and services Less choices
Businesses compete on service and value Businesses compete in price
Result
Inflation: Increasing interest rate Deflation: Decreasing interest rate
Inflation: Value changes (increase)
🡺 Big, expensive items change the economy more

🡺 Spending keep the economy going – encourage spending to boost the economy

🡺 If consumers don’t spend, businesses won’t make profit and it will weaken the economy
- Consumer Sentiment Index: (sentiment: general idea of people toward something)
o Survey of consumer about their opinions on:
▪ Their financial situation past and incoming years

▪ Economic situation of incoming years

▪ How affordable it is to buy major household items

Substitution effect:
- When the economy is weak, people will look for cheaper alternatives.
-
Management Role:

Defining vision and mission

Goal and objective
Planning
Strategies
Action to achieve goal
Business structure
Organizing Resource allocation
Job design
Leadership and direction
Leading Motivation
Communication and coordination
Process and standard
Controlling Review and Evaluation
Correct action

Leadership/Management styles:
I. Autocratic/Authoritarian leader:
a. Make all decisions by themselves, without consulting others
II. Democratic or participative leader:
a. Take employees’ ideas in decision making, benefit both the business and personnel
Element Autocratic Participative style
Control Top down Bottom up, 2-way
Decision making Centralized Decentralized
Motivation Extrinsic Intrinsic
Guidance Coercive Collaborative
III. Situational leader:

Supportive Coaching
Delegating Directing