TERM 3

BUSINESS STUDIES
GRADE 1O
Via Afrika Business Studies
SUMMARISED STUDY GUIDE
By: RANGATA MM

PLEASE NOTE:
This study guide is only for term 3
In term 3 only four (4) topics are done accordingly to the ATP
This study guide is consisting of only 3 topics from topic 2
The first topic (creative thinking and problem solving) of term 3 was done in class handouts
were provided
ENJOYYY!!!!!

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 TOPIC 2: Business opportunities

Unit 1: Identifying business opportunities

1. Why do research?

The business must know what information they want to collect before they decide on
a research instrument or method. When we do research, we ask:

What, when, where and how do customers want the product or service?

2. Developing a research instrument

Typical information an entrepreneur will have to collect includes:

•the potential market for a new product or service

•clients’ satisfaction levels with products or services that are being offered currently

•the possible geographical position of a potential new business

•the demography of a community

•the average level of income in a particular community.

Entrepreneurs need to collect primary and secondary data about prospective

customers.

2.1. Primary data

 Primary data is the information an entrepreneur has to collect. An

entrepreneur can also appoint other people to collect the data.

The following are examples of primary data:

the potential market for a new product or service

clients’ satisfaction levels with products or services that are being offered currently
the possible geographical position of a potential new business.

2.2. Secondary data

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  Secondary data is information that has been collected by organizations such
as banks, government departments, the South African Reserve Bank and the
Department of Trade and Industry.
 Examples of secondary data is the demography of a community or the
average level of income in a community.

3. SWOT-analysis

•SWOT is an acronym for ‘Strengths, Weaknesses, Opportunities and Threats’.

•Think of all the strengths and weaknesses of a new business idea, as well as all the
opportunities and threats posed by competitors and the market.

•Determine whether you are in a position to fulfil the needs and wants of prospective
customers you identified.

Strengths The factors that make a product or service unique, giving

competitive advantage

Weaknesses Factors or characteristics of a product or service that could be

a disadvantage

Opportunities External factors that could place a business idea at an

advantage

Threats External factors that could place a business idea at a

disadvantage

Unit 2: The research processes

•Primary data can be collected by the entrepreneur.

•Primary data are collected by means of:

observation, by watching consumer behavior and buying patterns

interviews that can take several forms, for example personal face-to-face interviews
telephonic interviews and postal surveys

1. Test sample

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Before collecting data, it is important to decide on your test sample. The test sample
refers to which people and how many people from whom to collect primary data.

1.1. Who?

Decide who makes up your target population by thinking about the product or service
you are going to offer.

1.2. How many?

 This is known as the sample size and is influenced by how much time you
have and your budget.
 All the households in an area do not need to be interviewed to determine the
need for a product or service, but enough need to be interviewed to establish
the need.
1.3. Avoid bias
 Bias means your sampling is not valid and not completely objective.
 Do not interview only known positive or negative customers; interview a wide
range of people.

2. Observation

Collecting information by means of observation does not include interaction with the
sample population, but only watching what they do.

3. Interviews

There are several interview methods you can use, including:

• personal interviews

• telephonic interview

• postal surveys

• direct computer interviews

• email interviews.

The choice of interview method depends on various factors, such as:

• how soon you need the answers

• your available budget

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• the literacy levels of the target population

• the personal sensitivity of the questions.

3.1. Designing the questionnaire

 The questions should be clear and unambiguous.

 Do not ask too many questions. Start off with easy questions, working towards
more difficult ones.
 Work on a layout that is easy to complete.

3.2. Testing the questionnaire

Test the questionnaire on a small number of people, to make sure that people
understand all the questions, and that your questions are clear.

4. Protocol of conducting research

•The research protocol is the set of ‘rules’ you should keep in mind when doing
research.

•The appropriate way of approaching businesses or individual people need to be

used when doing interviews.

•This depends on the type of information you need.

4.1. Consent

The interviewee gives his or her permission that you can go ahead with the interview.
This is particularly important when children are interviewed.

Remember the following:

• Always start off by introducing yourself.

• State the purpose of the interview.

• Make sure the interviewee knows that his or her name will not be mentioned.

• If people do not want to answer questions, politely thank them and move on.

When conducting interviews at a company, remember the following:

• Approach management before you interview employees.

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•Make appointments with staff members you want to interview, and keep to the
appointments.

4.2. Basic ethics in research

 ‘Ethics refers to the morally right way to do something.

 It is unacceptable to spy on people who do not know that you are collecting
information from them.
 Sometimes people display the information that you need for all to see (like
wearing branded clothing) and if so, you are permitted to use it.

Unit 3: Business opportunities – needs and desires

Before an entrepreneur can establish a new business, he or she needs to:

• identify a gap in the market

• decide which products or services can be provided

• identify the target market

• identify the competition

• identify the suppliers.

TOPIC 3: Presentation of the business information

Unit 1: Business presentations

1. Developing a business presentation

The following questions need to be answered:

 What is the purpose?

 What information is important?
 Who is the audience?
 How long should the presentation last?
 What will be covered?
 What resources are necessary?
 What are the possible questions that the audience can ask?

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Create and do presentations – a step-by-step summary

Step 1: Define the purpose

Step 2: Gather content and presentation ideas

Step 3: Organize the subject matter

Step 4: Decide how to present it

Step 5: Prepare the presentation

Step 6: Practice, practice, practice

Step 7: Plan, experience and control the environment

Unit 2: Audio-visual aids

 Audio-visual aids include any device that uses sound or sight to communicate
ideas.
 Visual aids are useful in presentations for several reasons:

- People learn in different ways, engaging eyes and ears helps to get the message
across. Visual aids also help to keep an audience engaged during the presentation.

- Good visual aids are interesting, relevant and support the presentation, but never
overshadow it.

- Visual aids may include computer slide shows, transparencies, handouts, motion
picture and video clips.

1. Functions of audio-visual aids

•To enhance a presentation.

•To create excitement.

•To engage the audience.

•To help the audience to remember the presentation.

2. Visual aids – different types of charts

•Bar charts

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•Pie charts

•Run charts (line graphs)

•Scatter diagrams (show how closely two variables are related)

•Histograms (individual data points grouped together in classes)

•Diagrams (Used to show processes or relationships)

•Illustrations (pictures of what something will look like)

•Maps (Useful to orientate)

3. Design and layout of the visual aids for a presentation

The design of a presentation is vital for the success of the presentation. If visual aids
are going to be used consider the following points:

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  How formal or informal do you want to make the presentation?
 Which type of visuals will attract the audience and will they be able to
understand?
 Which heading should be used in your presentation?
 Should sub-headings be used?
 Plan how to create a good first impression.
 Keep language ability of your audience in mind.

Keep the following principles in mind to create the best layout:

 keep it simple; the simpler, the better
 avoid full sentences or paragraphs; just give a potent summary
 make sure that people at the back of the room can read the text
 avoid fancy decorations
 use black text on a light background; this is easier to read than white on black.

Topic 4: Business Plan

1. Analysis of environmental factors

 Pollution – air, water, soil or noise
 Natural resources such as electricity, water, fuel, minerals and agricultural
land
 Waste and management
 Impact of business activities on plants and animals
 Managing use of dangerous materials or chemicals such as oils, grease, fuel.
 Impact of business activities on the community
 Methods to lessen the impact of business activities on the environment.
2. Components of the business plan
2.1. Cover page
The cover page has to make a positive impression. It lists business details and
contact numbers:
 name of the business
 name(s) of owner(s) / entrepreneur(s)
 address and contact details of the business
 a picture of your business logo
 the date that the plan was prepared.
2.2. Contents page/ index
The index lists the headings of different sections with corresponding page numbers
that will help the reader to find information quickly.

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3. Executive summary
 The executive summary must get the attention of the reader.
 It summarizes your reason for writing the business plan.
4. Description of the business
4.1. Vision, mission and long-term objectives
 The vision of the business will be what the business wants to achieve.
 The mission statement is how the business is going to achieve its vision.
 Use smart objectives to set long-term objectives.
4.2. The structure of the business
 It is important to explain what form of ownership you decide on: sole
proprietorship, partnership, close corporation, private company, public
company.
 number of owners involved
 size and type of business
 how much control the owners want
 how much legal protection the owners want.
If the business is producing or selling a product, the business plan should include:
 a description of the product, what it looks like and what it can be used for.
 a picture, drawing or photograph of what the product looks like.
 an explanation of the manufacturing process if the product is made, including
where the business will get the raw materials or ingredients from.
If the business is providing a service, the business plan should include:
 an explanation of the service
 who will be using the service
 where you plan to provide the service.

4.3. The product / service

4.3.1 Industrial goods such as machinery used in the production process
4.3.2 Consumer goods
 convenience goods (such as bread and milk)
 shopping goods (clothing and furniture)
 specialty / select goods (cars).
4.3.3 Services
 personal (hairdressing)
 professional (doctor, lawyer, teacher)
 commercial or auxiliary (transport, insurance, grading, standardization,
storage).

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 4.4. Legal requirements of the business
 Most businesses need one or more permits and licenses to operate
legally.
 Sometimes businesses need only a basic business or occupational
license, while others, like a restaurant, may need several.
5. SWOT analysis (strengths, weakness, opportunity, threats)
 A SWOT analysis examines internal and external environments facing a
business.
 Strengths and weaknesses occur in the internal environment and include
the owners, products, services, brands and all other internal operations.
 Opportunities and threats occur in the external environment and are issues
that the business cannot control such as economic factors, social factors,
demographic factors, cultural factors, competition, and political trends.
6. Marketing plan
 The marketing plan explains how you will market your product or service.
 A study of customers and potential customers is necessary.
 The business needs to know how to advertise its products or services, as
this will tell the market about the new business and its products and
services.
6.1. Market research
 The business needs to know who they are going to sell to.
 The target market is the people who are most likely to buy the products or
services.
 The business needs to describe its target market by looking at age group,
personality profile, gender, income, education and specific preferences.
6.2. Marketing mix
 Once the target market is identified, the marketer works out a marketing
mix that best satisfies the needs of the target market.
 This is a combination of the 7 Ps:
1. Product
2. Price
3. Place
4. Promotion
5. People
6. Physical environment
7. Process.
7. Competition
 Businesses selling the same or a similar product satisfying the same need are
competitors.

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  Customers want value for money and will shop around to find the right product
at the best price with the best quality.
 To ensure competitive advantage, it is important to make a study of
competitors to find out what their weak and strong points are.
 Offer something extra or slightly better than they do.
 To be able to compete one does not always have to lower the price.
 The following can be done:
- use clever advertising slogans make your product unique
- provide attractive product displays offer an improved service.
8. Financial analysis
 The financial analysis describes financial needs of the business venture and
shows how funds will be used in the business.
 This information is important for financial institutions and potential investors
because they don't want to lose their money.
 The financial analysis will show:
- the sources of capital (own and borrowed money)
- a budget, projected income statement and projected balance sheet of
how the business plans to use the funds.
 A budget is a plan showing how money received is to be spent. It helps with
successful cash flow.
 A projected income statement shows the predicted profit or loss calculated by
taking into account income and expenditure.
 A projected balance sheet shows the predicted worth of the business by
calculating the possessions (assets like land and buildings, equipment,
vehicles, money in the bank) and money the business owes (liabilities like
loans, buying on account or bank overdrafts).

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