Edexcel GCSE

Business Studies

Revision guidance

Revision help

1. Paper 1 Check list – see following pages

2. Paper 1 Glossary of key terms to learn – see

following pages

3. Paper 3 Check list – see following pages

4. Paper 3 Glossary of key terms to learn – see

following pages

5. Specific revision guide:

http://www.pearsonschoolsandfecolleges.co.uk/Sec

ondary/Revision/Business-Studies/GCSE-business-

studies-revision.aspx

Available in school, price £2, from Mr Edmonds in

B1 at lunchtimes

6. Tutor2U revision presentation and Q&A materials at

http://www.tutor2u.net/blog/index.php/business-

studies/categories/C309

7. Edexcel past papers, marks schemes and examiner

reports at

http://www.edexcel.com/quals/gcse/gcse09/Busines

s/Business/Pages/default.aspx

GCSE Business Studies: content

Paper 1 content: Y10 Spotting a business opportunity

Topic What you need to learn Textbook

ref

Confident

about

Need to

learn/revise

Understanding

customer needs

Customer needs are

central to starting a business

Unit 2

how to collect and interpret primary and

secondary market research in the context of starting a new

business; the difference between qualitative and

quantitative research data

Unit 2

the value of market knowledge through direct customer contact

Unit 2

Market Mapping

how to analyse customer buying habits

and preferences

Unit 4

how businesses can

identify market segments

Unit 4

how businesses can map their market to set

out the key features of the market they are planning to operate in

and identify a market gap

Unit 4

Analysing that initial planning to Unit 6

competitor

strengths and weaknesses

set up a business will

require an analysis of the competitors in the market

how to analyse competitor strengths

and weaknesses and the comparing a

business offering with that of its rivals enables an entrepreneur to spot

further opportunities

Unit 6

Understanding

the need to add value

the meaning of the

term ‘added value’ and explain its importance

in business survival and success

Unit 7

the main sources of added value (convenience and

speed, branding, quality, design, unique

selling point)

Unit 7

What options

exist for starting up a business?

the principles of

franchising as it applies to small business start-ups

Unit 8

the advantages and disadvantages of using

a franchise as a means of starting a new

business and assess franchising against other business start-up

options

Unit 8

how to identify a

suitable start-up location

Unit 8

Showing Enterprise

Topic What you need to learn Textbook

ref

Confident

about

Need to

learn/revise

What is

enterprise?

that enterprise involves

taking risks, showing initiative, and a willingness to undertake

new ventures

Unit 1

the difference between

providing goods or a service

Unit 9

Thinking creatively

why thinking creatively is important in

Unit 10

developing both

competitive advantage and a new business

the role of lateral thinking and deliberate creativity in developing

new business ideas

Unit 11

What

questions do

entrepreneurs

ask?

the important questions

to ask when coming up with new business ideas

such as Why? Why not? What if?

Unit 1

and 9

the concept of looking beyond the obvious, asking ‘What if?’ and

judging the value of outcomes.

Unit 9

Invention and Innovation –

generating new business ideas

how new business ideas come about

Units 9 - 12

understand the difference between

innovation and invention and how

innovation means bringing a new idea to the market

Unit 12

explain steps an entrepreneur can take to

protect their ideas through patents and

copyright

Unit 12

Taking a

calculated risk

understand the principle

of taking a calculated risk

Unit 9

and 14

understand that weighing up the risks and the rewards of a

new business idea is an important part of the

process of judging outcome and viability of a start-up

Unit 9 and 14

to see mistakes as part of the process of

learning to succeed

Unit 9 and 14

Other

important enterprise

explain the importance

of planning, thinking ahead, seeing

Unit 15

skills opportunities, having

drive and determination

making connections,

using mind maps to collect thoughts and see opportunities

Unit 15

Putting a business idea into practice

Topic What you need to learn Textbook

ref

Confident

about

Need to

learn/revise

Objectives

when starting up

financial objectives: the

range of motives for wanting to start a

business including profit or income, financial security and wealth

Unit 23

non-financial objectives: personal satisfaction,

challenge, to help others (starting a charity)

Unit 23

The qualities

shown by

entrepreneurs

determination and initiative the willingness

to take risks and make decisions the ability to plan and persuade

showing leadership the role of luck in business

success/failure

Unit 15

Estimating

revenues, costs and profits

how businesses forecast

sales volumes and selling prices to estimate revenue

Unit 17

how to determine fixed and variable costs

Unit 18

understand the difference between price

and cost and the concept of profit

Unit 19

explain how profit is the difference between the

total revenue generated over a period and the total costs

Unit 19

the impact of profits and losses on a business and

its owners

Unit 19

Forecasting

cash flows

understand the role and

importance of cash to the operation of a

business and to its long-term success

Unit 20

how to estimate monthly Unit 21

cash inflows and

outflows to determine net and cumulative cash flows

how cash flows are affected by stock levels

and credit terms

Unit 21

explain how cash flow

problems can lead to business failure

(insolvency)

Unit 21

appreciate the role and

importance of a business plan in minimising the risk involved

Unit 21

Obtaining Start up

Finance

explain the main sources of finance for a small

business start-up

Unit 22

long-term sources, such

as loans, personal savings, profit, venture

capital and share capital in the context of a private limited company

Unit 22

short-term sources such as overdrafts and trade

credit

Unit 22

Making the start up effective

Topic What you need to learn Textbook

ref

Confident

about

Need to

learn/revise

Customer

Focus

understand that a

business must anticipate, identify and meet customer needs if

it is to be successful

Unit 25

The

marketing mix

understand that a

business will have to consider price, product,

promotion and place as important elements to meet the business

opportunity

Unit 25

understand that different

businesses will place different emphasis on

the elements of the mix and that the mix can be amended to meet

changing consumer needs

Unit 25

The

importance of limited liability

explain the principle of

limited and unlimited liability and understand the implications of this in

making a choice on the status of the business

Unit 26

the differences between sole trader and private

limited company status

Unit 26

Start-up legal

and tax issues

understand the need to

establish a unique trading and business name

Unit 27

understand the need to keep careful records, the

implications of VAT, income tax, National

Insurance and Corporation Tax for the business

Unit 27

Effective on-time delivery

and customer

satisfaction

explain how effective customer service

includes fulfilling customer orders

accurately and on-time and dealing with complaints

Unit 28

recognise the importance of

customer satisfaction in the success of a

business

Unit 28

the importance of repeat purchase for a business

Unit 3

Recruiting, training and motivating

staff

the basic processes involved in recruiting staff to work in a small

business

Unit 29

the importance of skill versus attitude when

recruiting and training staff

Unit 29, unit 30

understand the importance of treating staff fairly and a simple

understanding of the impact of relevant

legislation, e.g. relating to age, sex, race and

Unit 31

disability

discrimination Understanding the economic context

Topic What you need to learn Textbook

ref

Confident

about

Need to

learn/revise

Market demand and supply

the prices of commodity markets are determined by the balance between

supply and demand

Unit 33, unit 34

the difference between

commodity markets and normal markets

Unit 33,

unit 34

the effect on small firms of price changes in raw

materials and energy costs

Unit 33, unit 34

Impact of changes in interest

rates on small

businesses

how changing interest rates affect small firms which tend to rely on

overdrafts and loans for finance

Unit 35

the impact of changing

interest rates on consumer spending

Unit 35

Impact of changes in exchange

rates

explain what exchange rates are

Unit 36

how changes in the £/$

or £/€ affect small firms that trade abroad or face

competition from abroad

Unit 36

the impact of changing exchange rates on the

price of imported and exported goods

Unit 36

how to calculate exchange rates on

product prices

Unit 36

How do business

cycles affect small

businesses?

understand that economic activity tends

to rise and fall and that changes in the level of

economic activity can have serious effects on

small businesses

Unit 37, unit 38

What effect do business

that stakeholders are those groups or

Unit 39

decisions

have on stakeholders?

individuals with an

interest in a business

recognise that business decisions have different effects on different

stakeholders and the problems a business

may face in meeting the demands of all stakeholders

Unit 40

Grade boundaries on paper 1:

A* = 38-40 A = 36-37 B = 32-35 C = 29-31

D = 24-28 E = 19-23 F = 14-18 G = 9-13

To get a grade C you will need 75%!

Advice to candidates:

Multiple-choice format does not mean that the exam is ‘easier’. The questions are designed to require skills, including application and analysis

Key terms – a number of marks on this paper are gained through knowledge of key terms

Practice makes perfect

Timing –incorrect responses are often selected by candidates as a result of questions not being read thoroughly enough

Use the 45 minutes available to think carefully about each question, identify distracters, and finally identify the correct answer. Check all of your answers before the end of the exam. Candidates need to be aware that questions are designed to include some strong distracters

Candidates should note that when examination papers are

being produced they are designed to test the full range of ability. It should therefore be expected that candidates may find some questions more/less challenging than others.

GCSE Business Studies: Key terms: Paper 1

Key Term Definition Learnt

Primary Research First hand research, gathering information

direct from consumers, e.g. through

questionnaires; also known as field research

Secondary Research Research that has already been carried out or

published by another firm; also known as desk

research

Qualititative Research In-depth research to find out consumers views

and opinions

Quantitative Research Research which involves numerical data which

allows graphs to be drawn and data to be

analysed

Repeat Purchase Customer loyalty shown through continued

purchasing of a product

Effective Demand When the customer has the ability to pay for a

good or service

Market Map A grid that shows two different aspects of the

products or brands within a market; allows a

firm to identify a gap in the market

Market Research Finding out customer opinions and actions

through interviews, questionnaires etc

Innovative A new, perhaps original, product or process

Unethical An action or decision that is morally wrong

Market Segments Sections of a market in which consumers have

different characteristics, e.g. age, gender or

income

Market Share One brand’s sales as a percentage of the total

sales in a market

Adding Value Changing a product in some way to increase its

value to the customer, and allowing the firm to

charge a higher price

USP (Unique Selling Point) A feature of a product or service that is not

shared by any other product or service

Entrepreneur Person who takes the risk of starting their own

business

Royalty Payment An annual payment to a franchisor by a

franchisee for the use of the business name;

usually a percentage of the profits

Copyright A means of protecting the work of a person,

e.g. text, music etc

Patent A means of protecting a product, allowing sole

use; the product has to be registered

Innovation Putting a new idea into practice

Invention A new product, idea or process

Profit Total revenue minus total costs

Revenue The total value of sales; equals the number of

customers x the average amount they spend,

or price x number of items sold

Sales Forecast An estimate of the future level of sales

Fixed Costs Costs that do not change with the amount

produced, e.g. rent

Variable Costs Costs that do change with the amount

produced, e.g. raw materials

Total Costs Fixed costs added to variable costs; the total

costs of production

Business Plan A document that sets out a new business idea

and how it will succeed

Cash The money that a firm holds in notes and coins

in its tills together with the money in its bank

account

Cash Flow The flow of money in and out of a business

Cash Flow Forecast An estimate of future cash flows into and out of

a business

Insolvency A situation in which a business cannot repay its

short term debts

Liquidation Selling off a firm’s assets in order to raise cash

to pay off the firm’s debts

Dividends Annual payments to shareholders from the

company’s profits

Share Capital The finance raised from the sale of shares in a

limited company

Venture Capitalist An individual that invests in risky businesses, in

exchange for a percentage of the business

Limited Liability A situation in which the responsibility for

paying the debts of a business is limited to

amount invested in the business

Unlimited Liability A situation in which the responsibility for

paying the debts of a business is unlimited;

owner may be forced to sell personal assets to

pay the debts

Customer Focus Keeping your staff thinking about customers’

wants and needs

Target Audience (Market) The part of the market your product is aimed at

(e.g. women aged 15-24)

Sole Trader A business owned by one person; that person

makes all of the decisions and has unlimited

liability

Private Limited Company A business owned by shareholders who enjoy

limited liability; the shares cannot be sold on

the Stock Exchange

Corporation Tax A tax on the company’s profits

Income Tax A tax on peoples’ incomes

National Insurance A tax that is paid by both employers and

employees; it is a contribution towards welfare

benefits; it’s a percentage of the person’s

income

Customer Satisfaction The degree to which buyers approve of the

service they have received

Repeat Purchase Buyers returning regularly to the same supplier

Supply Chain (Chain of

Supply)

The links in the chain from the start to then

end of the supply process; e.g. from wheat

farmer to baker of bread to supermarket

Reference A letter to support a job application from

someone the job applicant has chosen

Discrimination Choosing one type of person in preference to

another, perhaps on the grounds of race, age

or gender

Curriculum Vitae A person’s life history, used to support a job

application

Induction Training Initial training for new staff, to make them feel

comfortable in their new job

Off-the-job Training Training that takes place away from the

workplace (e.g. at a college or training centre)

On-the-job Training Training that takes place while working at the

job (e.g. till training at a supermarket)

Labour Turnover The percentage of the workforce that leaves

each year and has to be replaced

Absenteeism The percentage of the workforce that is absent

on average each day

Consumer Spending The total spent by all shoppers throughout the

country

Exports Goods produced in one country but sold

overseas in another

Recession A downturn in sales and output throughout the

country, often leading to unemployment

Commodity A product in which all supplies are the same,

such as sugar.

Market Any place where buyers and sellers come

together, to agree a price and to exchange

Monopoly A situation in which sales in a market are

dominated by a single supplier

Wholesaler The middleman between producers and

retailers

Economic Growth The rate of increase in the total output of a

country

European Union The group of 27 countries in Europe that trade

freely with one another, and have agreed social

and economic policies

Foreign Exchange Markets The places where currencies are bought and

sold

Bank of England The state-owned bank that lends to the high

street banks such as Barclays, and sets interest

rates in the UK

Bank Rate The interest rate set by the Bank of England;

this forms the base from which high street

banks set their interest rates

Chancellor of the

Exchequer

The government minister responsible for

decisions about the economy; e.g. about

taxation and government spending set out in

an annual budget

Exchange Rate The price of one currency in terms of another

SPICED Strong pound, imports cheap, exports dear

WIDEC Weak pound, imports dear, exports cheap

Boom When an economy is growing faster than it

usually does; will not last, unemployment is

low

Forecast A prediction of future economic events

Stakeholders Groups of people who have an interest in and

are affected by a business, e.g. workers,

customers; NOT rivals!

GCSE Business Studies: Content

Paper 3 Content: Y11

Marketing

Topic What you need to learn

Textbook ref Confident about

Need to revise

Marketing and market research

the meaning of the term ‘marketing’

Unit 41

how to collect and interpret

quantitative and qualitative

research data to help decide on issues such as the

appropriate marketing mix

Unit 41

Product trial and repeat

purchase

the concept of breaking down

‘sales’ into product trial and repeat purchase and how

to maximise repeat purchase through

customer loyalty

Unit 42

Product life

cycle

the four phases of

the life cycle, extension strategies, cash

flow and the life cycle

Unit 43

Boston Box matrix

product portfolio analysis through

the Boston box

Unit 44

Branding and

differentiation

the importance of

brands as an aid to product trial and

Unit 45

repeat purchase

and the need to differentiate a

product/service from others, given

the level of competition

Building a successful

marketing mix

the importance of managing a brand

through the key variables that make up the mix:

Product, Price, Promotion and

Place

Unit 46

Meeting customer needs

Topic What you need to learn

Textbook ref Confident about

Need to revise

Design and research

development

design as a key approach to

product differentiation, be able to appreciate

the design mix and show the need for

scientific research to provide the basis for

development

Unit 48

Managing stock to interpret bar

gate stock graphs to see how stock

control should work in theory and understand the

need for the use of Just In Time (JIT)

stock control

Unit 49

the advantages

and drawbacks of different stock

control methods

Unit 49

Managing

Quality

quality control

versus a culture of quality assurance

Unit 50

Cost-effective keeping Unit 51

operations

and competitiveness

productivity up and

costs down to ensure low costs and allow for

competitive prices

Effective

customer service

providing

customers with the service level they

want, when they want it, and to see the link

with repeat purchase levels

Unit 52

the disadvantages

of poor customer service

Unit 52

Meeting consumer protection laws

a brief introduction to the purpose of Trade Descriptions

and Sale of Goods legislation and the

effects of this legislation on business

Unit 53

Effective Financial Management

Topic What you need to learn

Textbook ref Confident about

Need to revise

How to improve cash flow

key aspects of financial management such

as how to establish more favourable

credit terms with customers and suppliers and the

practice of de stocking

Unit 54

how to analyse the difference between

increasing cash inflows and reducing cash

outflows

Unit 54

How to improve

profit

cutting costs and

increasing revenues, and the

impact of price changes on profit

Unit 55

Break-even charts and

how to draw and interpret break-

Unit 56

break-even

analysis

even charts;

calculate the break-even point and

margin of safety

how changes to

price and costs affect the break-

even point

Unit 56

the value to a

business of using break-even analysis

Unit 56

Financing growth

how to finance a business from both

internal sources (profit, asset sales)

and external sources (share capital, debt),

including stock market flotation

Unit 57

Effective People Management

Topic What you need to

learn

Textbook ref Confident

about

Need to

revise

Organisational

structure

the importance of

divisional structure, levels of

hierarchy, chains of command, and centralised

versus decentralised

systems

Unit 58

Motivation

theory

the significance of

motivation in the workplace, with specific focus on

Maslow’s Hierarchy of Needs and its

potential in organisations

Unit 59

the idea that motivation comes from within

Unit 59

Communication the impact of insufficient or

excessive communication on

efficiency, the impact on staff and

Unit 60

their motivation

and the barriers to effective communication

Remuneration the impact on staff of various payment

strategies, including time,

piece rate, commission; full-time salary versus

freelance or temporary work;

fringe benefits

Unit 61

the impact on

business of different payment systems

Unit 61

The Wider World

Topic What you need to learn

Textbook ref Confident about

Need to revise

Ethics in business

the meaning of the term ‘ethics’ in business and the

complexity of moral issues

affecting organisations

Unit 62

possible trade-off between ethics and profit

Unit 62

the importance of the potential

effects of pressure group activity

Unit 62

Environmental issues

how businesses affect the

environment

Unit 63

the importance of short term

environmental effects (impact on

traffic congestion; air, noise and

water pollution; recycling) and long-term

environmental effects (global

warming and resource depletion)

Unit 63

Economic

issues affecting international trade

the extremes of

income distribution internationally

Unit 64

the effect of import

protection and export subsidy on

businesses

Unit 64

The impact of government and the EU

the impact of regulation and taxation and the

benefits and drawbacks of

minimum wage, maternity/paternity rights and health

and safety regulations on

businesses

Unit 65

GCSE Business Studies: paper 3 – Glossary

Key term Definition Learnt

Marketing The management process of identify, anticipating and satisfying consumer demand

Primary Research First hand research, direct from the consumer, for a specific purpose; also

known as field research

Secondary Research Information from second hand sources;

using data that has already been gathered for a different purpose; also known as desk research

Qualitative Research In-depth research using focus groups and in-depth interviews in order to find out

about consumers opinions and views

Quantitative

Research

Research that yields numerical data that can

be analysed and graphed

Socio-economic

group (ABC1C2DE)

Social class of customers; A/B =

professionals, E = unemployed, those on benefits and pensioners

Product Trial The consumer purchases the product for the first time

Repeat Purchase The consumer regularly purchases the product or brand

Brand Loyalty The consumer displays a long term

commitment to buy the brand

Product Life Cycle model

A business model which shows how the sales of a product decline with time, and identifies

stages in the life on the product

Extension Strategy A marketing action by a business to prolong

the sales of a product and prevent it going into decline

Boston Box Matrix A business model which groups the products of a business and shows which ones have the best prospects for the future

‘Stars’ Products that are in high growth markets but with a high market share

‘Problem Children’ Products that are in high growth markets but with a low market share

‘Cash Cows’ Products that are in slow growing markets but with a high market share

‘Dogs’ Products that are in a slow growing market with a low market share

Brand A product with a unique character, for instance in design or image; name given to

a family of products

USP (unique selling

point)

A key feature of a product that is not shared

by any of its rivals

Differentiation The process of making a product seem

different/distinct from its rivals

Logo A picture or symbol that represents a

business

Marketing Mix The 4P’s (price, place, product and

promotion); having the right product in the right place at the right price, and having promoted it so that consumers known about

it and have been persuaded to buy

Customer

Expectations

What consumers expect they are going to

receive for the service they have paid for

Design Mix The combination of economic manufacture

(cost), function and aesthetics (appearance) in each product

Patent A way of protecting a product, production method etc so that it cannot be copied for 20 years

Buffer Stock The minimum stock level held at all times to avoid running out

Stocks Items held by a business for use or sale, e.g. components for manufacturing, sellable

products for a retailer

Business Culture The way we do things around here; the

accepted attitudes and practices of staff at a workplace

Quality control Putting measures in place to check that the customer receives an acceptable level of

quality

Warranty The guarantee by the producer that it will

repair any faults in a product for a specific period of time

Productivity The efficiency of the worker, measured in output per worker per hour

Automated Processes that are fully carried out by machines rather than workers

Durability How strong a product is and therefore how well and long it lasts

Monopoly When there is only one supplier, i.e. there is no competition

JIT – just in time A system designed to reduce the amount of cash tied up in stock – firms buy raw

materials only when they are needed, and only produce goods to order, reducing storage costs

Profit The difference between revenue and costs

Revenue The total amount earned from sale of products; calculated by multiplying the number of items sold by the price

Break-even point The level of sales at which total costs = total revenue; the firm makes neither a profit nor

a loss; at output below this point the firm makes a loss; at output above this point the

firm makes a loss

Break-even chart A graph which shows total costs and total

revenue, and is used to find the break-even level of sales

Margin of Safety The positive difference between the firm’s actual sales and its break-even level of sales

External sources of finance

Sources of finance from outside the business, e.g. loans, venture capital

Internal sources of finance

Sources of finance from within the business, from the business’s own resources, e.g. sale of assets

Organisation chart A diagram that shows the internal structure of a business

Centralised Organisation

A business in which most decisions are made at head office

Decentralised Organisation

A business in which most decisions are made at a local level

Motivation The desire to work hard, to achieve the business’s goals

Communication The passing of information from one person to another

Barrier to communication

Something that prevents the flow of information

Internal communication

Communication that takes place between workers within the business

External Communication between the business and

Communication people outside of the business, e.g.

customers, suppliers

Remuneration The reward of employees, e.g. pay

Wage A method of paying employees for the work they do, usually by the hour, on a weekly

basis

Salary A method of paying employees for their

work, usually calculated on an annual basis, paid monthly

Commission A method of paying employees for their

work based on the number of items sold, or the value of items sold

Piece rate A method of paying employees for their

work based on the number of items produced

Time rate A method of paying employees for their work based on the number of hours worked

Ethics A set of moral principles

Ethical Doing what is morally right, not just what is

legal

Legislation Laws passed by parliament, e.g. the Sale of

Goods Act

Social Responsibility Acting in ways that show that the business

cares about all members of society, e.g. through recycling

Social enterprise A not-for-profit business that trades in order to benefit a social cause, e.g. Tradecraft

Pressure group A group with a common interest or goal who seek through their actions to change the behaviour of businesses

Fairtrade Movement A group that supports the suppliers of goods, especially farmers in developing

countries by making sure that they are paid a fair price (above the market price) for

their products

Scarcity Limited resources but unlimited wants and

needs

Quota A physical limit placed on imports

Subsidy A payment by the government to a business in order to reduce its costs so that is can compete with imports, or export more

cheaply

Tariff A tax placed on imported goods and services

Interest rate The charge imposed by banks for borrowing money (loan) and the reward to savers

Tax A financial charge set by the government, used to collect revenue for the government

in order to pay for government spending