Entrepreneur takes advantage of the postal strike

As the turkeys at the Royal Mail officially vote for Christmas, entrepreneurs are quick off the mark spotting opportunities to build a business from the Royal Mail’s dissatisfied customers.  Here is a terrific video which is packed full of full with key business studies terms - even though it only lasts just over a minute!

Rated: (5/5), based on 2 reviews

A dramatic fall in business investment

A significant piece of economic data yesterday that business students might consider as they develop their understanding of the business response to an economic slowdown…

Microsoft and Google compete head-to-head

A dramatic shake-up for the information-technology (IT) industry is coming.  Google is promising to release an operating system (like XP or Vista) for personal computers.  This represents a direct attack on Microsoft, the world’s biggest software firm. 

Spare capacity prompts a fall in business investment

The recession is creating a growing amount of spare productive capacity across many different markets and industries. From container ships to hotels and from steel plants to airlines, the fall in demand has lowered capacity utilisation and put a big squeeze on profits. That pressure on profit margins comes not just from weaker revenues. Keep in mind that many businesses have a large fixed cost component such as the overhead costs of operating a network. Thus when output is contracting, the average fixed costs of production increase.

Declining demand and rising productive slack inevitably cause a fall in planned investment spending - economists term this a negative accelerator effect. BBC news reports that British Airways is cutting capital spending in response to the slump in demand and mounting losses. “The airline said it had cut spending by 20% to £580m ($952m) from £725m, and had lengthened its schedule of orders for 12 Airbus A380 aircraft.”

Further evidence for the reverse accelerator affect comes from Japan where Japanese firms cut their capital spending by a record level in the first quarter of 2009. In contrast Stagecoach is increasing investment in a fleet of greener buses. 

Q&A - Outline the main costs and benefits of inflation

Inflation has many important costs and consequences for both society and business. However a stable and low level of inflation also provides some upsides for business.

Business strategy video - two interviews with CEO of Virgin Atlantic

Two video clips make ideal stimulus material for a business strategy lesson…

Q&A - Why are start-ups vulnerable to cash flow problems?

Start-ups and small businesses are especially vulnerable to cash flow problems. Here are some of the main reasons:

Q&A - How is profit used by a business?

Profit arises when total sales exceed total cost for a period. Once a profit has been made, the owners of the business have a choice:

M&S suffers a fall in profits and cuts dividend

M&S has released its latest trading results.  Reduced profits and cut in dividends are not good news for shareholders.

Q&A - What is meant by Social Enterprise?

One kind of business structure that has grown rapidly in the UK in recent years is the “social enterprise”. Social enterprises are the most common form of “not-for-profit” enterprises.