MODULE :MNE3701
,MNE3701 Exam Study Pack
Contains:
• Exam Study Notes
• Exam Questions & Answers
• Exam Memo Nov 2018 with Exam
Paper
,MNE3701 –EXAM PACK
Question 1&2 Overlaps
Explain the five steps in the Risk Management process (5)
1. Identify risks
Analysis of financial statements and firms operations, policy checklists…
2. Evaluate risks in terms of size and probability
critical, important and unimportant
3. Select methods to manage risk
risk control: risk avoidance – choosing not to engage in activities risk reduction –
lessening the severity of losses
risk financing: risk transfer – insurance or contractual agreements
risk retention – financing loss by itself
4. Implement decision
purchasing insurance or setting funds aside
5. Evaluate and review
new risks arise and old ones disappear
Discuss the steps in the Marketing research process (10)
1. Identifying the information need
venture’s informational needs to be correct and in detail, then marketing research
will produce meaningful results
ex. target market? Willing to pay? Disposable income? Geographic info? Quality?
2. Searching for secondary data
Secondary research is less expensive than primary research.
sources: Stats SA, Bureau for Marketing Research(Unisa), search engines
Shortcomings: outdated, may not fit requirements, credibility of sources.
3. Collecting primary data
Collected by means of observational and questioning methods.
important considerations: - differences between observational and questioning
method
the high value of personal observation in small business
considerations in questionnaire design:
o observation has 3 benefits – provides useful info, economical, avoids
potential bias
o surveys and experimentation are both examples of questioning methods
o four types of surveys – mail, telephone, personal interview or e-mail
o a questionnaire is the basic instrument for guiding the researcher and
respondent
4. Interpreting the data gathered
data must be transformed into usable information to make sound business decisions
Specialised computer programs are designed to summarise large quantities of data.
, Describe the approach that serves as guidelines in determining a promotional budget (4)
Allocating a percentage of sales
o Allocating a percentage of sales to promotion (ex. 30% of turnover)
o Disadvantage – when sales decline, less money is spent on promotion, which does not solve
the problem.
Deciding how much can be spared
o Spending whatever is left over on promotion after paying all expenses.
o Disadvantage – it ignores promotional goals, because different approaches to promotion are
required.
Spending as much as one’s competitors
o Business hopes to reach same customers by duplicating competitors promotional efforts
o Disadvantage – may result in copying of competitors mistakes
Determining what it will take to do the job
o Based on proper market analysis and all the alternatives available as promotional channels
o Preferred approach to promotional expenditure.
o Disadvantage – very time consuming and requires a greater understanding.
Explain the five key factors that must be considered when choosing the location of a business (10)
1. Customer accessibility
Retail outlets and service firms are businesses that must be located to make access
easy.
2. Business environment conditions
Weather, competition, crime, legal requirements and tax structures.
3. Resource availability
Proximity(nearness) to raw materials, suitability of labour supply, availability of
transport
4. Entrepreneur’s personal preferences
Choice of local site or location offering unique lifestyle advantage
5. Site availability and costs
Either close to the customer (retail) or the supplier (supplier of intermediate goods)
leasing a site is advisable because a large cash outlay is avoided and thus reduces
risk
,MNE3701 Exam Study Pack
Contains:
• Exam Study Notes
• Exam Questions & Answers
• Exam Memo Nov 2018 with Exam
Paper
,MNE3701 –EXAM PACK
Question 1&2 Overlaps
Explain the five steps in the Risk Management process (5)
1. Identify risks
Analysis of financial statements and firms operations, policy checklists…
2. Evaluate risks in terms of size and probability
critical, important and unimportant
3. Select methods to manage risk
risk control: risk avoidance – choosing not to engage in activities risk reduction –
lessening the severity of losses
risk financing: risk transfer – insurance or contractual agreements
risk retention – financing loss by itself
4. Implement decision
purchasing insurance or setting funds aside
5. Evaluate and review
new risks arise and old ones disappear
Discuss the steps in the Marketing research process (10)
1. Identifying the information need
venture’s informational needs to be correct and in detail, then marketing research
will produce meaningful results
ex. target market? Willing to pay? Disposable income? Geographic info? Quality?
2. Searching for secondary data
Secondary research is less expensive than primary research.
sources: Stats SA, Bureau for Marketing Research(Unisa), search engines
Shortcomings: outdated, may not fit requirements, credibility of sources.
3. Collecting primary data
Collected by means of observational and questioning methods.
important considerations: - differences between observational and questioning
method
the high value of personal observation in small business
considerations in questionnaire design:
o observation has 3 benefits – provides useful info, economical, avoids
potential bias
o surveys and experimentation are both examples of questioning methods
o four types of surveys – mail, telephone, personal interview or e-mail
o a questionnaire is the basic instrument for guiding the researcher and
respondent
4. Interpreting the data gathered
data must be transformed into usable information to make sound business decisions
Specialised computer programs are designed to summarise large quantities of data.
, Describe the approach that serves as guidelines in determining a promotional budget (4)
Allocating a percentage of sales
o Allocating a percentage of sales to promotion (ex. 30% of turnover)
o Disadvantage – when sales decline, less money is spent on promotion, which does not solve
the problem.
Deciding how much can be spared
o Spending whatever is left over on promotion after paying all expenses.
o Disadvantage – it ignores promotional goals, because different approaches to promotion are
required.
Spending as much as one’s competitors
o Business hopes to reach same customers by duplicating competitors promotional efforts
o Disadvantage – may result in copying of competitors mistakes
Determining what it will take to do the job
o Based on proper market analysis and all the alternatives available as promotional channels
o Preferred approach to promotional expenditure.
o Disadvantage – very time consuming and requires a greater understanding.
Explain the five key factors that must be considered when choosing the location of a business (10)
1. Customer accessibility
Retail outlets and service firms are businesses that must be located to make access
easy.
2. Business environment conditions
Weather, competition, crime, legal requirements and tax structures.
3. Resource availability
Proximity(nearness) to raw materials, suitability of labour supply, availability of
transport
4. Entrepreneur’s personal preferences
Choice of local site or location offering unique lifestyle advantage
5. Site availability and costs
Either close to the customer (retail) or the supplier (supplier of intermediate goods)
leasing a site is advisable because a large cash outlay is avoided and thus reduces
risk
