GCSE Business Studies Revision: Internal and external stakeholders (With Mock Questions!)

Hello, brilliant students! 👋

Today, we’re tackling a key topic in GCSE Business Studies—Internal and External Stakeholders! Understanding who stakeholders are and how they impact a business is essential. Let’s break this down together, and get you ready for exam success! 😊💪

What are Internal and External Stakeholders? 🤔

Stakeholders are individuals or groups who have an interest in the success of a business. They can be directly involved in the business or affected by its operations.

Internal stakeholders are people who are part of the business, like employees, managers, and owners. These stakeholders are closely involved in the day-to-day operations and are directly impacted by the business’s success or failure.

External stakeholders, on the other hand, are outside the business but still affected by its actions. These include customers, suppliers, investors, and the local community.

Key Learning Items 📚

Here’s what you need to remember:

✅ Internal Stakeholders - These include employees, managers, and owners. Their main concerns are the health of the business, job security, and profitability.
✅ External Stakeholders - Customers, suppliers, the government, investors, and the local community are all external stakeholders. They care about things like product quality, fair prices, timely payments, and social responsibility.
✅ Conflicting Objectives - Internal and external stakeholders often have different goals. For example, owners may want higher profits, while employees seek higher wages. Similarly, customers want lower prices, while suppliers want higher prices.
✅ Influence on Business Decisions - Stakeholders can influence decisions in a variety of ways. For example, unhappy employees might lead to strikes, while dissatisfied customers can take their business elsewhere.
✅ Balancing Stakeholder Needs - Businesses need to manage and balance the demands of all stakeholders to ensure long-term success.

What You Need to Demonstrate 📝

For your exam, you should be able to:

✍️ Explain the difference between internal and external stakeholders.
✍️ Discuss the objectives of different stakeholders and how they can conflict with one another.
✍️ Understand how stakeholders influence business decisions.
✍️ Provide real-world examples of how businesses manage stakeholder interests effectively.

Key Things to Remember Before the Exam! 🧠

🔑 Know the Stakeholders - Be able to clearly define who the internal and external stakeholders are.
🔑 Conflicting Interests - Be ready to explain how the goals of different stakeholders can clash and why businesses need to manage these conflicts.
🔑 Real-Life Examples - Use examples of businesses balancing the needs of stakeholders, like improving working conditions or offering customer loyalty programs.
🔑 Stay Confident & Focused - Keep calm, answer clearly, and use key terms to show your understanding! 😊

Mock Questions for You! 🎯

Q1 - Which of the following is an internal stakeholder in a business?

a) Local community
b) Employees
c) Suppliers
d) Customers

Q2 - What is the main interest of external stakeholders like customers?

a) Maximizing profit for the business
b) High-quality products at affordable prices
c) Managing employees
d) Increasing staff salaries

Q3 - Which of the following could be a conflict between internal and external stakeholders?

a) Employees want higher wages, while owners want to keep costs down
b) Customers want lower prices, and suppliers want to raise prices
c) Managers and employees work together to improve sales
d) Suppliers want to deliver more products to the business

Q4 - Why is it important for a business to balance stakeholder needs?

a) To ensure the business makes decisions faster
b) To avoid conflict and ensure long-term success
c) To focus only on the needs of the shareholders
d) To prevent employee promotions

Q5 - Which of the following is an external stakeholder?

a) Managers
b) Investors
c) Employees
d) Owners

See more questions in our full Q&A Business Studies Booklet

You’re doing fantastic! Keep practicing and soon you’ll be a pro at explaining internal and external stakeholders. Stay confident, keep revising, and remember—you’ve got this! 🌟📚 Good luck, and keep up the amazing work! 🙌