Business definitions Flashcards
1
Q
Advertising
A
any message that a firm pays for, which promotes the firm or its products
2
Q
Aim
A
an overall goal that a business is trying to achieve
3
Q
Apprenticeship
A
a method of training where someone works and learns about their trade at the same time, and is awarded a qualification once they have gained a certain level of skill
4
Q
ARR
A
the average rate of return on an investment
5
Q
Asset
A
a valuable item owned by a business, or money owed to the business
6
Q
Authority
A
power that people in an organisational structure have over the people in the layers below
7
Q
Automation
A
when a machine works by itself, with little or no human involvement
8
Q
Autonomy
A
where a worker is given the freedom to make their own decisions in a job
9
Q
Average unit cost
A
how much each product costs to make (calculated by dividing total costs by output)
10
Q
Award scheme
A
a method of motivation where employees are given recognition for hard work
11
Q
Bar gate stock graph
A
a graph that is used to manage a business’s stock levels
12
Q
Batch production
A
a method of production in which a firm makes one batch of identical items at one time
13
Q
Bonus
A
a lump sum added to an employee’s pay, usually once a year
14
Q
Boston Matrix
A
a method used to analyse a business’s product portfolio. Products are plotted according to their market share and how fast the market they are in is growing
15
Q
Brand image
A
the impression that customers have of a company or the products it sells
16
Q
Break-even level of output
A
the level of output at which a company’s total revenue equals its total costs
17
Q
Business plan
A
an outline of what a business will don and how it aims to do it
18
Q
Capital
A
a company’s wealth in the form of money or other assets
19
Q
Capital employed
A
the total amount of money into and out of the business
20
Q
Cash
A
the money a business can spend immediately
21
Q
Cash flow
A
the flow of money into and out of a business
22
Q
Cash inflow
A
money that flows into a business
23
Q
Cash outflow
A
money that flows out of a business
24
Q
Census
A
an official survey of a country’s population
25
Centralised organisation
an organisation with a structure in which all major decisions are made by one person or a few senior managers at the top of the organisational structure
26
Chain of command
the chain connecting directors to operatives in an organisational structure
27
Channel of distribution
the way that products get from manufacturer to a consumer
28
Commission
money paid to sales staff for every item they sell on top of their basic salary
29
Competitive pricing
a pricing strategy in which a firm charges similar prices to other firms
30
Competitor
a business which sells the same products in the same market as another business
31
Consumer
the person who uses a good or service
32
Contract of employment
a legal agreement between an employee and their employer about a job
33
Cost
an expense paid out to run a business
34
Cost-plus pricing
a pricing strategy in which the cost of making the product is increased by a certain percentage to work out the price the product will be sold for
35
Credit
an agreement that a customer will pay for something at a later date
36
Credit terms
the terms of a credit agreement that tell a customer how long they have to pay
37
Crowd funding
when a large number of people each contribute money towards funding a new business or a business idea
38
current asset
an asset that doesn't last very long
39
current liability
a debt that a business has to pay off soon
40
customer service
any interaction a business has with its customers
41
CV
a summary of a person's personal details, skills, qualifications and interests
42
decentralised organisation
an organisation with a structure in which the authority to make decisions is shared between people at different layers of the organisational structure
43
delayering
removing layers of management from an organisation
44
delegation
passing tasks or responsibilities onto another person
45
demand
how much of a product or service people will be willing to buy at a given price
46
depreciation
the amount of value that assets have lost over time due to wear and tear
47
design mix
the different elements of design needed to make a product successful including its function, cost and appearance
48
differentiation
making products or services distinctive in the market
49
dis-economy of sales
when growth leads to an increase in average unit cost
50
diversification
when two unrelated firms join together allowing them to move into new markets
51
dividend
a payment that a shareholders get if the company makes a profit
52
e-commerce
buying and selling products on the internet
53
e-tailor
a company that sells products online
54
economy of scales
a reduction in average unit cost that comes from producing on a large scale
55
enterprise
the process of identifying new business opportunities and then taking advantage of them
56
entreprenur
someone who takes on the risks of enterprise activity
57
exchange rate
a value that tells you how much one unit of a currency costs in a different country
58
extension strategy
an action intended to extend the life of a product
59
external expansion
when a company grows by merging with or taking over another firm (inorganic growth)
60
external recrutment
where a business recruits new people from outside the company
61
factor of prodution
a limited resource used to provide a good or service
62
fixed asset
an asset that a business keeps long-term or uses repeatably
63
fixed cost
a cost that doesn't vary with output
64
flat organisation structure
an organisational structure with very few layers
65
flexible working
when working hours and patterns are adapted to suit the employee
66
flow producion
a method of production in which all products are identical and are made as quickly as possible
67
formal training
a method of training which has a set plan with learning objectives and a schedule
68
franchise
where a company lets another firm sell its products or use its trademarks in return for a free or a percentage of the products
69
freelance contract
when a self-employed person is recruited by a company on a temporary basis usually to work on a specific project
70
fringe benefit
any reward for an employee that is not part of their regular income
71
full-time staff
employees that generally work 35-40 hours a week
72
gap in the market
a customer need that isn't being met
73
globalisation
the process by which businesses and countries around the world become more interconnected
74
government grant
a sum of money which is given by the government and does not have to be repaid
75
gross profit
the profit left over once the cost of sales has been taken away from the total revenue
76
gross profit margin
the fraction of every pound spent by customers that doesn't go towards making the product
77
hierarchical structure
an organisational structure with lots of layers
78
hire purchase
when a firm purchases something by first paying a deposit and then paying the rest in instalments over a period of time while they have use of the product
79
human resources
the people needed to run a business or the department that organise people in a firm
80
income statement
a financial statement that shows how the income of a business has changed over a period of time
81
incoporated
a business that has its own legal identity
82
induction training
a training program that introduces new employees to a workplace
83
inflation
an increase in the price of goods and services
84
informal training
a method of training which has no strict plan and is usually given by other workers
85
insolvency
when a firm is unable to pay its debts
86
interest rate
a value which shows the cost of borrowing money or the reward given for saving money
87
internal expansion
when a company grows by expanding its own activities
88
internal recruitment
where existing employees are recruited into new roles within a business
89
investment
money which is put into a business to make improvements in order to make the business more profitable
90
job analysis
a process in which every little detail of a job is thought thought about
91
job description
a written description of what a job involves
92
job enrichment
where a worker is given greater responsibility in their job
93
job production
a method of production in which each product has a unique design based on the customer specification
94
job rotation
where a worker is occasionally moved from one job to another
95
job share
where the work and pay of one full-time job is shared between two people
96
just-in-case
a method used in stock management in which buffer stock of items are kept at every stage of the production process
97
just-in-time
a method used in production or stock management in which stock levels are kept at a bare minimum - products are made just in time for delivery
98
lean production
a production strategy that aims to use as few resources as possible and to have as little waste as possible
99
limited liability
where the owners of a business are not legally responsible for all the debts a business has
100
liquidity
how easily an asset can be converted into money
101
loan
a long term source of money that must be paid back to the lender
102
logistics
getting goods or services from one part of the supply chain to another
103
long-term liability
a debt that a business has to pay off over a long period of time
104
loss
where the total costs for a company over a period of time are greater than its revenue
105
loss leader pricing
a pricing strategy in which the price of a product is set below cost
106
m-commerce
when goods and services are bought on the internet using a wireless mobile device such as a smartphone or tablet
107
margin of safety
the gap between current level of output and the break even level of output
108
market
a place where goods are traded between customers and suppliers, trade in a particular type of product or the potential customers of the product
109
market map
a diagram showing some of the features of the market
110
market research
when a business investigates different aspects of a market e.g. demand for a product, the competition and the target market
111
market share
the proportion of total sales within a market that is controlled by a business
112
market size
the number of individuals within a market that are potential buyers and sellers of products, or the total value of products in the market
113
marketing mix
the four elements that must be considered for good marketing:product, price, place and promotion
114
mass market
a large group of potential customers for a product
115
merger
when two companies join together to form a new lager firm
116
mortgage
a loan used to finance buying a property
117
multinational
a single business that operates in more than one country
118
net profit
the profit left over when all costs are taken into account
119
net profit margin
the fraction of every pound spent by customers that the company gets to keep
120
niche market
a small and specialised group of potential customers for a product
121
objective
a measurable step that a business will set in order to work towards an aim
122
obsolete
when a product is no longer used,usually because it has become out-dated and has been replaced by something else
123
off-the-job training
a method of training in which an employee learns away from their workplace
124
on-the-job training
a method of training in which an employee is shown how to do their job by another employee and then given the opportunity to practice
125
operating profit
the money left over after paying all the costs of running the business
126
opportunity cost
the value of something that's given up in order to do something else
127
organic growth
when a company grows by expanding its own activities (also called internal expansion)
128
outsourcing
when a business pays another firm to carry out tasks it could do itself
129
overdraft
when more money is taken out of a bank than has been paid into it
130
part-time staff
employees that generally work 10-30 hours per week
131
partnership
a business ownership structure in which a small number of people own an unincorporated company
132
performance review
a system for assessing an employees progress and helping them to develop
133
permanent contract
a contract of employment that has no end-date
134
person specification
a list of the qualifications, experience, skills and attitudes a person needs for a particular job
135
pressure group
an organisation that tries to influence what people think about a certain subject
136
price penetration
a pricing strategy in which a firm charges a very low price for a product when it is new
137
price skimming
a pricing strategy in which a firm charges a high price for a product to begin with
138
primary research
market research that involves getting information from customers or potential customers
139
private limited company
a business ownership structure that is incorporated and has shares, but the shares can only be sold with the agreement of all the shareholders
140
procurement
the act of finding and buying things that a business needs from outside the business
141
product life cycle
the different stages that a product goes through over time
142
product portfolio
the rage of different products that a business sells
143
productivity
how many products are made in a certain amount of time or for a certain amount of money
144
profit
the difference between revenue and cost over a period of time
145
promotion
when an employee is given a higher status or position within a firm
146
promotional mix
the combination of different promotional methods a firm uses to promote a product
147
promotional pricing
when products are put on offer so that their average unit price is reduced for a limited period of time
148
public limited company
a business ownership structure that is incorporated and has shares that can be bought and sold by anyone
149
public relations
business activities which involve communicating with the media in an attempt to promote a firm or its products tot he public
150
purchasing economy of scales
a reduction in average unit cost that comes from a firm being offered a lower unit cost from suppliers when it buys its supplies in bulk
151
qualitative information
information that involves people's feelings or opinions
152
quality assurance
a way of maintaining quality by checking that quality standards are being met throughout each process involved in making the product
153
quality control
a way of maintaining quality by checking products for faults at certain stages during the production process
154
quantitative information
information that can be measured or reduced to numbers
155
remote working
when an employee works in a location away from their employer's office
156
remuneration
payment to an employee for the work that they have done for an employer
157
retailer
a business that sells products to consumers
158
retained profit
profit that is put back into the business
159
revenue
the income earned by a business in a given time period
160
salary
a fixed payment that is made to employees every month
161
sales process
a series of steps for finding and selling to customers, as well as providing customer service
162
sales promotion
a short-term method used to boost a firm's sales e.g. 2 for 1
163
secondary research
market research that involves looking at data from outside the business
164
segmentation
when people within a market are divided into different groups
165
self-employed
when someone owns their own business and takes their income from the profits of the firm
166
self-learning
where and employee seeks out their own training and development
167
share
a unit of ownership in a company. owners of shares can share in the profits of the company
168
share capital
money gained through issuing shares in the company
169
sole trader
a business ownership structure where one person owns an unincorporated company
170
span of control
the number of workers who report to one manager in a heirachy
171
sponsorship
a method of promotion in which a business gives money to an organisation or event. in return the organisation or event displays the business's name
172
staff retention
when a business keeps all of its staff
173
stakeholder
any individual or group of people that is affected by a business
174
start-up capital
the money or assets needed to set up a business
175
statement of financial position
a financial statement that records a business's assets and liabilities at a particular moment in time
176
stock market
a market where shares of public limited companies can be bought and sold
177
subordinate
someone below another person in an organisational structure
178
supply chain
the group of firms that re involved in all various processes required to make a finished product or service available tot he customer
179
sustainability
working in way that doesn't damage the Earth for future generations
180
takeover
when an existing business expands by buying more than half the shares in another firm
181
tall organisational structure
a organisational hierarchy with lots of layers
182
tariff
a tax on goods that are being imported or exported
183
technical economies of scale
a reduction in average unit cost that comes from a firm being able to afford more advanced machinery or use larger premises than a smaller firm
184
telesales
selling products to consumers via phone
185
temporary contract
a contract of employment that is only for a fixed period of time
186
total cost
the fixed and variable costs for a business added together
187
total quality management
a strategy that aims to make quality the responsibility of every employee in an organisation
188
trade bloc
a group of countries that has few or no trade barriers between them
189
trade credit
when a business gives firms time to pay for certain purchases
190
unincoporated
a business that doesn't have its own legal identity
191
unique selling point
this is some feature that makes a product different from its competitors
192
unlimited liability
where the owners of a business are legally responsible for all debts a business has
193
variable cost
a cost that increases as a firm expands out
194
venture capital
money raised through selling shares to individuals or businesses who specialise in giving finance to new or expanding small firms
195
viral advertising
when adverts are shared and viewed many times ina short time period, often via social media
196
vocational qualification
a qualification that is specific to a certain job
197
wage
payment that is usually made to employees weekly or monthly
198
wholesaler
a business that buys products in bulk and stores them in a warehouse
199
working capital
the money available for the day-to-day operating of the business
200
zero hour contract
a contract of employment which means the employer doesn't have to offer the employee any work at all and the employee doesn't have to accept any work that is offered to them
