Business Key Terms - Page 108 Flashcards
What is the marketing mix?
The ways businesses target different customer genres, such as price, product, promotion and place
What is a franchise?
When a business sells the right for someone to sell their product
What is an entrepreneur?
A person who takes calculated risks to start a new business venture
What is an intrapreneur?
A person who thinks creatively to improve conditions inside a business
What is blue skies thinking?
Deliberately creative thinking to help businesses improve
What is a supplier?
A business which sells (or supplies) products to another business
What is a customer?
Any person or organisation which buys or is supplied with a product by a business
What is a consumer?
The person who ultimately consumes the product
What are markets?
Where buyers and sellers meet to exchange goods and services
What is a survey?
Research involving asking questions of people or organisations
What are respondents?
Thos who provide data for a survey usually by answering questions or a questionnaire or a interview
What is a focus group?
In market research, a group of people brought together to discuss a product, brand or issue and to answer questions
What is qualitative data?
Information about opinions, judgements and attitudes
What is quantitive data?
Data that can be expressed as numbers and statistically analysed
What is secondary research?
The process of gathering data that has already been composed (eg. government stats, sales records etc.)
What is a market segment?
A part of a market that contains a group of buyers with similar buying habits, such as age or income
What does price sensitive mean?
When the price is very important in the decision of the buyer whether or not togged the product
What is market map?
A diagram that shows the range of possible positions for two features of a product, such as low to high price and low to high quality
What is a gap in the market?
Occurs when no business is currently serving the needs of customers for a particular product
Brand
A named product which customers see as being different from other products and which they can associate or identify with
Brand image
The idea/impression that customers have in their minds about the brand
Added value
The increased worth that a business creates for a product; it is the difference between what a business pays its suppliers and the price that it is able to charge for the product/service
Unique Selling Point (USP)
A characteristic of a product that makes it different from other similar products being sold in the market such as design, quality or image
Franchisee
A business that agrees to manufacture, distribute or provide a branded product, under licence by a franchisor
Franchisor
The business that gives franchisees the right to sell its product, in return for a fixed sum of money or a royalty payment
Enterprise
A willingness by an individual or a business to take risks, show initiative and undertake new ventures
Enterprises
Another word for businesses
Risk
The chance of damage or loss occurring as a result of making a decision
Goods
Physical, tangible products like a car, a pair of scissors or a television set
Services
Non-physical, intangible products like a taxi journey, haircut or a TV programme
Thinking creatively
Coming up with new and unique ideas
Competitive advantage
An advantage a business has that enables it to perform better than its rivals in the market and which is both distinctive and defensible
Deliberate creativity
The intentional creation of new ideas through recognised and accepted techniques
Lateral thinking
Thinking differently to try and find new and unexpected ideas
Blue skies thinking
A technique of creative thinking where participants are encouraged to think of as many ideas as possible about an issue or problem
Invention
The discovery of new processes and potential new products, typically after a period of research
Innovation
The process of bringing a new product to market (transforming an invention into a product that can be sold to customers)
Patent
The right of ownership of an invention or process when it is registered with the government
Copyright
Legal ownership of material such as books, music and films which prevents these being copied by others
Trademarks
The symbol, sign, or other features of a product or business that can be protected in law
Calculated risk
The probability of a negative event occurring
Mindmap
A diagram that is used to record words and ideas connected to aa central word or idea
Financial objectives
Targets expressed in money terms such as making a profit, earning income or building wealth
Revenues / Sales revenue / Turnover / Sales turnover
The amount of income received from selling dos or services over a period of time
Sales volume
The number of items or products or services sold by a business over a period of time
Insolvency
When a business can no longer pay its debts
Net cash flow
The receipts of a business minus its payments
Cumulative cash flow
The sum of cash that flows into a business over time
Business plan
A plan for the development of a business giving forecasts of items such as sales, costs and cash flow
Share
A part ownership of a business
Personal savings
Money that has been set aside and not spent by individuals and households
Venture capitalist
An individual or company that buy shares in what they hope will be a fast growing company, with the long term view of selling the shares at a profit
Loan
Borrowing a sum of money which has to be repaid with interest over a period of time
Security / Collateral
Assets owned used to guarantee repayments of a loan: if the loaner cannot pay off the loan, they just sell what they used as collateral to pay it off
Mortgage
A loan where property is used as collateral
Dividend
A share of the profits of a company received by shareholders
Retained profit
Profit that is kept back in the business and used to pay for investments within it
Leasing
Renting equipment or premises
Overdraft facility
Borrowing money from a bank by drawing more money than is actually in the current account. Interest is charged on the amount overdrawn
Marketing mix
The combination of factors which help the business to take into account customer needs when selling a product - usually summarised as the 4 Ps (Price, product, promotion, place
Price
The amount of money customers have to pay for a product
Product
A good or service produced by a business or organisation and made available to customers for consumption
Promotion
Communication between the business and the customer, making the customer aware that the product is for sale, telling them or explaining to them what the product is, and persuading them why they need it and therefore why they should buy it
Place
The way in which a product is distributed - how it gets from the producer to the consumer
Companies
Businesses whose shareholders have limited liability
Limited liability
What shareholders of a company are not personally liable for the debts of the company: the most they lose is their investment in the company
Unlimited liability
A legal obligation on the owner of a business to settle all debts of the business. In law, there is no distinction between what the business owner owes and owns and what they company owes and owns
Soe trader / Sole proprietor
The only owner of the business who has unlimited liability
Records
Evidence of what has happened in the past; records could be kept in paper form or in computer files for example
HMRC
Her Majesty’s Revenue and Customs: The government authorities in the UK responsible for collecting tax
VAT
Value Added Tax: A tax on the value of sales: it is paid by businesses to the government
Income Tax
A tax on the value of income earned by workers; this includes sole traders who have to pay income tax on their net earnings
National Insurance Contributions
A tax on the earnings of workers; Employers’ National Insurance contributions are paid by employers on the wages of their workers; employees and sole traders have to pay NICs on their earnings
Corporation Tax
A tax on the profits of limited companies
Customer service
The experience that a customer gets when dealing with a business and the extent to which that experience meets and exceeds customer needs and expectations
Customer satisfaction
A measure of how much products meet customers’ expectations
Repeat purchases / Repeat business
Orders or sales that occur from customers that have bought the product or service in the past
