Business key words Flashcards
1
Q
what is absenteeism
A
measures the rate of workforce absence as a proportion of the employee total
2
Q
ACAS
A
Advisory Conciliation Arbitration Service
3
Q
Accountability
A
the extent to which an individual is held responsible for the success or failure of a policy
4
Q
Added value
A
the finished output over and above the cost of achieving it i.e. the cost of inputs and transformations
5
Q
adverse variance
A
where the difference between budgeted and actual has a negative impact upon profit
6
Q
Aims
A
long-term plans of the business from which is corporate objectives are derived
7
Q
Alignment of values
A
the identification of core values that are central to decision making at all levels of the hierarchy
8
Q
alliances
A
a method of entering international markets by forming partnerships with one or more businesses operating in another country
9
Q
Ansoff matrix
A
considers the degree of risk and potential for reward from different growth/ strategic options
10
Q
Anti-competition practices
A
where a firm in a dominant market position uses its powers to restrict or eliminate competition
11
Q
Appraisal system
A
the process of assessing the effectiveness of an employee
12
Q
Arbitration
A
resolving a dispute by appointing an independent person to judge the appropriate outcome
13
Q
Asset
A
item owned by the business, provides a flow of benefits to the organisation over a certain time period.
14
Q
Authority
A
the ability to give instruction, shape decisions and influence the people and actions of the organisation
15
Q
autocratic leadership
A
the leader makes all the decisions and informs subordinates
16
Q
Automation
A
using machinery to replace human labour
17
Q
autonomy
A
giving employees the power to make decisions for themselves
18
Q
Average rate of return
A
calculates average profit as a % of the cost of the initial investment
19
Q
Average (unit) costs
A
the average cost of producing a single unit of output
20
Q
B2B
A
business to business
21
Q
B2C
A
Business to consumer
22
Q
Balance sheet
A
statement of a firm’s assets and liabilities at a moment in time
23
Q
Barrier to entry
A
an obstacle put in the way of new firms entering a market
23
Q
Behavioural segmentation
A
characterises groups of customers according to the way that they act when making purchasing decisions
24
Benchmarking
setting competitive performance standards against those which performance can be measured.
25
Big data
large volumes of facts and figures that can now be assessed as a result
26
Boston matrix
a model used to analyse a business' product portfolio by considering market share in relation to market growth
26
BOGOF
buy one get one free
27
brand loyalty
the degree or level of attachment that a consumer has to a given brand
28
branding
a promotional method that involves the creation of an identity for the business that distinguishes the business and its products from its competitors
28
break-even chart
a visual representation of total costs and total revenues identifying the point at which breakeven is achieved
29
Break-even point
the number of units necessary to achieve an equilibrium where TR = TC
30
budgeting
financial plans that forecast revenue from sales and expected costs over a period of time
30
CAD- computer aided design
the use of computer-based software to aid in design processes
30
Buffer stock
what goods you hold just in case
31
business forms
the form of business is the legal structure of a business such as sole traders, PLC, partnerships, LTD
31
business objectives
businesses may set themselves a number of objectives including profits and profit maximisation, growth, survival, cash flow and social and ethical objectives
32
CAM- computer aided manufacturing
the use of software and computer- controlled machinery to automate a manufacturing process.
32
capacity
the maximum output level a company can sustain to provide its products or services
33
capacity utilisation
a measure of the % of the potential output that is actually being used
33
capital
funds invested in the firm
34
capital expenditure
spending on non-current assets e.g. machinery
34
capital intensive
production depends more on capital than labour
35
capital structure
how the firm has arranged its long-term funding between share capital and non-current liabilities/loans
36
cash cow
a product with a high market share and low market growth
37
cash flow
the movement of cash into and out of a business over a period of time
38
cash flow forecast
process of estimating the size and timing if cash inflows and cash outflows
39
centralisation
responsibility for decision making is maintained by a limited number of senior managers at the top of the hierarchy
40
chain if command
the way authority is passed down the levels of the hierarchy
41
charities
non profit organisations with an aim to support a specific cause or benefit for the well being of society
41
collateral
security offered to back up a loan request
41
collective bargaining
where trade unions negotiate with management on behalf of employees
42
competition
the number and relative power of all business competing in a market
43
confidence intervals
where a specific probability can be given that a sampling outcome will fall between two points
43
complementary goods
goods that compliment each other, such as cars and tyres
43
competitive advantage
an aspect of a business that enables it to withstand competition
43
conciliation
attempt to get both parties in a dispute to reconcile
44
confidence levels
measurement of the degree of certainty to be attached to a conclusion drawn from a sample finding
45
conglomerate integration
integration between firms that have no clear connection with each other's business, either horizontally or vertically
45
consumer goods
products purchased by individuals ready for immediate consumption by themselves or others
45
consultation
asking for the views of those who will be affected by a decision
46
contingency planning
the process by which firm's try to prepare for unexpected and potentially disastrous events
46
continuous improvement
or Kaizen- a lean production technique that concentrates on small but frequent improvements in every aspect of the production process
47
consumer profiles
a quantified picture of a firm's customers
48
contribution
total revenue minus Variable costs. it measure the amount each product contributes towards the fixed costs of the business
49
contribution per unit
selling prie minus variable cost per unit. how much does each unit contribute towards fixed costs and once breakeven has been achieved then contributes towards profit
50
copyright
a legal protection for anyone that had produced work in areas such as - literature, drama, music, art, etc..
51
core competencies
the capabilities, knowledge, skills and resources that constitute its "defining strength" A company's core competency is distinct, and therefore not easily replicated by other organisations, whether they're existing competitors or new entrants into its market
52
corporate culture
the attitudes and behaviours of staff that are the norm within a business
52
corporate culture
the attitudes and behaviours of staff that are the norm within a business
52
corporate governance
the formal policies and procedures that are instrumental in the running of a business
53
corporate image
the view of a company held by its customers, employees and the public at large
54
corporate objectives
the SMART goals for the whole organisation
55
corporate social responsibility
a business' decision to accept responsibility to its stakeholders for its social, environmental and ethical obligations
55
correlation
identifying the strength and existence of a relationship between two variables
55
cost of sales
the direct costs that can be attributed to the sales revenue in a particular time period
55
credit
acquiring goods without paying for them straight away
56
creditors
those to whom a business owes money
57
critical path
the sequence of activities, shown on a network diagram, that will lengthen the duration of the project if delayed.
58
crowdfunding
a venture is funded by raising small amounts of money from lots of people over the internet
59
current assets
items owned by the business that are likely to be turned unto cash within the year
59
current liabilities
items owed by the business that are due to be paid within the year
60
current ratio
a measure of a firm's ability to pay its short term debts- formular is Current assets: current liabilities
61
customer service
the ability of a business to meet the needs of actual/ potential customers before, during and after sales.
62
Data
facts of any kind, whether in numerical form
63
data mining
the process of manipulating and analysing big data to inform decision making
64
debt capital
borrowed capital, interest paying debt, long term loans
64
debentures
a fixed interest, long term loan secured on property
65
debt to equity ratio
the extent to which a firm is reliant on borrowed capital as opposed to equity
65
debt factoring
a source of finance where a business receives a proportion of the amount owned by trade debtors from a specialist finance-provider
66
debtors
people who owe the firm money following credit sales
67
decentralisation
entails passing authority from the centre of an organisation to those working elsewhere in the business
68
decision trees
a quantifiable model that visually presents the alternative courses of action when making a decision
69
delayering
a method used to improve competitiveness by removing levels if the hierarchy. communication should be improved and costs lowered
70
delegation
the passing of authority down the hierarchy from a superior to a subordinate
71
demand
the amount of goods/services that customers are willing and able to buy, at a given price, over a period of time
72
democratic leadership
a leadership style where leaders consult with employees prior to making decisions
73
demographics
data about the human population to show information such as age, gender, education, income and ethnicity
74
depreciation
loss in value of a non current asset due to age, wear and tear, technical obsolescence
75
desk research
secondary research- finding out information from already published sources i.e. second hand data
76
differentiation
extent to which consumers perceive one product as being different from its rivals
76
digital marketing
marketing activities that make use of technology, including all types of digital media
77
direct costs
costs that can be directly attributed to a particular product
78
direct selling
selling direct to the consumer without using a retailer/outlet
79
discount factor
the adjustment that must be applied to an estimated future cash flow to convert it to its present value
80
diseconomies of scale
factors that cause unit costs to increase as output increases.
81
disruptive innovation
this refers to the innovation that transforms expensive or highly sophisticated products or services- previously accessible to a high-end or more-skilled segment of consumers- to those that are more affordable and accessible to a broader population. this transformation disrupts the market by displacing long-standing, established competitors.
82
distribution channels
the route taken by a product from producer to end consumer
83
diversification
diversification is an objective where a firm produces an increased range of unrelated goods and services
84
dividends
a percentage of profit paid to shareholders as a reward for their investment
85
division of labour
division of labour is the breaking down of production into a series of small tasks carried out repetitively by relatively unskilled employees.
86
dogs
products with a relatively low share of a slow-growth market.
87
Dominant market position
a company which holds a dominant market position has the capability to work independently from its competitors and customers. a dominant position can allow a company to set prices above the competitive level for products which are not of as high quality, and in effect it can restrict competition.
88
dynamic pricing
on occurrence which happens when prices are changing rapidly in response to changing demand conditions
89
early adopters
the term refers to an individual or business who uses a new product, innovation or technology before others
90
E-commerce
electronic commerce involves the buying and selling of goods or services online
91
economic environment
the key economic factors that influence the behaviour of businesses and their customers
92
economic growth
describes how real incomes per head increase over time
93
economies of scale
the factors that cause unit cost to fall as output increases
94
economies of scope
the advantages enjoyed by a business as it increases the scale of its operations by expanding the range of activities it undertakes leading to a fall in unit costs
95
efficiency
using resources effectively- gaining maximum output from minimum input
96
emergent strategy
a type of corporate strategy that is developed over time in response to internal and external changes
97
emerging market
countries with low income levels but high growth rates
98
employee representation
systems that are put in place to aid effective communication between employers and employees
99
employee engagement
the degree of commitment and enthusiasm shown by an employee towards working with the business to achieve its goals
100
employment tribunal
an informal courtroom where disputes between employees and employers can be settled
101
empowerment
delegating power to employees so that they can make their own decisions
101
enterprise resource planning (ERP)
management software that enables greater integration between all functional areas of a business
102
entrepreneur
a person who undertakes the risk of starting a new business venture
103
equity capital
another name for share capital plus retained profits
103
ethics
morals in decision making, doing what it is 'right'
104
exceptional items
an entry in the income statement which arises from ordinary activities but which is so large or unusual, it is listed separately so as not to distort the overall figures
105
expected value
the weighted average of the predicted financial outcomes of a decision based on the probability of each outcome occuring
105
exchange rates
the value of one company in terms of another
105
Expenditure budget
a target amount of money a business/function is allowed to spend in a given time period
106
external recruitment
appointing someone from outside the business
106
extension strategy
a strategy that is used to extend the lifetime of a product
106
external growth
growth that comes from outside the firm, such as acquiring or merging with another firm
106
extraordinary items
an entry in the income statement which does not arise from ordinary activities and are not expected to reoccur, it is listed separately so as not to distort the overall figures
107
external environment
all the factors that influence the running of a business but fall outside the business' direct control
108
extrapolation
forecasting the future using past data to identify trends
108
fair trade
the producer has met specific criteria to ensure smaller scale farmers/workers in developing countries receive a fair price for goods received
108
field research/ primary market research
the process of gathering date on buying habits, lifestyle, usage and attitudes of actual and potential customers in person
108
financial incentives
financial mean used to motivate a workforce
109
favourable variance
difference between actual and budgeted results which is good news i.e. has a positive impact on profit
109
fist mover advantage
use of taxation and government spending to influence aggregate demand and supply in the economy
109
flat organisation
management structure with a wide span of control requiring relatively few layers of hierarchy
109
fixed costs
costs that do no change with the level of output in the short term
109
forecasting
estimating future outcome
109
fiscal policy
costs that stay the same regardless of output in the short run
110
franchisor
the owner of a business format (franchise) which is licensed out to other people or businesses (franchisees)
110
focus groups
a market research method which involves a small number of people gathered to discuss a specific issue/topic
110
flexible working
where a business uses a number of different working practices in order to suit the job in hand and the needs of employees (e.g. part-time-, job sharing, homeworking, annualised hours contracts.)
110
franchise
where the owner of the business. the franchisor sells the right to use the product to another, the franchisee
110
franchisee
the person or company which operates a franchised business format- under licence from a franchisor
110
free trade
where there is trade between countries without barriers such as quotas and tariffs
111
functional decisions
decisions made in one of the four functional areas
111
gearing
ratio that focuses on the long-term financial stability and capital structure of a business. the gearing ratio measures the proportion of assets in a business that are financed by borrowing
112
geographic segmentation
segmenting a market according to the consumers' location e.g. by region or country
112
GDP- gross domestic profit
measure of economic activity i.e. the total value of a country's output in a year
113
globalisation
process by which regional economies, societies, and cultures have become integrated through a globe-spanning network of communication and business activities
114
gross profit margin
% of sales revenue that is gross profit
114
Handy's models of culture
a theory that outlines four types of culture: power, task, role and person
114
government policy
government policy is a declaration of government political activities, plans and intentions relating to a particular cause
114
gross profit
sales revenue minus cost of sales
115
gross domestic product
the sum total of the value of a country's output over the course of a year
116
Hard HR
an approach to HRM based on treating employees as resources in the same way as any other business resource
116
Herzberg F
developed the Two Factor Theory
116
Hawthorne effect
the beneficial impact on staff work rate and morale of an active, personal interest being shown by management
116
Hierarchy
the management structure of an organisation and when presented on a diagram shows who is accountable to whom
117
Hierarchy of needs
a motivational theory comprising a five-tier model of human needs. from the bottom of the hierarchy upwards, the needs are physiological (food and clothing), safety (job security), love and belonging needs (friendship), esteem, and self-actualisation. needs lower down the hierarchy must be satisfied before individuals can attend to their higher needs.
118
impoverished leadership
a leadership style that has a low concern for a production and a low concern for people
118
income statement
shows the revenues, costs and profits of a business for a given period of time
118
income elasticity
a measure of the sensitivity of quantity demand of a product to changes in income
118
horizontal integration
two or more businesses that join through merger or takeover and operate at the same stage of the production process
118
impulse buying
an unplanned decision to but a product or brand
118
index numbers
convenient way of showing changes in a data set over time
119
industrial action
measure taken by a workforce that will halt or slow output in order to put pressure on management during an industrial dispute
119
induction training
training aimed at introducing new employees to a business and its procedures
119
industrial disputes
a disagreement between management and a trade union representing the views of the workforce
119
industrial relations
the atmosphere prevailing between a management and its workforce representatives
119
inelastic demand
a product has low sensitivity to a change in price
120
indirect costs
costs that are not directly related to a product e.g. general maintenance
121
inferior goods
a product whose demand rises when income falls and vice versa
121
intangible assets
assets that do not have a physical existence e.g. brands
121
infrastructure
road, rail, air, telephone, internet, sewage and other basic utilities which provide a network that benefit business and the community
122
innovation
bringing new ideas into being, can be product or process innovation
122
inflation
a rise in the average level of prices in an economy
123
internal recruitment
where new employees are recruited from within the business
123
intellectual property
derive from the invention or ownership of patents, trade-marks, logos, copyright.
123
inventories
materials and goods required in order to produce for, and supply to, the customer. three main types are raw materials, work in progress and finished goods.
123
interest rates
the price of money i.e. the cost of borrowing or the reward for saving
124
intrapreneurship
giving employees in a large organisation the freedom n
and resources to behave like entrepreneurs
124
inventory control
the procedures needed to ensure that inventories are ordered, delivered and handled with efficiency so that customer demand can be met cost effectively
124
investment criteria
a predetermined set of guidelines against which a capital investment can be judged
124
inventory turnover
measures the speed with which the firm sells and replenishes its inventories
124
investment appraisal
techniques used to assess whether a capital investment should be undertaken or not i.e. is the investment financially viable
124
job description
a detailed statement of the nature of a job, identifying the precise task and responsibilities involved
125
job enlargement
the process of increasing the number rather than the level of tasks that the employee is responsible for
125
job design
deciding the way in which job roles and tasks are allocated in the workplace
125
job rotation
to prevent tedium and boredom workers are switched around a number if work tasks
125
job enrichment
the process of increasing the level of responsibility that an employee has in order to increase motivation
125
Just in time
a lean production technique which has the aim of minimising inventory holdings at each stage of the production process
125
job security
the extent to which the job is or seems to be guaranteed for the foreseeable future
126
joint ventures
two or more businesses set up a business that is to be operated jointly. this avoids the need for a complete merger
127
Kaizen- or continuous improvement-
a lean production technique that concentrates on small but frequent improvements in every aspect of the production process
127
labour cost per unit
the costs associated with employing workers expressed as a cost per unit of output
127
labour intensive
when production uses a relatively high proportion of labour as opposed to machinery
127
labour or employee retention
number/percentage of staff that remain in the business at the end of the year
127
labour productivity
a measure of the output per worker
128
labour turnover
measure of the rate at which employees are leaving the organisation
128
Laissez-faire leadership
a leadership style that allows employees large amount of, or total, autonomy in decision making
129
liabilities
a debt that the business owes
129
lean production
range of waste saving measures inspired of Japanese manufacturing firms i.e. just in time, Kaizen
129
leasing
a way of acquiring a property for a restrict period of time without the need for the initial capital outlay implied by purchasing
129
lead times
time between order and delivery
129
Lewin's force field analysis
a model that indicates how change can be implemented by increasing the driving forces and reducing the restraining forces
130
limited liability
an investors financial commitment is limited to the total amount invested in share capital
131
management styles
the way in which a manager interacts with its employees
131
loan capital
medium to long term finance, typically acquired from loans
131
margin of safety
the positive difference between actual number of units produced and the number of units required to breakeven
131
liquidity
a measure of a business' ability to pay its short term debts
131
loss leader
items sold at or below cost in the hope of generating other peoples profitable sales
132
luxury goods
items that have an image of quality and high brand recognition and are sensitive to changes in income levels
132
margin of safety
the positive difference between actual number of units produced and the number of units required to breakeven
132
market capitalisation
the value the stock market places on a business based on the total value of shares issued
132
market conditions
the characteristics of the market in which the business operates including the degree of competition in the market and the growth rate of the market
133
market development
a marketing strategy that involves selling an existing product to a new market
134
market growth
the % increase in the size of the market measured in value or volume
134
market mapping
the process of positioning competition within a market by plotting the key variables that differentiate products within the market from each other
134
market penetration
a marketing strategy where firms aim to sell more of their existing products in existing markets
134
market positioning
where a business positions a brand within a marketplace, in terms of image, pricing and distribution
134
market research
the process of gathering primary and secondary data on the buying habits, lifestyle, usage and attitudes of actual and potential customers
134
market segmentation
analysing a market to identify different types of consumer. this can be done demographically, geographically and psychographically
135
market share
the proportion of total market sales that a particular business has
135
market size
the total value or volume of sales within the market
135
marketing mix
the main variables through which a firm carries out its marketing strategy. also known as the seven Ps
135
mark-up
the % profit added to the direct cost of a product
135
Maslow A
motivation theorist that is best know for the hierarchy of needs
135
mass customisation
where a business employs flexibility, providing tailor made or customer specific products into a mass production line
136
mass marketing
targeting a firm's promotional spending at the whole market and not just a particular segment
137
meaningful work
describes a job where workers feel fulfilled and valuable- where their day-to-day efforts are both appreciated and connected to something that transcends their personal interests
137
mechanistic structure
a formal structure that is based around clearly defined policies and procedures
137
merchandising
merchandising is the presentation and promotion of goods that are available for purchase for both wholesale and retail sales
138
mergers
an agreement between two companies to come together under a common board of directors
138
migration
the movement of people between countries
138
mission statement
sets out a business' overall purpose to direct and stimulate the entire organisation
138
monetary policy
concerned with the money supply, rates of interest, exchange rates and the amount of credit available, in order to control the level of spending with an economy
139
monopoly
in theory is a single producer within a market
139
motivation
the reasons why people behave as they do
140
multi channel distribution
linked to the seven Ps- place and the various routes that businesses can take to get to the market
140
multinational business
a firm that has bases (manufacturing, assembly) in more than one country
140
mutuals
non profit organisations that operate for the well being of their members
140
necessity
a product that is essential and customers will continue to purchase when prices are high or incomes low
140
net gain
the value that a business will gain from taking a particular decision as shown on a decision tree
141
net present value
the total return on an investment taking into account the time value of money
142
network analysis
a technique used to identify tasks that can be completed simultaneously when planning a complex project in order to complete it in the shortest time possible
142
niche marketing
targeting a small segment of a larger market
142
no strike agreements
an agreement between a firm and the union that in the event of disagreements which cannot be resolved by negotiation, both sides will accept the results of arbitration rather than resorting to strike action
142
non current assets
items owned by the firm that have a monetary value and long term function and can be used repeatedly
142
non current liabilities
long term debts owed by the firm and due to be repaid in over a year
143
non-financial methods of motivation
methods of motivation through job design rather than monetary rewards
143
not for profit businesses
businesses with a motive other than profit, this may be to provide a social benefit or service to society or support a cause
144
objectives
medium to long term targets that give direction to a business
145
off shoring
moving production to an overseas, usually lower wage, location
145
off the job training
all forms of training apart from that that takes place in the actual workplace
145
oligopoly
exists when a market is dominated by a small number of large firms
145
one off item
see extraordinary and exceptional items
145
on the job training
instruction received at the place of work on how a job should be carried out
146
operating profit
profit from normal activities. turnover minus total costs
147
operating profit margin
the % of turnover that actually becomes operation profit
147
operational targets
targets set by the operations function of the business
147
opportunity cost
the cost of a course of action measured in terms of the next best alternative forgone
147
organic growth
expansion from within the firm i.e. not as a result of an acquisition
147
organisational culture
the values and standards shared by people and groups within an organisation
148
organisational structure
the way in which the workforce within a business is organised, both horizontally and vertically
148
outsourcing
the practice of using the services of another external organisation to carry out part of your work process
149
overdraft
a facility that enables a firm to borrow up to an agreed maximum from their bank account for any period of time it wishes
149
overtime ban
a form of industrial action that tries to disrupt the employer while keeping the employees' basic wages unaffected
149
overtrading
when a firm expands without securing the necessary long term finance thereby placing too great a strain on working capital
149
own-brand labels
products branded with the retailors own name or a name invented by the retailer
149
part time workers
that makes someone full or part-time, but a full-time worker will usually work 35 hours or more a week
149
patent
a form of intellectual property that grants the holder, an individual or business, the sole right to use unique features of a now product or process
150
payables
money owed to suppliers
151
payables days
how long on average it takes for a business to pay for their supplies that it has purchased on credit
151
payback
A method of investment appraisal that calculates how long it will take to pay back the cost of the initial investment
151
penetration pricing
setting a low initial price for a new product in order to get a foothold in the market and gain market share
151
People (7 Ps)
the element of marketing mix provided by employees e.g. customer service
152
performance related pay
a method of financial motivation where part of the employee's salary is linked to their performance on the job
153
person specification
a statement of the characteristics required to do a job successfully
153
physical environment (7 Ps)
an element of the marketing mix that includes the design and features of the actual place where the transaction takes place
154
piece rate pay
employees are paid a set amount for each item of work completed
155
planned strategy
a medium to long term plan that is introduced and implemented with foresight
156
Place (7 Ps)
an element of the marketing mix that defines both the physical location where a product is available as well as the distribution channel it has travelled through from manufacturer to customer
157
Porter's generic strategies
analyses the marketing strategies of low cost versus differentiation in both mass and niche markets
158
predatory pricing
setting a price low enough to drive competitors out of the market
159
pressure group
an organisation formed by a group of people with a common interest who get together in order to further that interest
160
Price (7 Ps)
an element of the marketing mix that defines the amount of money that is paid for a good or service by a customer
161
price discrimination
charging different prices to different people for what is essentially the same product
162
price elasticity
a measure of the way the demand for a good responds to a change in its price
163
price leader
a brand that is in such a powerful position within its marketplace that it can largely dictate the prevailing selling price
164
price skimming
setting a high initial price for a new product in order to recoup high research and development costs
165
pricing strategy
a medium to long term plan of the price level a firm wishes to set for a product
166
pricing tactics
a way of using price to take advantage of a short term opportunity or threat
167
private limited companies
an incorporated business that is owned by shareholders who tend to be family and friends.
168
private sector business
the sector of the economy that is owned and controlled by individuals or groups of individuals rather than by the government
169
privatisation
the process of returning firms or industries to the private sector after being run by the state
170
problem child
a product within the Boston Matrix characterised by high market growth and low market share
171
Product (7 Ps)
component of the marketing mix that looks at the goods/services that a business provides
172
Process (7 Ps)
element of the marketing mix that refers to how a product is bought and the ease of a transaction
173
product development
developing new products or upgrading existing ones
174
product portfolio
range of products or brands held by a company that provide it with diversified sources of income
174
product positioning
having a clear idea about the segment of the market that a product or service is targeted at
174
productivity
the output per unit of input in a production process
175
product life cycle
the stages that a product will go through in its lifetime - development, introduction, growth, maturity, decline
175
product placement
a marketing technique in which a product or service is showcased in some form of media, such as television shows, movies, music videos. etc
176
profit
the surplus money made by a business when revenue exceeds costs
176
profit budget
a target amount of surplus (total revenue - total costs) to be achieved by a business in a specific time period
176
profit for the year
profit after tax has been deducted from operating profit but before payment of dividends
176
profit for the year margin
a measure of profitability that shows a business' profit for the year as a % of sales revenue
176
profitability
the efficiency with which a business generates profit
176
public sector organisations
the sector of the economy that is owned and controlled by the government rather than individuals or groups of individuals
177
profit quality
refers to the sustainability of profit or the likelihood of a profit source continuing into the future
177
Promotional mix
the combination of promotional activities that a business uses to create consumer awareness and generate sales
177
Promotion ( 7 Ps)
part of the marketing mix that informs and persuades customers about the product/service in order to sell that product
177
Public limited companies
an incorporated business that is able to sell shares on the stock exchange
177
protectionism
the policies imposed by governments to restrict the free movement of goods and services between countries
178
public relations
a promotional method that involves communicating with the media in order to get favourable publicity
179
quality circles
a discussion group that meets regularly to identify quality problems, consider alternative solutions and recommend a suitable outcome
179
quality chains
each person treats the receiver of their work as if they were an external customer and adopts a target of 'right first time' or zero defects
179
qualitive research
in-depth research into the motivations behind consumer behaviours and attitudes
179
quality control
process of inspecting a good before it is delivered to a customer
179
random sample
contacting every member of a population so that every member of the population has an equal chance of being interviewed
179
quantitative research
research using pre-set questions among a large enough sample size to provide statistically valid data
179
quality assurance
the checking of goods or service at each stage of its production to ensure that quality standards are met throughout the organisation
179
quote sample
the proportion of the population chosen for study reflects the characteristics of the target market
180
ratio analysis
a method of analysing a business' financial performance by looking at relationships between figures
181
rationalisation
meaning reorganising to increase efficiency
182
real incomes
money incomes deflated by the level of prices
183
receivables
money owed to a business from sales made on credit when payment has not yet been received
184
receivables days
how long it takes on average for customers to pay for goods or services that they have purchased on credit
185
recession
parts of the trade cycle characterised by falling levels of demand, very little investment, low business confidence and rising unemployment
186
recruitment
process of identifying the need for new employees, defining the job and the appropriate person for it, attracting suitable candidates and selecting the one most suitable
186
redeployment
transferring an employee who faces redundancy to a suitable alternative position within the business
186
redundancy
when an employee loses their job because the job itself is no longer needed, maybe due to downsizing, new technology or closure
186
regional structure
an organisational structure where employees are organised based on geographical location
187
regulators
organisations that are responsible for setting guidelines for businesses to follow to provide effective competition
187
re-order levels
the quantity of inventory considered the minimum before more needs to be ordered
187
reserves
a company's accumulated retained profits
187
research and development
scientific research and technical development
187
re-order quantity
the volume of inventory ordered at the point of the re order level
188
re-shoring
the process of bringing business operations back to the domestic country
189
resistance to change
occurs as a result of: fear of the unknown; mistrust of the motives of those proposing change: worries about the loss of job security, income or status
189
retained profits
profit that is left after all additions and deductions from sales revenue. it is a source of long term internal finance
189
restructuring
the process of rearranging the organisational structure to increase efficiency, gain a competitive advantage and achieve objectives
189
retention rates
the ability of an organisation to keep its employees
189
risk
the potential for loss when undertaking a venture to attain rewards
189
retrenchment
the downsizing of the scale of an organisation
189
return on capital employed (ROCE)
how efficiently a business uses its capital employed to create profit
190
return on capital invested
a financial objective based on financial returns and therefore the efficiency of an investment and whether it is profitable
190
revenue
the money coming into a business from the sale of goods or services
190
revenue budgets
a target amount of revenue to be achieved by a business in a specific time period
190
sale and leaseback
a source of finance where the firm sells a non current assets and leases it back to continue benefitting from its use
190
sales promotions
short term incentives to purchase such as free offers, samples
191
share capital
money raised from the sales of shares
191
secondary market research
collecting data from second hand sources, it has been undertaken by someone else and so already exists
191
segmentation
process of dividing a market up into groups of people with similar characteristics in order to target the identified subsection
191
shareholders
investors who are part owners of the company
191
sample
a group of respondents to a market research exercise selected to be representative of the views of the target market as a whole
192
share price
the value attached to each individual share that is bought and sold on the stock market or by the business
192
selection
part of the recruitment process and refers to how a firm chooses from numerous applicants
192
short-termism
a view taken by stakeholders that focus on profits and financial rewards over a willingness to invest in the longer term
193
scientific decision making
making business decisions on the basis of data that is researched and tested quantitively
194
single union agreements
the recognition by a firm of only one workforce representative body for collecting bargaining purposes
194
social responsibility
the way in which a business meets its responsibilities to society as a key external stakeholder and especially with groups and individuals with a direct interest in the business
194
social enterprise
businesses that put the interests of people and planet ahead of shareholder gain. these businesses are driven by a social/environmental mission and reinvest profits into creating positive social change
194
social media
the use of channels of communication generated by the public and tapped into by businesses using technologies such as blogs and websites
194
soft HR
staff are treated as an asset to the business, contributing and helping the business to achieve its objectives
194
span of control
the number of subordinates that a manager is directly responsible for
194
sources of finance
the options available to a business when seeking to raise funds to support day to day expenses and future developments
194
stakeholder
anyone with an interest in the actions of a business
194
sole trader
an individual who owns and runs their own business
195
stakeholder mapping
a tool to help in managing stakeholders by assessing levels of power and interest
196
strategic change
managing change within a organisation in order to meet corporate objectives
196
stockout
when a business runs out of stock/inventory
196
suppliers
businesses within the supply chain responsible for providing goods or services to other businesses
196
strategic direction
the course a business has chosen to take in order to achieve its corporate objectives
196
sustainability
a measure of whether a production process can be continued into the long term future
196
strategic drift
when a strategy fails to adapt to changes in the internal/external environment making it on longer fit for purpose
196
strategic objectives
long term goals of significance to the operations of the whole organisation
196
subcontracting
finding an external supplier to manufacture all or part of your product
196
strategic positioning
where a business wants to be in a market relative to other businesses
196
strategy
medium to long term plans of a business to achieve its corporate objectives
197
substitute goods
a brand or product that fulfils the same function as another and can therefore be used in its place
197
stratified sampling
the population it first segmented into subgroups before respondents are randomly selected from within subgroup
198
tactics
measures adopted to deal with a short term opportunity or threat
198
synergy
the interaction or cooperation of two or more organisations or other agents to produce a combined effect greater than the sum of their separate effects
198
talent development
a process that seeks to identify and nurture a talented few seeing these people as key to the long-term success of business
199
takeovers
a form of external growth where one business gains control over another and becomes the owner
200
tail hierarchy
an organisation with many layers or hierarchy and a narrow span of control
201
tangible assets
assets that have a physical state
202
Tanenbaum and Schmidt continuum of leadership
a model of leadership that considers the level of autonomy that a worker has within a business
203
target market
the precise profile of the customers a firm wishes to sell to
204
tariff
a tax imposed on an imported good
205
taxation
a financial charge by the government on an individual or business
206
Taylor, FW
a motivational theorist who states that all tasks should be studied scientifically and financial incentives should should provide rewards for hard work
207
teamworking
employees are organised into groups and work together in order to meet set objectives
208
test marketing
the launch of a new or improved product within a tightly defined area, in order to measure sales potential.
209
time and motion study
the investigation of the efficiency with which a task is carried out. (F. W. Taylor)
210
total costs
all of the costs associated with the provision of a good or service
211
total equity
share capital plus reserves/ retained profits. on a balance sheet total equity is equal to net assets
212
TQM
a culture of quality affecting the attitudes and actions of every employee
213
trade credit
providing business customers with time to arrange for the payment of goods that they have already received
214
trade mark
a sign that can distinguish the goods and services of a business from those of its competitors
214
trade union
an organisation with a remit to protect members and improve their economic well being and working conditions
215
triple bottom line
considering a firm's performance from a social and environmental perspective as well as a financial one
215
training
the process of equipping employees with the skills and knowledge necessary to carry out their job effectively
216
two factor theory
the inability to predict exactly what will happen in the future or place a quantifiable probability on what is likely to happen
217
uncertainty
a non measurable unknown associated with a decision
217
unique selling point
the feature of a product that can be focused on in order to differentiate it from all competition
218
unlimited liability
the owners of the business are responsible for the total amount of debt of the business
219
urbanisation
a general movement of people towards cities and away from rural areas
220
value added
difference between cost of inputs and the price customers are prepared to pay for the finished product
221
variable costs
cost to a business that change in relation to output
222
variance analysis
the difference between the budgeted amount and what actually happens. a variance can be "positive" (favourable) or "negative" (adverse)
223
venture capital
investment made by specialist funds to finance the launch, early development or expansion of a private company in return for a % equity in the business
224
vertical intergration
expansion by a business involving firms operating at different stages of the supply chain e.g. a retailer buys a wholesaler, or a distributor buys a manufacturer
225
viral marketing
use of social networking sites or SMS to increase brand or product awareness
226
vision statement
statement of what the organisation would like to achieve or accomplish in the long term
227
wholesaler
wholesalers buy goods in bulk from a manufacturer at a discounted price and sell to a retailer for a higher price, for them to repackage and in turn resell in smaller quantities at an even high price to consumers
228
window dressing
methods used by companies to present their financial performance in the most favourable terms possible
229
work to rule
Work-to-rule is a job action in which employees do no more than the minimum required by the rules of their contract or job
230
workforce planning
how a business determines how many and what kind of employees are required
231
working capital
amount of money that a business has available to conduct its day-to-day activities. in accounting terms the net amount invested by a business to finance day-to-day trading: usually calculated as a current assets less current liabilities
232
work councils
an internal group made up of representatives of employers and employees within a business who meet to discuss issues affecting the workforce
233
zero hours contracts
an employment contract between an employer and a worker, which means the employer is not obliged to provide the worker with any minimum working hours, and the worker is not obliged to accepts any of the hours offered
