Chapter 3 Business Planning Flashcards
Planning
Planning is the process of formulating objectives and determining how to achieve them.
Resource
A resource is any person or product that will help in the production of a good or service.
Human Resources
Human resources are the employees who provide their time, energy, skills and effort.
Physical resources
Physical resources refer to equipment such as a computer, cash register, machinery, motor vehicle, of ce equipment and stock.
Asset
An asset is any item of value owned by the business.
Establishment cost
Establishment costs include those costs involved in setting up the business.
Operating cost
Operating costs include those costs involved in the ordinary day-to-day running of the business.
Equity
Equity is the funds contributed by the owner(s) of a business to commence and build the business.
Debt
Debt is the funds provided by sources outside the business, which must be paid back over time, with interest.
Working Capital
Working capital is the funds available for the short-term nancial commitments of a business.
Bank overdraft
With a bank overdraft, the bank allows a business or individual to overdraw their account up to an agreed limit for a speci ed time, to help overcome a temporary cash shortfall.
Mortgage
A mortgage is a loan secured by the property of the borrower (the business).
Leasing
Leasing is a way of nancing the purchase of assets without a large initial capital outlay.
Lessee
The lessee is the person or business to whom a lease is granted.
Lessor
A lessor is the owner of an asset that is leased under an agreement to the lessee.
Marketing
Marketing is ‘the process of planning and executing the conception, pricing, promotion and distribution
of ideas, goods and services to create exchanges that satisfy individual and organisational objectives’ (American Marketing Association).
Marketing objectives
A marketing objective is a statement of what is to be achieved through the marketing activities.
Target market
The target market is the group of customers to which the business intends to sell its product.
Marketing strategies
Marketing strategies are actions undertaken to achieve the business’s marketing objectives.
Marketing mix
Marketing mix refers to the combination of the four elements of marketing, the four Ps — product, price, promotion and place — that make up the marketing strategy.
Marketing management
Marketing management is the process of monitoring and modifying the marketing plan.
Enlightened self interest
Enlightened self-interest is the belief that a business ultimately helps itself when it helps to solve society’s problems.
Triple bottom line
Triple bottom line refers to the economic, environmental and social performance of a business.
business plan
A business plan is a written statement of the business’s goals and objectives, and the steps to be taken to achieve them.
