CHAPTERS 1-5 ENTERPRISE Flashcards
SME
Small and medium sized enterprises.
Employ less than 250 people.
Turnover less than £50m.
Primary sector
Any industry involved in the extraction and production of raw materials, such as farming, fishing, and mining.
Secondary sector
Secondary industry is the industry that produces finished products from raw materials collected by primary industry. It includes light and heavy industries, such as textiles, steel, food, and chemicals.
Entrepreneur
Someone who starts and runs a business.
Tertiary sector
The tertiary sector is the services sector of an economy, which includes financial institutions, shops, schools, hotels, and restaurants.
Business plan
A document that contains the objectives of a business and how the business intends to achieve these objectives.
It includes an executive summary, a marketing plan, an operations plan, a human resources plan, and a financial plan.
Needs
Items that are required for survival. e.g. food, shelter, water etc
Wants
Items that an individual would like to have but do not require for survival. e.g. holidays, new phones etc
Risk Taker
Someone who invest their own capital or time without the guarantee of getting their money back
Monopoly
One business that dominates the market, they have 100% market share.
Oligopoly
many businesses but only a few dominate.
different products with a strong brand identity.
examples include apple, samsung etc
Monopolistic competition
A large number of relatively small businesses. Products are similar, with some differentiation. Brand identity is relatively weak. Businesses have a limited degree of control over prices. Few barriers to entry exist. E.g. Hairdressers and local take-aways.
Perfect competition
Large number of businesses of the same size. They are price takers. Goods are homogenous (no branding, no differentiation, no way of telling goods apart E.g. carrots). All businesses have equal technology. All customers have the same information.
Barrier to entry
Factors that can prevent or impede new businesses entering a market or industry sector, and so limit competition. These can include high start-up costs, regulatory hurdles, or other obstacles that prevent new competitors from easily entering a business sector.
Cartel
When businesses in an oligopolistic market act together (collude), a cartel is formed. Cartels try to keep prices high and share the market between themselves. This has happened in the airline industry and sports clothing industry. It is illegal.
