Definitions Flashcards
Advertising
Any message that a firm pays for, which promotes the firm or its products
Aim
An overall goal that a business is trying to achieve
ARR
The average rate of return on an investment
Asset
A valuable item owned by a business, or money owed to the business
Autonomy
Where a worker is given the freedom to make their own decisions in their job
Bar gate stock graph
A graph that is used to manage a business’s stock levels
Batch production
A method of production in which a firm makes one batch of identical items at a time
Bonus
A lump sun added to an employee’s pay, usually once a year
Brand image
The impression that customers have of a company or the products it sells
Break-even level of output
The level of output at which a company’s total revenue equal its total costs
Business enterprise
The process of identifying new business opportunities and then taking advantage of them
Business plan
An outline of what a business will do and how it aims to do it
Cash
The money a business can spend immediately
Cash flow
The flow of all money into and out of a business
Cash inflow
Money that fllows into a business
Cash outflow
Money that flows out of a business
Centralised organisation
An organisation in which all major decisions are made by one person or a few senior managers at the top of the organisational structure
Commission
Money paid to sales staff for every item they sell on top of their basic salary
Competitor
A business which sells the same products in the same market a another business
Consumer
The person who uses a good or service
Cost
An expense paid out to run a business
Crowd funding
When a large number of people each contribute money towards funding a new business or business idea
Curriculum vitae
A summary of a person’s personal details, skills, qualifications and interests
Decentralised organisation
An organisation in which the authority to make most decisions is shared between people at different layers of the organisational structure
Demand
How much of a product or service people will be willing to buy at a given price
Design mix
The different elements of design needed to make a product successful, including its function, cost and aesthetics
Differentiation
Making products or services distinctive in the market
Diseconomy of scale
Where growth can lead to an increase in average unit cost
Dividend
A payment that a shareholder gets if the company makes a profit
E-commerce
Buying and selling products on the internet
E-tailer
A company that sells products online
Economy of scale
A reduction in average unit cost that comes from producing on a large scale
Entrepreneur
Someone who akes on the risks of entreprise activity
Exchange rate
A value that tells you how much one unit of a currency costs in a different currency
Extension strategy
An action intented to extend the life of a product
External growth
When a company grows by merging with or taking over another firm
External recruitment
Where a business recruits new people from outside the business
Fixed cost
A cost that does not vary with output
Flat structure
An organisational structure with very few layers
Flexible working
When working hours and patterns are adapted to suit the employee
Flow production
A method of production in which all products are identical and are made as quickly as possible
Formal training
A method of training which has a set plan with learning objectives and a schedule
Franchise
Where a company lets another firm sell its products or use its trademarks in return for a fee or a percentage of the profits
Freelance contract
When a self-employed person is recruited by a company on a temporary basis, usually to work on a specific project
Fringe benefit
Any reward for an employee that is not part of their regular income
Full-time staff
Employees that generally work 35-40 hours a week
