definitions Flashcards
adding value
the process of increasing worth of a product or service
adverse variance
a difference between actual and budgeted amounts
autocratic
management/ leadership style whereby the manager makes all the decisions
bank overdraft
borrowings from a bank on a current account which are payable on demand
batch production
method of production whereby a number of identical products are produced
boston matrix
a model which analyses the product portfolio of a business into 4 categories (stars, cash cows, problem child and dogs
branding
the use of a trade name, symbol, logo or other device to differentiate a product or service
break-even
the point at which the total sales of a business equal total costs- i.e. the business is making neither a profit nor a loss
budget
a detailed plan of income and expenses expected over a certain period of time.
business cycle
the changes and fluctuations in economic activity that the economy undergoes over a period of time
capacity utilisation
the proportion of total capacity that is used (expressed as a percentage)
cash flow
the movements of cash into (inflows) and out of (outflows)a business
cash flow
the movements of cash into (inflows) and out of (outflows)a business
cash flow forecast
a projection, usually by week or month, of the likely cash inflow and outflows in a business
cell production
method of production whereby production is split up into self-contained units
centralisation
organisational structure where all decision making is made at the top of the hierarchy
competition
the businesses that compete for a share of the market
competitiveness
the ability of a business to offer a better product than competitors (as measured by customers)
contribution
the difference between total sales and total variable costs
demand
the amount of a product or service that customers are willing and able to pay at a given time
decentralisation
organisational structure where decision making is passed down the heirarchy
democratic
management leadership style whereby the manager involves employees in the decision making process
distribution channel
how a business gets its products to the end consumer ( with or without the use of intermediaries)
dividend
a payment that is made by a company to its shareholders from the profit earned
elasticity of demand
the responsiveness of demand to a change in price or income
entrepreneur
a person who sets up a business and assumes all the risks and rewards
exchange rates
the rate at which one currency can be converted into another currency
favourable variance
a difference between actual and budgeted results which is good news. e.g higher tan budgeted revenue
franchise
form of business whereby one business allows another business to sell their products and services in return for a fee
fixed costs
costs that do not vary with the level of output
flow production
method of production whereby there is a continuous movement of items through the production process
