DEFINITIONS Flashcards
Aim
Overall goal the business wants to achieve
Asset
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
Batch Production
A method of production where a firm makes one batch of identical items at a time
Business Enterprise
Process of identifying new business opportunities and taking advantage of them
Centralised Organisation
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
Decentralised Organisation
The authority to make most decisions is shared between people at different layers of the organisational structure
Design Mix
Function,Cost,Aesthetics
Differentiation
Making products distinctive in the market
Dividend
A payment a shareholder gets if the company makes a profit
E-Commerce
Buying and selling products on the internet
Entrepreneur
Someone who takes on the risks of enterprise activity
Extension Strategy
An action intended to extend the life of a product
External Growth
A company grows by merging with or taking over another firm
Flow Production
Method of production in which all products are identical and are made as quickly as possible
Franchise
Where a company lets another firm sell its products or use its trademarks in return for a fee or percentage of the profits
Fringe Benefit
Any reward for an employee that is not part of their regular income
Globalisation
Process by which businesses and countries around the world become more connected
Gross Profit
Profit left over once the cost of sales has been taken away from the total revenue
Incorporated
A business that has its own legal identity
Insolvency
When a firm is unable to pay off its debts
Internal Growth
When a company grows by expanding its own activities
Job Enrichment
When a worker is given greater responsibility in their job
Job Production
Method of Production in which each product has a unique design based on the customers specification
Just in Time (JIT)
A method used in production or stock management in which stock levels are kept at a bare minimum- products are made just in time for delivery to customers
Limited Liability
Where the owners of the business are not legally responsible for all the debts a business has
Loan
Long term source of finance that must be paid back later
Logistics
Getting goods or services from 1 part of the supply chain to another
Margin of Safety
Gap between current level of output and the break even level of output
Market Map
A diagram showing some of the features of a market
Marketing Mix
Place,Products,Price,Promotion
Multinational
A single business that operates in multiple countries
Net Profit
Profit left over when all costs are taken into account
Niche Market
Small and specialised group of potential buyers
Objective
A measurable step that a business will set in order to work towards an aim
Obsolete
When a product is no longer used usually because it has been outdated and replaced by something else
Overdraft
When more money is taken out of a bank account than has been paid into it
Partnership
A business ownership structure in which a small number of people own an unincorporated company
Pressure Group
An organisation that tries to influence what people think about a certain subject
Primary Research
Market Research that involves getting information from customers or potential customers
Private Limited Company
A business ownership structure that is incorporated and has shares, but the shares can only be sold with the agreement of all the shareholders
Procurement
Act of finding and buying things that a business needs from outside of the business
Product Life Cycle
Different stages a product goes through over time
Public Limited Company
A business ownership structure that is incorporated and has shares that can be bought and sold by anyone
Qualitative Information
Information involving people’s feelings or opinions
Quantitative Information
Information that can be measured or reduced to a number
Remuneration
Payment to an employee for the work they have done for the employer
Retailer
Business that sells products to consumers
Retained Profit
Profit put back into the business
Secondary Research
Market Research that involves looking at data from outside the business
Segmentation
When people within a market are divided into different groups
Share Capital
Money gained from issuing shares in the company
Sole Trader
A business ownership structure where one person owns an unincorporated company
Stakeholder
Any individual or group affected by a business
Stock Market
A market where shares of public limited companies can be bought and sold
Takeover
When an existing business expands by buying more than half the shares of another firm
Tariff
A tax on goods that are being exported or imported
Trade Bloc
A group of countries that has few or no trade barriers between them
Trade Credit
When a business gives firms time to pay for certain purchases
Unincorporated
A business that doesn’t have its own legal identity
Unique Selling Point
Feature that makes a product different to it’s competitors
Unlimited Liability
Where owners of a business are legally responsible for all debts a business has
Venture Capital
Money raised through selling share to individuals or businesses who specialise in giving finance to new or expanding small firms
Zero Hour Contract
The employer doesn’t have to offer the employee any work at all and the employee doesn’t have to accept any work offered to them
