Glossary Flashcards
Accountants
The professionally qualified people who have responsibility for keeping accurate accounts and for
producing the final accounts
Accounts
The financial records of a firm’s transactions
Acquisition
See take-over
Added Value
The difference between the selling price of a product and the cost of bought-in materials and components
Agent
An independent person or business which is appointed to deal with the sales and distribution of a product or range of products. The agent will either put an additional amount on the price to cover their expenses or will receive a commission on sales.
AIDA Model
Simple way of planning an advert’s design – it means: Attention, Interest, Desire, Action
Annual General Meeting
A legal requirement for all companies. Shareholders may attend and vote on who they want to be on the
Board of Directors for the coming year.
Application Form
A form completed by an applicant for a job vacancy, which summarizes the applicants name, address,
education, qualifications, previous experience
Appraisal
Method of assessing the effectiveness of an employee, usually involving an interview with a senior member
of staff
Appreciation of a currency
When the value of a currency rises and it can buy more of another currency than before
Appropriation account
The part of the profit and loss account which shows how the profit after tax is distributed - either as
dividends or kept in the company as retained profits
Arbitrator
A person who listens to both sides in an industrial dispute (trade union and management) and then gives a ruling on what the arbitrator thinks is fair to both sides
Assets
Those items of value that are owned by the business. They may be fixed (non-current) or short-term current
assets.
Autocratic leadership
Instructions and strategies are issued from above with little opportunity for contributions to decision-
making from less senior employees
Average cost per unit
The total cost of production divided by total output (sometimes referred to as ‘unit cost’).
Balance of payments
Records the difference between a country’s exports and imports.
Balance sheet
Shows the value of a business’s assets and liabilities at a particular time. It is sometimes referred to as
‘statement of financial position’.
Batch production
When a quantity of one product is made, then a quantity of another item will be produced (that is, batches, usually as orders come in).
Best fit
See line of best fit.
Bonus
An additional amount of payment above basic pay as a reward for good work
Brand image
An image or identity given to a product, which gives it a personality of its own and distinguishes it from its
competitors’ brands
Brand loyalty
When consumers keep buying the same brand again and again instead of choosing a competitor’s brand.
Brand name
The unique name of a product that distinguishes it from other brands
Break-even charts
Graphs that show how costs and revenues of a business change with sales. They show the level of sales the business must make in order to break even.
Break-even level of output
The quantity that must be produced/sold for total revenue to equal total costs. It is also known as break-
even point.
Break-even point
The level of sales at which total costs total revenue
Budgets
Plans for the future containing numerical or financial targets
Buffer inventory level
The inventory held to deal with uncertainty in customer demand and deliveries of supplies.
Buffer stock
The minimum level of stock that a business plans to hold
Bulk decreasing
A good which decreases in size or weight during the manufacturing process, e.g. steel production where
there is a lot of waste from the raw materials, therefore the manufacture of steel tends to be located near to
the raw materials
Bulk increasing
A good which increases in size or weight during the manufacturing process, e.g. when Coca-Cola is
produced, the raw materials weigh less than the finished product after all the ingredients have been mixed together and water added. The finished product will therefore cost more to transport to the market than the raw materials cost to transport to the factory for manufacture and the factory will tend to be located near to the market
Business decisions
These include strategic decisions (very important ones which can affect the overall success of the business), tactical decisions (those which are taken more frequently and which are less important) and operational decisions (day-to-day decisions which will be taken by lower-level managers)
Business ethics
A set of standards or rules that prevent a business acting in an unfair or dangerous way towards their
workers or others
Business objectives
The aims or targets that a business works towards
Business plan
A document containing the business objectives and important details about the operations, finance and
owners of the new business
Businesses
These combine factors of production to make products (goods and services) which satisfy people’s wants.
Capital
The money invested into a business by the owners.
Capital employed
The total value of capital used in the business. This is: Shareholders’ equity plus non-current liabilities.
Capital expenditure
Money spent on fixed assets which will last for more than one year.
Cash flow
The cash inflows and outflows of a business over a period of time
Cash flow cycle
Shows the stages between paying out cash for labor, materials, and so on, and receiving cash from the sale
of goods.
Cash flow forecast
An estimate of future cash inflows and outflows of a business, usually on
a month-by-month basis. This
then shows the expected cash balance at the end of each month.
Cash inflows
The sums of money received by a business during a period of time.
Cash outflows
The sums of money paid out by a business during a period of time.
Centralized management structure
A management structure in which most decisions are taken at the center, or at higher levels of management
Chain of command
The structure in an organization which allows instructions to be passed down from senior management to lower levels of management.
Channel of distribution
The means by which a product is passed from the place of production to the customer or retailer
Cheque
A written instruction to a bank to transfer a specified sum to the person or business named on the cheque
Closed shop
All employees must be a member of the same trade union
Closing cash (or bank) balance
The amount of cash held by the business at the end of each month. This becomes next month’s opening
cash balance.
Collective bargaining
Negotiation between one or more trade unions and one or more employers (or employers’ associations) on pay and conditions of employment
Commission
Payment relating to the number of sales made.
Common currency
An agreement between countries to use the same currency for all business and other transactions, such as the euro in the European Union
Communication
The transferring of a message from the sender to the receiver, who understands the message
Communication nets
The ways in which members of a group communicate with each other
Communication barriers
Factors that stop effective communication of messages.
Competitive pricing
When the product is priced in line with or just below competitors’ prices to try to capture more of the
market.
Conflict at work
Where different groups have different points of view, e.g. over wage rates, hours of work, conditions, etc.,
and cannot come to an agreement
Conglomerate integration
When one firm merges with or takes over a firm in a completely different industry. It is also known as
diversification.
Consumer boycott
When consumers decide not to buy products from businesses that do not act in a socially responsible way.
Consumer panels
Groups of people who agree to provide information about a specific product or general spending patterns
over a period of time
Contract of employment
A legal agreement between employer and employee listing the rights and responsibilities of workers
Contribution
When referring to a product, this is its selling price less its variable cost.
Contribution margin
The selling price of a product less its variable cost
Corporation tax
The tax paid by limited companies on their profits
Cost-benefit analysis
The valuation by a government agency of all social and private costs and benefits resulting from a decision
Cost of goods sold
The cost of producing or buying-in the goods actually sold by the business during a time period.
Cost-plus pricing
The cost of manufacturing the product plus a profit mark-up.
Craft union
A trade union which represents a particular type of skilled worker
Creditors
Persons or businesses who have loaned money or supplied goods to a business without yet receiving
payment
Currency appreciation
Occurs when the value of a currency rises – it buys more of another currency than before.
Currency deprecation
Occurs when the value of a currency falls – it buys less of another currency than before.
Current assets
Those assets owned by a business and used within one year.
Current liabilities
Short-term debts owed by a business.
Debtors
Customers who owe money to the business
Decentralized
A management structure in which many decisions are not taken at the centre of the business but are
delegated to lower levels of management
De-industrialization
Occurs when there is a decline in the importance of the secondary, manufacturing, sector of industry in a
country.
Delayering
The removal of one or more layers of hierarchy from the management structure of an organization
Delegation
The act of giving a subordinate the authority to perform particular tasks. It is very important to remember that it is the authority to perform a task that is being delegated, not the final responsibility.
Delivery note
Sent by a supplier to the customer when the goods are delivered; the customer must sign the note to
confirm delivery
Democratic leadership
Senior employees consult with junior ones in policy-making
Depreciation
The fall in the value of a fixed asset over time.
Desk research
See secondary research
Development area
A region of a country where businesses will receive financial support to establish themselves ( often
regions of high unemployment)
Direct costs
Costs that can be directly related to or identified with a particular product or department
Direct taxes
These are paid directly from incomes, for example, income tax or profits tax.
Diseconomies of scale
The factors that lead to an increase in average costs as a business grows beyond a certain size.
Disposable income
The level of income a taxpayer has after paying income tax.
Diversification
See conglomerate integration
Distribution channel
The means by which a product is passed from the place of production to the customer or retailer
Dividends
Payments made to shareholders from the profits (after tax) of a company. They are the return to
shareholders for investing in the company.
Division of labor
When the production process is split up into different tasks and each worker performs one of these tasks. It
is a form of specialization.
E-commerce
The buying and selling of goods and services using computer systems linked to the internet.
Economic growth
When a country’s Gross Domestic Product increases – more goods and services are produced than in the
previous year.
Economic problem
When there exist unlimited wants but limited resources to produce the goods and services to satisfy those
wants. This creates scarcity.
Economies of scale
The factors that lead to a reduction in average costs as a business increases in size.
Employer federation
See employers· association
Employers’ association
a group of employers join together to give benefits to their members. Also called employer federations
and trade associations
Empowerment
See delegation
Enterprise
The skill and risk-taking ability of the person who brings resources together to produce goods or services
Entrepreneur
A person who organizes, operates and takes the risk for a new business venture.
Environment
Our natural world including, for example, pure air, clean water and undeveloped countryside
Environmental benefits
The gains to the environment as a result of business decisions
Environmental costs
The effect on the environment of business decisions
Ethical decisions
A decision taken by a manager or company because of the moral code observed in that firm
Exchange rate
The price of one currency in terms of another, for example £1: $1.5
Exchange rate appreciation
The rise in the value of a currency compared with other currencies.
Exchange rate depreciation
The fall in the value of a currency compared with other currencies.
Exports
Goods and services sold from one country to other countries.
External benefits
The gains to the rest of society, other than the business, resulting from business activity
External communication
Communication between the organization and other organizations or individuals
External costs
Costs paid for by the rest of society, other than the business, as a result of business activity
External economies of scale
External factors which influence a business and lead to a reduction in average costs as it increases in size
External finance
Finance obtained from sources outside of and separate from the business.
External growth
Occurs when a business takes over or merges with another business. Often called integration (see vertical
integration and horizontal integration) as one firm is integrated into another one
External recruitment
When a vacancy is filled by someone who is not an existing employee and will be new to the business.
External sources
Sources of information outside the company used to compile market research as a basis for marketing
decisions
Factors of production
Those resources needed to produce goods or services. There are four factors of production and they are in limited supply
Feedback
The reply from the receiver which shows whether the message has arrived, been understood and, if
necessary, acted upon
Field research
See primary research
Final accounts
Accounts produced at the end of the financial year that give details of the profit or loss made over the year
and the worth of the business
Fiscal policy
Any change by the government in tax rates or public-sector spending
Fixed costs
Costs that do not vary with the number of items sold or produced in the short run/term. They have to be
paid whether the business is making any sales or not. They are also known as overhead costs
Flow production
Where large quantities of a product are produced in a continuous process. It is sometimes referred to as
mass production.
Focus group
A group of people who are representative of the target market. They provide information about a specific
product or general spending patterns over a period of time. This helps with development and sales.
Forecasts
Predictions of the future, e.g. likely future changes in the size of the market
Formal communication
When messages are sent through established channels using professional language.
Formal group
A group designated to carry out specific tasks within a business
Franchise
A business based upon the use of the brand names, promotional logos and trading methods of an existing
successful business. The franchisee buys the license to operate this business from the franchisor.
Free trade agreements
These exist when countries agree to trade imports/exports with no barriers such as tariffs and quotas.
Free trade deal
An agreement between countries to allow trade between them without tariffs and quotas
Freight
A term used to describe bulk goods or products while they are being transported
Fringe benefits
Non-financial rewards given to employees
Full-time employees
Employees who work full time will usually work 35 hours or more a week. The number of hours that
workers usually work in a week will vary from one country to another.
General union
A trade union which represents workers ( often unskilled but also including semi-skilled) from a variety of trades
Globalization
The term now widely used to describe increases in worldwide trade and movement of people and capital
between countries.
Go slow
A form of industrial action when the employees do their normal tasks but more slowly than usual
Government influence
When a government wants to encourage business to locate to an area, it will offer grants to encourage them
to do so
Gross Domestic Product (GDP)
The total value of output of goods and services in a country in one year.
Gross profit
This is made when sales revenue is greater than the cost of goods sold.
Haulage
The transport of bulk goods or products; usually refers to road transport but can also refer to rail transport
Hierarchy
The management structure of an organization, often shown as an organization chart, which shows who is
accountable to whom
Horizontal integration
When one firm merges with or takes over another firm in the same industry at the same stage of
production
Illiquid
This means that assets are not easily convertible into cash
Import quota
A physical limit or restriction on the quantity of a product that can be imported
Import tariff
A tax on an imported product. Imports Goods and services bought in by one country from other countries.
Imports
Goods and services bought in by one country from other countries
Income statement
A document that records the income of a business and all costs incurred to earn that income over a period of time (for example one year). It is also known as a profit and loss account.
Incorporated businesses
Companies that have separate legal status from their owners.
Indirect costs
Costs which cannot be directly related to a particular product -often called overheads or overhead costs
Indirect taxes
These are added to the prices of goods and taxpayers pay the tax as they purchase the goods, for example,
VAT.
Induction training
An introduction given to a new employee, explaining the firm’s activities, customs and procedures and
introducing them to their fellow workers.
Industrial action
Steps taken by trade unions to decrease or halt production
Industrial tribunal
A legal meeting which considers workers’ complaints of unfair dismissal or discrimination at work.
Industrial union
A trade union which represents all types of workers in a particular industry
Inflation
The increase in the average price level of goods and services over time.
Informal communication
When information is sent and received casually with the use of everyday language.
Informal group
Group of people who form independently of any official groups because they have interests or aims in
common
Informative advertising
Where the emphasis of advertising or sales promotion is to give full information about the product.
Integration
When one business is integrated into another one.
Internal communication
Communication between members of the same organization.
Internal finance
Finance obtained from within the business itself.
Internal growth
Occurs when a business expands its existing operations.
Internal recruitment
When a vacancy is filled by someone who is an existing employee of the business.
Internal sources
Sources of information within the company, used to compile market research as a basis for marketing
decisions
Interview
A selection procedure on a one-to-one or two(or more)-to-one basis with a job applicant to ascertain their suitability for the job
Job analysis
Identifies and records the responsibilities and tasks relating to a job.
Job description
Outlines the responsibilities and duties to be carried out by someone employed to do a specific job.
Job enlargement
Where extra tasks of a similar level of work are added to a worker’s job description.
Job enrichment
Involves looking at jobs and adding tasks that require more skill and/or responsibility.
Job production
Where a single product is made at a time.
Job rotation
Involves workers doing each specific task for only a limited time and then doing a different task.
Job satisfaction
The enjoyment derived from feeling that you have done a good job.
Job specification
A document that outlines the requirements, qualifications, expertise, physical characteristics, and so on, for a specified job.
Just-in-time (JIT)
A production method that involves reducing or virtually eliminating the need to hold inventories of raw
materials or unsold inventories of the finished product. Supplies arrive just at the time they are needed.
Kaizen
A Japanese term meaning ‘continuous improvement’ through the elimination of waste.
Labour
The efforts of people needed to make products
Laissez-faire leadership
Employees are left to make many of the decisions rather than receiving clear instructions from their seniors
Land
All natural resources, including fields, forests, oil, gas, metals and other mineral resources
Lead time
The margin of time between the date when stock is obtained and the date when it is sold on
Leadership styles
The different approaches to dealing with people when in a position of authority – autocratic, laissez-faire or
democratic.
Lean production
A term for those techniques used by businesses to cut down on waste and therefore increase efficiency, for
example, by reducing the time it takes for a product to be developed and become available for sale.
Liabilities
Items owed by the business. Long-term liabilities are long-term borrowings which do not have to be repaid
within one year. Current liabilities are amounts owed by the business which must be repaid within one year
e.g. creditors and overdraft
Limited liability
Where the owners of a company cannot be held responsible for the debts of the company they own
Line managers
Those who have direct responsibility over people below them in a hierarchy of an organization.
Line of best fit
A line drawn through a series of points, e.g. sales data, which best shows the trend of that data
Liquidation
When a company is forced out of business by its creditors because of its inability to pay its short-term debts
Liquidity
The ability of a business to pay back its short-term debts
Lock-out
Employees are locked out of their workplace
Long-term liabilities
See liabilities
Manager
A person in a business with authority to give orders, make decisions, supervise subordinates
Marginal costs
Extra costs a business will incur by producing one more unit of output
Market
Where buyers and sellers come together to exchange products for money; this will not usually be a single
location
Market research
The process of gathering, analyzing and interpreting information about a market
Market segmentation
Where the market has been divided up into groups of consumers who have similar needs
Market share
The percentage of total market sales achieved by one brand or business
Marketing
The management process which identifies customer wants and anticipates their future wants
Marketing budget
A financial plan for the marketing of a product or product range for a specified period of time. It specifies how much money is available to market the product or range, so that the marketing department knows how much may be spent.
Marketing mix
A term which is used to describe all the activities which go into marketing a product or service. These
activities are often summarized as the four Ps – product, price, place and promotion.
Marketing strategy
A plan to combine the right combination of the four elements of the marketing mix for a product or service
to achieve a particular marketing objective(s).
Market-orientated business
A business that carries out market research to find out consumer wants before a product is developed and
produced.
Market research
Finds out consumer wants before a product is developed and produced
Market segmentation
The market is divided up into groups of consumers who have similar needs
Mass market
Where there is a very large number of sales of a product.
Mass production
See flow production
Medium of communication
The method used to send a message, for example, a letter is a method of written communication and a
meeting is a method of verbal communication.
Merger
When the owners of two businesses agree to join their firms to make one business.
Message
The information or instructions being passed by the sender to the receiver.
Micro-finance
The provision of financial services – including small loans – to low income people not served by traditional
banks.
Mixed economy
This has both a private sector and a public (state) sector.
Monetary policy
A change in interest rates by the government or central bank, for example the European Central Bank.
Monopoly
A business which controls all of the market for a product
Motivation
The reason why employees want to work hard and work effectively for the business.
Multinational businesses
These have factories, production or service operations in more than one country. These are sometimes
known as transnational businesses.
Need
A good or service essential for living.
Negotiation
Another name for collective bargaining -joint decision-making involving bargaining between
representatives of the management and of the workforce within a firm
Net assets
The net value of all assets owned by a business; net assets = fixed assets + ( current assets -current
liabilities) or net assets = fixed assets + working capital
Net cash flow
The difference, each month, between inflows and outflows.
Net profit (also called Profit or Profit before tax)
The profit made by a business after all costs have been deducted from sales revenue. It is calculated by
subtracting overhead costs from gross profits.
Niche market
A small, usually specialized, segment of a much larger market.
Non-cooperation
A form of industrial action when employees refuse to comply with new working practices
Non-current assets
Items owned by a business for more than one year.
Non-current liabilities
Long term debts owed by a business.
No-strike agreements
When trade unions and management agree to have pay disputes settled by an independent arbitrator instead of taking strike action
Off-the-job training
Involves being trained away from the workplace, usually by specialist trainers.
On-the-job training
Occurs by watching a more experienced worker doing the job.
One-way communication
Involves a message which does not call for or require a response.
Opening cash (or bank) balance
The amount of cash held by the business at the start of the month
Operational decisions
See business decisions
Opportunity cost
The next best alternative given up by choosing another item
Organizational structure
Refers to the levels of management and division of responsibilities within an organization.
Overdraft
The right given to a business by a bank to spend more money than it currently has in its account
Overheads/overhead costs
See indirect costs
Overtime
Work done over and above usual working hours
Overtime ban
A form of industrial action when employees refuse to work longer than their normal working hours
Packaging
The physical container or wrapping for a product. It is also used for promotion and selling appeal
Partnership
A form of business in which two or more people agree to jointly own a business.
Partnership agreement
The written and legal agreement between business partners. It is not essential for partners to have such an
agreement but it is always recommended.
Part-time employment
Often considered to be between 1 and 30–35 hours a week.
Penetration pricing
When the price is set lower than competitors’ prices in order to be able to enter a new market.
Performance
How a business has succeeded or been unsuccessful in a given period
Performance-related pay
Pay that is related to the effectiveness of the employee, where their output can easily be measured.
Persuasive advertising
Advertising or promotion that is trying to persuade the consumer that they really need the product and
should buy it.
Picketing
A form of industrial action; employers who are taking action stand outside their workplace to prevent or
protest at the delivery of goods, arrival and departure of other employees, etc.
Pictogram
A means of showing data, in which pictorial symbols are used to represent fixed numbers of items
Pie chart
A circular graph used to show what proportion of the collected data comes into each of the chosen
categories
Piece rate
Payment by quantity of product made
Place
One of the four Ps of the marketing mix -how the product reaches the market, the channel of distribution
Planning permission
When a government body allows a business to build a factory or office in a particular location
Point of sale
The place where the product is being sold, usually a shop
Pressure group
A group made up of people who want to change business (or government) decisions, which takes action
such as organizing consumer boycotts.
Price
One of the four Ps of the marketing mix -the price at which the product is sold
Price elasticity
A measure of the responsiveness of demand to a change in price
Price skimming
Where a high price is set for a new product on the market.
Primary research
The collection and collation of original data via direct contact with potential or existing customers. It is also
called field research.
Primary sector
This sector of industry extracts and uses the natural resources of the Earth.
Private benefits
The gains to a business
Private costs
The costs paid for by business
Private limited company (Ltd)
A company jointly owned by the people who have invested in it, they buy shares and become shareholders, have limited liability; the shares are not available to the general public
Product
One of the four Ps of the marketing mix -it refers to the design and quality of the product
Product life cycle
Describes the stages a product will pass through from its introduction, through its growth until it is mature,
and then finally its decline.
Product-orientated business
A business whose main focus of activity is on the product itself.
Production
Is the provision of a product or a service to satisfy consumer wants and needs
Productivity
The output measured against the inputs used to create it.
Productivity agreement
Workers and management agree an increase in benefits, in return for an increase in productivity
Profit
The total income of a business (sales revenue) less total costs
Profit and loss account
Account showing how the net profit of a business and the retained profit of a company are calculated
Profit sharing
A system whereby a proportion of the company’s profits is paid out to employees
Promotion
One of the four Ps of the marketing mix -how the product is advertised and promoted
Promotional pricing
When a product is sold at a very low price for a short period of time
Prospectus
A detailed document issued by the directors of a company when they are converting it to public limited
company status - it is an invitation to the general public to buy shares in the newly formed pie
Protectionism
When a government protects domestic firms from foreign competition using tariffs and quotas.
Psychological pricing
A pricing strategy where particular attention is paid to the effect that the price of a product will have upon
consumers’ perceptions of the product
Public limited company (pie)
The largest type of organisation in the private sector, raises finance by selling shares which can be
purchased by the general public
Public relations
Policies, strategies or measures taken to promote a good image for a company and/or its products
Purchase order
A request for goods or materials sent to a supplier
Quality
To produce a good or a service which meets customer expectations.
Quality assurance
The checking for the quality standards throughout the production process, whether it is the production of a
product or service.
Quality control
The checking for quality at the end of the production process, whether it is the production of a product or
service.
Questionnaire
A set of questions to be answered as a means of collecting data for market research
Quota sample
When people are selected on the basis of certain characteristics (such as age, gender or income) as a source of information for market research.
Random sample
When people are selected at random as a source of information for market research.
Real income
The value of income; it falls when prices rise faster than money income
Receiver
The person who receives the message
Recession
A period of falling Gross Domestic Product
Recruitment
The process from identifying that the business needs to employ someone up to the point at which
applications have arrived at the business.
Redundancy
When an employee is no longer needed and so loses their job. It is not due to any aspect of their work being
unsatisfactory.
Representative (union)
Person with responsibility to communicate trade union information between members and regional offices
and to represent the union members to management
Retailer
a retailer is an outlet selling goods direct to the customer (see also wholesaler) - some producers are also retailers, having their own retail branches as well as their own production sites
Retained profit
The net profit reinvested back into a company after deducting tax and payments to owners, such as
dividends.
Retrenchment
See redundancy
Revenue
The income of a business during a period of time from the sale of goods or services. Total revenue =
quantity sold × price.
Revenue expenditure
Money spent on day-to-day expenses which do not involve the purchase of a long term asset, for example
wages or rent.
Salary
Payment for work, usually paid monthly.
Sales invoice
Sent by a supplier to a customer as a request for payment for goods supplied
Sales promotion
Incentives such as special offers or special deals aimed at consumers to achieve short term increases in
sales.
Sales revenue
The income of a business during a period of time from the sale of goods or services
Sample
The group of people who are selected to respond to a market research exercise, such as a questionnaire.
Scarcity
The lack of sufficient products to fulfill the total wants of the population.
Secondary research
Information that has already been collected and is available for use by others. It is also called desk research.
Secondary sector
This sector of industry manufactures goods using the raw materials provided by the primary sector.
Segment
A specific group of customers or potential customers - see market segmentation
Selling price contribution
In break-even analysis, the amount the selling price contributes: contribution = selling price - variable costs
Sender
See transmitter
Share ownership
Where shares in the company are given to employees so that they become part owners in the company.
Shareholders
The owners of a limited company. They buy shares which represent part ownership of a company.
Shop steward
An unpaid representative of a trade union at factory/office level
Single-union agreement
A firm will deal only with one particular trade union and no others
Social benefits
External benefits + private benefits.
Social costs
External costs + private costs
Social enterprise
A business that has social objectives as well as an aim to make a profit to reinvest back into the business.
Social responsibility
When business decisions benefit stakeholders other than shareholders, for example, a decision to protect
the environment by reducing pollution using the latest and ‘greenest’ production equipment.
Sole trader
A business owned by one person.
Solvency
When a company has sufficient finances to stay in business
Span of control
The number of subordinates working directly under a manager.
Specialization
Occurs when people and businesses concentrate on what they are best at doing.
Staff managers
Specialists who provide support, information and assistance to line managers
Stakeholder
Any person or group with a direct interest in the performance and activities of a business
Start-up capital
The finance needed by a new business to pay for essential fixed and current assets before it can begin
trading.
Statement of account
A record of the total value of deliveries, credit and payments made to a customer in a given period, sent by a supplier to a customer each month; shows how much the customer owes to the supplier
Stock
The raw materials, components or finished products a business keeps in order to make or sell a product
Stock control
Ensuring there is enough stock to satisfy the needs of a business
Strategic decisions
See business decisions
Strike
A form of industrial action where employees refuse to work
Sustainable development
Development that does not put at risk the living standards of future generations.
Sustainable production methods
Production methods that do minimum damage to the environment
