Keywords Flashcards
Marketing
The management process that is responsible for anticipating, identifying and satisfying customer needs PROFITABLY
Market research
The process of gaining information about customers, competitors and market trends through collecting primary and secondary data.
Primary data
Information that has been gathered for a specific purpose through direct investigation, e.g. observation, surveys and experiments
Secondary data
Information that already exists such as accounts and sales records, government statistics, newspaper and internet articles and reports from advertising agencies.
Quantitative data
Data that can be expressed as number and can be statistically analysed.
Qualitative data
Data about opinions, judgements and attitudes,
Survey
Research involving asking questions of people or organisations
Respondents
Those who provide data for a survey usually by answering questions
Market Segment
Part of a market that contains a group of buyers with similar buying habits
Sample
A small group out of the total population which is selected to take part in a survey
Questionnaire
A list of questions to be answered by respondents, designed to give information about consumer’s tastes.
Product Trial
When customers buy a good for the first time and assess whether or not they want to buy it again.
Public Relations
Promotion of a positive image about a product or business through giving information about the product to the general public
Viral Marketing
Getting individuals to spread a message about a product through their social networks, e.g. Facebook or their group of friends
Penetration Pricing
Setting an initial low price for a new product so that it is attractive to customers. The price is likely to be raised later as the product gains market share.
Trade Buyers
Buyers of good which then sell those goods on to consumers or other buyers - they include supermarket chains and wholesalers
Retailers
Businesses which specialise in selling goods in small quantities to the consumer
Customer Loyalty
The willingness of buyers to make repeated purchases of a product or from a business
Repeat Purchase
When a customer buys a product more than once
Product Life Cycle
The stages through which a product passes from its development to being withdrawn from sale ; the phases are Research and Development, Launching The Product, Growth, Maturity, Saturation, Decline
Research and Development
The process of scientific and technological research and then development of the findings of that research before a product is launched.
Extension Strategy
Method used to increase the life of a product and prevent it from falling into decline
Product Portfolio / Product Mix
The combination or range of products that a business sells
Product Portfolio Analysis
Investigation of the combination of products sold by a business
Boston Matrix
A model which analyses a product portfolio according to the growth rate of the whole market and the relative market of a product within that market; a product is placed in one of four categories - Star, Cash Cow, Problem Child or Dog
Brand
A named product which consumers see as being different from other products and which they can associate and identify with
Generic Product
A product made by a number of different businesses in which customers see very little or no difference between the product of another business.
Own Brand
A product which is sold under the brand name of a supermarket chain or other retailer rather than under the name of the business which manufactures the product.
Product Differentiation
Making one product different from another in some way, e.g. through the quality of a product, its design, packaging or advertising
Premium Pricing
A price which is above average for products of a particular type
Marketing Mix
A combination of factors which help a business to take into account customer needs when selling a product, usually summarised as the 4 P’s (Price, Product, Promotion and Place)
Design Mix
The range of variables which contribute to successful design - function, cost and appearance
Stocks
Materials that a business holds. They could be materials waiting to be used in the production process and some could be finished stock waiting to be delivered to customers.
Maximum stock levels
The highest amount of stock to be kept by a business
Re-order level
The amount of stock held by a business at which an order for new stock is placed with suppliers
Just in Time (JIT)
A stock management system where stocks are only delivered when they are needed by the production system, and so no stocks are kept by a business.
Quality
Achieving a minimum standard for a product or service, or a production process which meets customers needs.
Quality Control
Ensuring that a product or service meets minimum standards, often through testing of sample products ONCE THEY HAVE BEEN MADE.
Quality Assurance / Quality Culture
Ensuring that quality is produced and delivered at EVERY STAGE of the production process, often through making quality the responsibility of every worker.
Customer Service
The experience that a customer gets when dealing with a business and the extent to which that experience meets and exceeds customer needs and expectations.
Innovation
The process of transforming inventions into products that can be sold to customers
Sale of Goods Legislation
Gives consumers rights to COMPENSATION if a product they buy is not of MERCHANTABLE QUALITY, not as DESCRIBED or not fit for PURPOSE
Trade description Legislation
Makes businesses liable for prosecution and fines if products are sold in a misleading way
Cash Flow
The flow of cash into and out of a business
Financial Management
Deliberately changing monetary variables like cash flows to achieve financial objectives such as improved cash flow
De-stocking
Reducing the levels of stocks in a business
Trade Credit
Where a supplier gives a customer a period of time to pay for a bill (or invoice) for goods or services once they have been delivered.
Profit
Occurs when the REVENUES of a business are GREATER than its COSTS over a period of time.
Revenues
The amount of money received from selling goods or services over a period of time.
Break-Even Point
The level of output where total revenues are equal to total costs; this is where neither a profit nor a loss is being made.
Total Revenue
The revenue earned by a business from the SALE OF A GIVEN QUANTITY x AVERAGE PRICE
Total Costs
All the costs of a business; equal to FIXED COSTS + VARIABLE COSTS
Fixed Costs
Costs which do not vary with the amount produced, e.g. rent, business rates, advertising costs, administration costs, salaries
Variables Costs
Costs which change directly with the number of products made by a business, e.g. cost of buying raw materials
Break-Even chart
A graph which shows total revenues and total costs, allowing the break-even point to be drawn.
Margin Of Safety
The amount of output between the actual levels of output where profit is being made and the break-even level of output; if the MoS is zero, then production is at or below the B/E level
Financing a business
How a business obtains money and other financial resources to start up, expand and if necessary; pay off losses it has made
Internal Sources of Finance
Finance which is obtained within the business such as retained profit or the sale of assets
External Sources of Finance
Finance which is obtained from OUTSIDE the business such as bank loans and cash from the issue of new shares.
Retained Profit
Profit which is kept back in the business and used to pay for investment in the company
Equity / Share Capital
The monetary value of a business that belongs to the business’ owners. In a company, this would be the value of their shares.
Share
A part ownership in a business. e.g. a shareholder owning 25% of the shares of a business owns a quarter of the business.
Overdraft
Borrowing money from a bank by drawing more money than is actually in a current account. Interest is charged on the amount withdrawn.
Bonds
A long-term loan where typically interest is paid at regular intervals like a year, and the loan is all repaid at the end of the life of the bond. Bonds are traded on stock markets.
Organisation
The way in which a business is structured for it to achieve its objectives
Organisation Chart
A diagram which shows the INTERNAL STRUCTURE of an organisation.
Hierarchy
Structure of different levels of authority in a business organisation, one on top of the other.
Line Manager
Employee who is responsible for overseeing the work of others further down the hierarchy of an organisation.
Function
Tasks or jobs. Organisation by functions means that a business is organised according to tasks that have to be completed, such as production or finance.
Authority
The right to decide what to do in a situation and take command of it to be able to make decisions without referring to anyone else.
Subordinate`
Workers in the hierarchy who work under the control of a more senior worker.
Chain of Command
The path (or chain) down which orders (or commands) are passed. In a company, this goes from the board of directors down to other workers in the organisation.
Delayering
Removing layers of management and workers in a hierarchy so that there are fewer workers in the chain of command.
Empowerment
Giving more responsibility to workers further down the chain of command in a hierarchy
Downsizing
When a business employs fewer workers to produce the same amount through increases in productivity which can be achieved through delayering
Span of Control
The number of people who report directly to another worker in an organisation
Delegation
Passing down of authority to work to another worker further down the hierarchy of the organisation
Centralisation
A type of business organisation where decisions are made at the centre or core of the organisation and then passed down the chain of command
Decentralisation
A type of business organisation where decision-making is pushed down the hierarchy and away from the centre of the organisation.
Motivation
In work, the desire to complete a task.
Hierarchy of Needs
Placing needs in an order of importance, starting with basic needs.
Communication
Messages passed between sender and a receiver, through a medium such as a letter or an email
Feedback
Response to a message by its receiver to the sender
Internal Communication
Communication within the business organisation
External Communication
Communication between the business and an outside individual organisation, e.g. a customer/supplier/tax inspector.
Channel of Communication
The path taken by a message, such as horizontal communication or grapevine communication
Formal Channels of Communication
Channels of communication that are recognised and approved by the business and by employee representatives such as trade unions.
Informal communication or communication through the grapevine
Communication through channels that are not formally recognised by the business
Payment systems
Methods of organising the payment of workers, such as piece rates or salaries
Manual or blue collar workers
Workers who do mainly physical work like an assembly line worker
Wages
Tend to be paid to manual workers for working a fixed number of hours per week plus overtime
Overtime
Time worked over and above the basic working week
Basic Pay
Pay earned for working the basic working week
Non-manual or white collar workers
Workers who do non-physical work, like an office worker or teacher
Salary
Pay, usually of non-manual workers, expressed as a yearly figure but paid monthly
Commission
Payment system usually operated for sales staff where their earnings are determined by how much they sell
Bonus
Addition to the basic wage or salary, for instance, for achieving a target.
Part-time workers
Employees who work only for a fraction of the working week
Full-time workers
Employees who work the whole of the working week
Temporary workers
Workers who have no permanent contract of employment with a business and so tend to work only for a short period of time for an employer.
Freelance workers
Workers who tend to be self-employed and do particular pieces of work for a business as a supplier
Fringe Benefits
Payments in kind over and above the wage or salary, such as a company car
Business Ethics
Ideas about what is morally correct or not, applied in a business situation
Supply Chain
The processes that are involved in the route taken by a product from the raw materials needed to create it right through to the final customer
Developed Countries
Countries with a relatively high income per person
Developing Countries
Countries with a lower income per person than developed countries
Import
An import is the purchase of good/service from a foreign business that leads to a flow of money out of the UK. The UK buyer will have to change pounds into the seller’s currency to make the transaction.
Export
An export is the sale of a good or service to a flow of money into the UK. The foreign buyer will have to change their currency into pounds to complete the purchase.
Protectionist Policies
Measures designed to reduce foreign products coming into a country but gives an advantage to domestics firms to sell products at home or export products
Tariffs or customs duties
Taxes put on goods imported into a country which make them more expensive
Quotas
Limits on the physical number of goods that can be imported over a period
Export subsidies
Measures that reduce the price of goods sold abroad.
Minimum wages
The lowest payment for hour, day or week that can be given to a worker for their work
