Paper 1 - Making the business Effective Flashcards
BANKRUPT
When an individual is unable to pay their debts, even after all personal assets have been sold for cash.
LIMITED LIABILITY
Restricting the losses suffered by owners/shareholders to the sum they invested in the business.
PRIVATE LIMITED COMPANY
A small family business In which the shareholders enjoy limited liability.
SOLE TRADER
A business run by one person;that person has limited liability for any business debts.
UNLIMITED LIABILITY
Treating the business and the individual as inseparable, therefore making the individual responsible for all the debts of a failed business.
FRANCHISING
Paying a franchise owner for the right to use an establishment business name, branding and business methods.
ROYALTIES
Percentage of the sales revenue to be paid to the overall franchise owner.
ENTREPRENEUR
A person who sets up a business and takes on financial risks in the hope of a profit.
FIXED PREMISES
Buildings that have to be where they are e.g. the high street. Eco. Erie buildings can be located anywhere.
PROXIMITY
Nearness - where a business may wants to be close to a factor such as materials or labour.
PLACE
How and where the supplier is going to get the product or service to the consumer.
PRICE
Setting the price that retailers must pay, which in turn affects the consumer price.
PRODUCT
Targeting customers with a product that has the right blend of functional and benefits without being too expensive to produce.
PROMOTION
Within the 4Ps promotion means all the methods that a business uses to persuade customers to buy, for example branding, packaging, advertising.
BUSINESS PLAN
A detailed document setting out the marketing and financial thinking behind a proposed business idea.
