Theme 1 - keywords Flashcards
Mass market
Products or services which are targeted at the whole market
Niche market
Products or services which are targeted towards a specific segment of a market
Dynamic market
A market that is constantly changing
Risk
A concept where there maybe a possible negative impact that may arise from a future event
Uncertainty
Exists when the outcome of a particular situation is impossible to predict
Economies of scale
Factors that cause costs per unit to fall when a firm operates at a higher level of production
Product differentiation
The extent to which consumers perceive your brand/ product as being different from others
Unique selling point
A consumer benefit that no rival can match, perhaps because it can be protected by a strong patent
Market research
Gathers information about consumers, competitors and distributors within a firm’s market. A way of identifying consumers’ buying habits and attitudes to current and future products.
Market share
Proportion of total market sales that a firm has
Bias
A factor that causes research findings to be unrepresentative of the whole population
Product orientation
An inward-looking approach focusing on innovation and research and development. Development products to create desire
Market orientation
An outward looking approach focusing on identifying consumer needs and wants and tailoring product development towards it
Primary research
Finding and collecting information first-hand
Secondary research
Finding and collecting information which already exists
Qualitative research
Research that is focused on obtaining in-depth detailed information. Can identify opinions and why consumers feel the way they do
Leadership
Inspiring staff to achieve demanding goals
Management
Responsible for putting ideas or policies into action, whilst controlling staff
Charismatic Leadership
Leaders who can connect with an audience and who can get others to buy into their ideas.
Hubris
Overweening arrogance leading to excessive self-confidence and therefore blindness to the risks being taken
Entrepreneur
An individual who looks at business opportunities that exists and turns that idea into action
Intrapreneurship
Practice of entrepreneurship in an established firm.
Geographical mapping
Plotting on a map the locations of all existing businesses in your market, in order to show where all your competitors are
Innovation
New ideas brought to the market
Objective
Targets set that are SMART
Corporate objective
Targets for the whole business, such as profits to rise by 20% a year for the next 10 years
Functional objective
Objectives for each function (operations, marketing, HR and finance) which help to achieve the corporate objectives
Budget
An agreed ceiling on the monthly/ yearly spending by any department of manager
Unlimited liability
Owners are liable for any debts incurred by the business, even if this requires them to sell all their assets and possessions and become personally bankrupt
Limited liability
Owners are not liable for the debts of the business; they can lose no more than the sum they invested
Sole traders
A one-person business with unlimited liability, set up by an entrepreneur
Partnerships
A type of business organisation comprising between 2 to 20 people whom pool money, skills and other resources and share profit and loss based upon the partnership agreement. Unlimited Liability
Limited company
Company’s that have limited liability. They are considered to be a type of business structure whereby a company is considered a legally distinct body
Franchise
A business that sells the rights to the use of its name and trading methods to local businesses
Social enterprise
A business that focuses on putting its profits back into a strong social or environmental mission. Primarily social objectives rather than monetary
Floatation
The process of offering a company’s shares for sale on the stock market for the first time
Company
An organisation that sells goods or services in order to make money
Incorporation
Establishing a business as a separate legal entity from its owners, and therefore giving the owners limited liability
Registrar for companies
The government department which allows firms to be incorporated
Opportunity cost
The cost of missing out on the next best alternative when making a decision
trade off
Accepting less of one thing to achieve more of another (for example, slightly lower quality in exchange for cheapness)
overtrading
When a business expands at a rate that cannot be sustained by its capital base
Liquidity
The ability of a business to pay its bills on time, which all depends upon having enough cash in the bank
