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BUSS3



BUSS3 Key Terms
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FUNCTIONAL OBJECTIVES AND STRATEGIES
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Corporate Objectives

A quantifiable statement of a business's goals which should include measurable targets
Functional Objectives

A quantifiable statement of a department's goals which should enable it to contribute to
the achievement of the business objective

Functional Strategy
The plan…

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BUSS3

Capital Expenditure
The purchase of assets that will remain in the business in the medium to long term,
accounted for in the business sheet

Cash-Flow Targets
A financial objective focused on maintaining a healthy cash balance
Cost Minimisation

The process by which businesses attempt to maximise profits by keeping…

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BUSS3

For example; marketing director or a finance director
Financial Strategy
The long term financial plan of action to achieve the financial objectives of the business
Gearing Ratio
The percentage of capital employed that comes from non-current liabilities
Gross Profit
Profit after cost of sales have been deducted
Gross Profit…

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Non-Current Assets

Items of value owned by the business that are likely to be kept for more than one year
Non-Current Liabilities

Debts that the business has more than one year to repay
Non-Executive Directors

A member of the board of directors who does not work for the business…

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Satisficing
Aiming to achieve a satisfactory level of profit

Shareholder Ratios
Ratios that help measure the value of the return received by shareholders

Shareholders' Returns
The financial rewards to a shareholder in return for their investment; this can include
dividends paid and increase share value

Sources of Finance
The…

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Offering a new product in a new market
Extrapolation

A prediction of a future based on an identified current trend

Market Analysis

A detailed examination of the features of a market size and sales used to predict future
trends

Market Development
Finding new markets for existing products either by…

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To replicate all elements of a product launch including promotion, distribution and price,
to a geographic region or demographic group to judge the viability of the product in the
market before a full scale launch

Trend
A general direction in which something tends to move
E.g. sales are increasing…

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BUSS3

Diseconomies of Scale

The disadvantages experienced by a firm as a result of operating beyond optimum output,
leading to a rise in average costs

Earliest Start Time

The earliest time an activity can start in a project based upon the completion of a
preceding activity

Economies of Scale
The…

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Latest Finish Time
The latest time an activity must be completed by to avoid any delay to the project

Lean Production

The adoption of techniques that help to reduce waste

Multinational
A business with operations or production bases in more than one country

Multisite Locations

A business that operates…

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The scientific research and technological development of a new product or process

Resource Mix

The combination of capital and human resources utilised within a business to achieve the
required output

Specialisation

The ability to employ specialists and for staff to focus on one particular area or function
Stakeholders

Any…

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