Key terms for the WDP case study

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  • Created on: 06-06-10 13:52
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Webdespix Ltd Key Terms
Private limited company (ltd):- A business with at least 2 plus (TOM & DEE) shareholders. Shares are
sold privately as they cannot be sold on the Stock Exchange, however the shareholders still benefit
from limited liability.
Non- executive chair: - a part-time officeholder who sits on and chairs the main board of the
company. John also provides support and advice to the CEO (Chief Executive officer).
Re-invest profits (retained profits):- Profits which are kept in WDP for use in the future investment
projects. This is a cheap source of finance since it does not require interest to be paid.
Bank loan: - Allows individuals and businesses to borrow a fixed sum of money. The money has to be
repaid at a fixed time (monthly) and at a fixed rate of interest over a given period of time.
Bank overdraft: - A flexible short-term method of borrowing, it allows you to draw out more money
from your account than you have in it. They usually have higher rates of interest than a loan, but can
be used only when they are needed.
Capital: - Funds invested in a business. It can take the form of machinery as well as money.
Objectives:- these are the targets that the business sets itself. All objectives must be SMART­
Time constrained
Turnover (sales revenue):- The total value of the money received from sales within a trade period.
E-commerce:- When WDP use the internet to buy and sell goods and services e.g. Amazon, Tesco.
Branding:- Establishing an identity for WDP that seperates its services from other similar products.
Labour Intensive:- A business which uses labour as the main factors of production.
Overhead costs (fixed costs) :- These are costs which WDP must pay whatever the level of output.
Communication:- The transferring of a message from a sender to a receiver. It may be visual, written
or oral.


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