Business definitions

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Good
a physical product
1 of 150
Service
an intangle item
2 of 150
Gross domestic product
measures the total value of the production of an economy
3 of 150
Mission statement
sets out a business's overall purpose to direct and stimulate the entire organisation
4 of 150
Aims
Long term plans of the business from which its corporate objectives are derived
5 of 150
Objectives
medium to long term goald
6 of 150
Profit
The surplus of total revenue over total costs
7 of 150
Cash flow
The amount of money moving into and out of a business
8 of 150
Stakeholders
are individuals or groups with an interest in a business
9 of 150
Revenues
are the earnings or incomes generated by trading activities
10 of 150
Fixed costs
the costs that do not alter when the business alters its level of output
11 of 150
Variable costs
alter directly with output
12 of 150
Total costs
fixed costs+ variable costs
13 of 150
Average costs
total costs of production/ level of production to give the cost of producing a single unit
14 of 150
Sole trader
a business that is owned and managed by one person
15 of 150
Unlimited liability
The owner of a business can lose personal assets if the business fails
16 of 150
Company
organisation thta has its own legal identity and has limited liability
17 of 150
incorporation
the process of establishing a business as a seperate legal identity
18 of 150
Shareholder
An investor in and one of the owners of a company
19 of 150
Limited liability
The personal belongings are safe
20 of 150
Dividends
a share in the profits of a company
21 of 150
Market capitalisation
current share price x outstanding shares
22 of 150
Takeover
occurs when a company buys more than 50% of its share capital
23 of 150
Privatisation
the process under which the state sells businesses that it has previously owned and managed to private individuals
24 of 150
Reals incomes
incomes that are adjusted for the rate of inflation
25 of 150
Market conditions
refers to a number of features of a market such as the level of sales
26 of 150
Demand
indicate the amount of a particular good that consumers want
27 of 150
Interest rates
the price of borrowed money
28 of 150
Fair trade
a social movement that exists to promote improved trading terms and living conditions in less developed countries
29 of 150
Sustainable production
occurs when the supply of a product does not impose on future generations
30 of 150
Leadership
includes the functions of ruling, guiding and inspiring other people to pursue organisation objectives
31 of 150
Management
planning, organising, directing and controlling
32 of 150
Planning
setting objectives
33 of 150
Organising
decide land on which factory will be built
34 of 150
Directing
Motivation and communication
35 of 150
Controlling
setting standards using the companys objectives
36 of 150
Autocratic leadership
one way communication, close supervision, minimal delegation
37 of 150
Democratic leadership
delegation, employee participation, empowerment
38 of 150
Laissez- faire leadership
manager is one of subordinates, workforce is self motivated, workforces agrees with objectives
39 of 150
Authority
The power to carry through an action
40 of 150
Delegation
the passing down of authority down the organisational structure
41 of 150
Decentralisation
passing authority from the centre of an organisation
42 of 150
Programmed decision
familiar and routine decisions
43 of 150
Non programmed decision
less structured and require unique situations
44 of 150
Risk
the chance of incurring misfortune or loss
45 of 150
Uncertainty
the situation in which there is a lack of knowledge
46 of 150
Oppurtunity cost
the next best alternative foregone
47 of 150
Scientific decision making
based on data and uses logical, rational approaches
48 of 150
A decision tree
a model that represents the likely outcomes for a business of of a number of courses of action
49 of 150
Probability
the chance of a particular event occuring
50 of 150
Expected values
the financial outcomes from a specific course of action adjusted to allow for the probability of it occuring: probability x outcome
51 of 150
Net gains
expected values- costs
52 of 150
Ethics
moral principles which should underpin business decisions
53 of 150
The external environment
comprises of external forces that can influence a business's actions
54 of 150
Social responsibility
describes the duties a business has towards stakeholder groups such as employees
55 of 150
Communication
The exchange of information or ideas between two or more parties
56 of 150
Stakeholder engagement
a process by which managers involve individuals who may be affected by their decisions
57 of 150
Consultation
a process by which one groups discovers the views of another one
58 of 150
Relationship marketing
an approach to marketing in which a company seeks to build long term relationships by providing consistent satisfaction
59 of 150
Marketing objective
a target set for the marketing department
60 of 150
Sales value
measures the level of sales in a given period
61 of 150
Sales volume
the level of sales in a given period in terms of units sold
62 of 150
Market share
measures the sales of one brand or business as a percentage of total market sales
63 of 150
Sales growth
the percentage change in sales volume
64 of 150
Market growth
the percentage change in the total sales in the market
65 of 150
Internal influences
refer to factors within a business such as employees
66 of 150
External influences
refers to the factors outside a business such as the state of the economy
67 of 150
Globalisation
refers to increasing trade between countries and the growing internationalisation of businesses
68 of 150
Marketing research
involves gathering and analysing data relevant to the marketing process
69 of 150
Competitiveness
measures the extent to which a business offers good value for money relative to competitors
70 of 150
Primary market research
gathering data first hand
71 of 150
Secondary marketing research
uses data that already exists
72 of 150
Target population
all items or people that are relevant to the market research being undertaken
73 of 150
a sample
a group of people or items selected to represent the target population
74 of 150
Market mapping
analyses market conditions to identify the position of one product or brand relative to others in terms of criteria
75 of 150
Confidence level
the probability that the research findings are correct
76 of 150
Confidence interval
possible range of outcomes for a given confidence level
77 of 150
Brand
a promise of experience and conveys to a consumer a certain assurance
78 of 150
Patent
Protects new inventions
79 of 150
Trade mark
a sign which can distinguish the goods and services of a business from those of its competitors
80 of 150
Price elasticity of demand
measures how responsive demand is to changes in the price
81 of 150
Income elasticity of demand
how responsive demand is to changes in income
82 of 150
Big data
refers to large and complex data sets
83 of 150
Segmentation
occurs when similar customer needs are grouped
84 of 150
Market segments
groups of similar needs and wants within a market
85 of 150
Targeting
occurs when a business decides which segment it wants to operate
86 of 150
Niche marketing
focuses on a particular segment of the market
87 of 150
Mass market
aims to provide products that meet the needs of a large proportion of the market
88 of 150
Positioning
identifies the benefit and price combination of a product relative to competitors
89 of 150
Marketing mix
the comibination of marketing choices that can be used by a business to influence consumers to buy products
90 of 150
Consumer products
goods bought for consumption by the general product
91 of 150
A product life cycle
model shows the sales of a product over its life.
92 of 150
Product portfolio analysis
examines the market position of all the products of a business
93 of 150
The boston matrix
analyses all of a firms products in terms of their market share and the growth of the market
94 of 150
A balanced portfolio
an appropriate mix of products in terms of their market shares and market growth
95 of 150
Viral marketing
marketing technique that uses social media
96 of 150
Multichannel distribution
customers can buy the product in several ways
97 of 150
E- commerce
the buying and selling of products online
98 of 150
Operations management
describes activities, decisions and repsonsibilities of the managing production and delivery of products
99 of 150
Labour intensive
relatively high proportion of labour in the production
100 of 150
Capital intensive
uses relatively high proportion of capital equipment relative to labour
101 of 150
Supply chain
the series of activities ivolved in taking the initial resources to providing the final product
102 of 150
Operations objective
a target set for the operations department
103 of 150
Competitive advantage
a way in which a business offers superior value to its competitors
104 of 150
Unit costs
total cost/ number of units
105 of 150
Capacity
the maximum output of a business given its resources
106 of 150
Capacity utilisation
existing output/ maximum output x 100
107 of 150
Labour productivity
the amount of output per employee
108 of 150
Efficiency
measured by the inputs used to generate output. If it becomes more efficient it uses fewer inputs to produce a given output and unit cost should fall
109 of 150
Lean production
occurs when managers reduce waste
110 of 150
Quality
measured by the extent to which an operation meets its customer requirements
111 of 150
Quality assurance
the maintainence of target quality
112 of 150
Quality control
a system of maintaining standards by testing or inspecting the output against standards
113 of 150
Mass customisation
the term for producing on a large scale while still enabling preferences to be met
114 of 150
Inventory
the stock or goods a company holds
115 of 150
Vertical integration
the combination of two or more stafes of production normally operated by seperate companies
116 of 150
Outsourcing
when a business uses an outside supplier
117 of 150
Financial objective
a goal pursued by the financial function
118 of 150
income statements
record a business's sale revenues over a period and all relevent costs incurred as well as the business's profit
119 of 150
Gross profit
income received from sales - costs of goods sold
120 of 150
Direct costs
expenditure thta can clearly be linked to a particular product
121 of 150
Indirect costs
expenditure that relates to all aspects of a business's activities
122 of 150
Operating profit
the financial surplus arising from trading activities before taxation
123 of 150
Profit for the year
measure of a business's profits that takes into account all expenditures
124 of 150
Investment
the purchase of assets such as properties
125 of 150
Non current assets
items that the business owns and which it expects to retain for more than one year
126 of 150
Capital structure
refers to the way a business has raised the capital it requires to purchase assets
127 of 150
Budgets
financial plans that forecast revenue from sales and expected costs
128 of 150
Variance analysis
the process of investigating any differences between forecast data and actual figures.
129 of 150
Favourable variance
exists when the difference between the actual and budgeted figure will result in the business enjoying higher profits
130 of 150
Adverse variance
occurs when the differenc results in profits being lower than planned
131 of 150
Cash flow forecast
states the inflows and outflows of cash
132 of 150
Trade credit
the time given by suppliers before customers have to pay for goods
133 of 150
Break even output
the level of output or production at which total costs = revenue from sales
134 of 150
Contribution
revenue- variable costs
135 of 150
The margin of safety
measures the amount by which a business's current level of output exceeds break even level
136 of 150
Profitability
measure of financial performance that compares profits to other factors
137 of 150
Profit margin
a ratio that expresses profit as a percentage of its revenue
138 of 150
Internal source of finance
one that exists within a business
139 of 150
External source of finance
injection of funds from individuals
140 of 150
Short term finance
finance needed for a limited time
141 of 150
Long term finance
needed for a longer period of time
142 of 150
Bank loan
amount of money provided for a stated purpose
143 of 150
Overdraft
exists when a business is allowed to spend more than what it holds in its bank
144 of 150
Venture capital
funds advanced to businesses thought to be high risk in the form of a loan
145 of 150
Share capital
finance invested in a business as a result of the sale of shares
146 of 150
Debt factoring
the selling of a debt to get rid of it
147 of 150
Mortgages
long term loans, repaid of over long periods
148 of 150
Debenture
lons with fixed interest rates that are long term
149 of 150
Crowd funding
a practice of funding a project or venture by raising small amounts of money from a large number of people.
150 of 150

Other cards in this set

Card 2

Front

an intangle item

Back

Service

Card 3

Front

measures the total value of the production of an economy

Back

Preview of the back of card 3

Card 4

Front

sets out a business's overall purpose to direct and stimulate the entire organisation

Back

Preview of the back of card 4

Card 5

Front

Long term plans of the business from which its corporate objectives are derived

Back

Preview of the back of card 5
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