2.1 Growing the business Flashcards
(22 cards)
Innovation
Innovation: bringing a new idea to the market,
Inorganic growth
Inorganic (external) growth: growing by buying
up other businesses or by merging with a
business of roughly equal size.
Organic growth
Organic (internal) growth: growth from within
the business, such as creating and launching
successful new products.
Research and development
Research and development (R&D): the scientific
research and technical development needed to
come up with successful new products.
Takeover
Takeover: obtaining control of another business by buying more than 50 per cent of its share capital.
Flotation
Flotation: listing company shares on the stock market, allowing anyone to buy the shares. This means the price can fl oat freely (up and down).
Public limited company
Public limited company (plc): a company with at least £50,000 of share capital that can advertise its shares to outsiders and is, therefore, allowed to fl oat its shares on the stock market.
Entering markets
Entering markets: when a company decides
to open up in a market it hasn’t been in
before, for example Walkers launching
cereal bars.
Exiting markets
Exiting markets: choosing to leave a market,
probably because it was loss-making and
looked set to continue.
Competing internationally
Competing internationally: finding a way to succeed against rivals from overseas.
Free trade
Free trade: trade between countries with no barriers, for example no tariffs.
Globalisation
Globalisation: the increasing tendency for countries to trade with each other and to buy global goods, such as Coca-Cola, or services, such as Costa Coffee.
Imports
Imports: goods or services bought from overseas.
Tariffs
Tariffs: taxes charged only on imports.
Trade blocs
Trade blocs: a group of countries that have agreed to have free trade within external tariff walls.
Ethical considerations
Ethical considerations: thinking about ethics,
which may lead to morally valid decisions or
may lead to the manipulation of customer
attitudes (that is, pretending to be ethical).
Ethics
Ethics: weighing up decisions or actions on the
basis of morality, not personal gain.
Fair trade
Fair trade: a social movement whose goal is to
help producers in developing countries achieve
better trading conditions and to promote
sustainability. It ensures that the price paid
is high enough to allow fair wages to be paid
to the workers who produced it.
Trade-offs
Trade-offs: how having more of one thing may
force you to have less of another; for example,
higher ethical standards may mean less profi t.
Environment
Environment: the condition of the natural world
that surrounds us, which is damaged when
there’s pollution.
Environmental considerations
Environmental considerations: factors
relating to ‘green’ issues, such as sustainability
and pollution.
Sustainability
Sustainability: whether or not a resource will
inevitably run out in the future; a sustainable
resource will not.
