Business Flashcards
Advertising
A method of communicating information about the product; the businesspays for advertising time/space
Aim
The intention to reach a goal
Air pollution
The presence or introduction of harmful substances into the air causing disease, allergies or damage to humans, animals, plants or the built environment.
Asset
Something the business owns; is has value
Average rate of return
The avrage profit for the year as a percentage of the original investment. Average rate or return=average return per annum/initial x 100
Boston Matrix
A tool for analysing the contribution made by each product in a business’ product portfolio. It plots each product’s position to its market share and the rate of growth of the market.
Brand Image
The comsumers’ perception of the brand; its charecter, qualities and shotcomings. It is developed over time and operates as a consistent theme through advertising campaigns.
Break-even chart
A diagrammatic representationof the costs and revenue for a product; it plots total costs against total costs against total sales revenue, showing the break-even point where they cross.
Break-even output
The point at which the business’ total sales equals the total costs. There is neither profit nor loss.
Buffer stock
A stock of raw materials held in reserve to protect the production process from unforeseen shortages.
Cash
Money that business has in cash or at the bank
Cash flow forecast
A financial planning tool that estimates the money coming into and going out of the business on a month-by-month basis; it allows the bussiness to predict times when additional finance may be needed to maintain liquidity.
Cash inflow
Money paid out by the business to fund its operations or investment activities
Cash outflow
Money paid out by the business to fund its operations or investment activities
Centralisation
Maintaining control by keeping authority at senior levels of the organisation
Chain of command
The line through the hirearchy that shows whomis responsible for whom from top to bottom of an organisation
Channels of distribution
The route the ownership of the product transfers from the seller to the buyer; it may be a single transaction or pass through others such as whole salers, distributors, agents and retailers
Closing balance
The amount that remains in the account at the end of an accounting period.
Commision
An amount of money paid to an employee that is based on a percentage of the sales he/she achieved; paid in addition to a basic salary.
Competition
The rivalry between businesses looking to sell their goods/services in the same market
Competative pricing
Setting the price of a product so that itis in line with competitors’ prices
Consumer law
Laws designed to ensure that businesses make products that are safe and of good quality, and that they deal with customers honestly and fairly.
Consumer spending
The money spent by households on goods and services to satisfy their needs and wants.
Contracts of employment
A legal document that sets out the terms and conditions of the job for the employer and the employee.
Coat
The money spent by a business on goods and services.
Cost-plus pricing
Setting the price of a good or service at an amount higher than the cost of producing it so that a profit is made.
Customer
Individuals, businesses or organisations that purchase goods/services and make decisions about which supplier to choose.
Customer engagement
The relationship between the business and the customer that puts the customer’s requirements at the centre of the operation to build brand loyalty.
Customer loyalty
he likelihood that past customers will continue to buy from the business, enhanced by high quality customer service and/or reward programmes.
Customer satisfaction
Whether customers are pleased with the goods/services they receive; whether they would purchase again.
Decentralisation
Where authority is spread widely through the organisation.
Delayering
The reorganisation of the organisation’s employees so that there are fewer levels of management
Delegation
Allocating a task to someone who would not normally be responsible for it.
Demand
The quantity of a particular product that will be bought at particular price over a specific time.
Directors
The people who are elected by the shareholders to run the business on their behalf.
Diseconomies od sale
When a business grows too large, leading to a possible increase in unit cost.
Disposal of waste
The removal, storage or destruction of unwanted material. Methods include recycling, burning and landfill sites.
Dividend
A portion of the after-tax profit that is paid to shareholders according to the number of shares they own
E commerce
Business transactions carried out electronically on the internet.
Econimies of scale
The cost advantage of producing on a large scale. As output increases the unit cost decreases.
Employees
Individuals who work full time or part time for the business; they have a contract of employment detailing their duties and rights.
Employment law
Rulings that relate to the rights and responsibilities of people who work for a business; they affect the recruitment and selection process and how the business deals with its workers.
Enterprise
The ability to identify business ideas and opportunities to bring them to fruition and to take risks where appropriate.