business key words LEM Flashcards
(200 cards)
1
Q
Market Size
A
measured by the volume or value
2
Q
Dynamic market
A
A market is subject to rapid or continuous change
3
Q
mass market
A
large market. where people buy the same/similar products
4
Q
Niche market
A
A subset of the main market which has specific needs
5
Q
Innovation
A
bringing a new idea into existence and using it
6
Q
Product innovation
A
Technologies to create new products or improve quality of existing ones
7
Q
Market share
A
percentage of the market owned by a business
8
Q
process innovation
A
Technology to improve production methods to reduce costs
9
Q
Competition
A
businesses that exist in the same market that are trying to attract the same customers by having lower prices, better quality, innovation, and greater efficiency
10
Q
risk
A
The outcome is known and can be quantified
11
Q
uncertainty
A
outcomes are unknown and cannot predicted
12
Q
product orientation
A
The product is the most important aspect of the business and is more important than the markets needs
13
Q
market orientation
A
The customer is the most important factor. the business focuses customers needs and wants
14
Q
primary research
A
collecting new data first hand
15
Q
Secondary research
A
gathering existing data second hand
16
Q
Quantitative data
A
numerical data
17
Q
Qualitative data
A
non-numerical data
18
Q
Bias
A
sample is not proportionate of a particular market segment
19
Q
market segmentation
A
away markets are divided each segment as different customer preferences
20
Q
Products differentiation
A
Business creates a distinctive product that has unique features
21
Q
market map
A
plots brands in the market according to how they meet customer needs using two criteria
22
Q
Competitive advantage
A
having an edge over rival products could be based on low costs or better quality
23
Q
Adding value
A
increasing the difference between selling price and cost of its material inputs
24
Q
Unique selling point
A
A distinctive feature that no product can match precisely
25
supply
Amount of a good or service that produces are willing to provide
26
equilibrium point
The quantity demanded is the same as the quantity supplied
27
elasticity
responsiveness to change
28
PED
The responsiveness of demand to a change in price
29
Price elastic
Price causes a change in quantity demanded beyond -1
30
unit price elasticity
Price change causes the same change in quantity demanded -1
31
Price in elastic
Price change does not affect the quantity demanded
32
YED
The responsiveness of demand to a change in income
33
Income elastic
income change causes a change in the quantity demanded
34
Unit income elasticity
same proportional change in quantity demanded and income 1
35
income inelastic
income does not affect quantity demanded
36
luxury good
demand increases as income increases
37
inferior good
demand decreases as income increases
38
design mix
Function, aesthetic and cost
39
social trends
way society as a whole behaved
40
branding
creating a positive and recognisable image of the business or product
41
promotion
informs customer of the product or service
42
product branding
single product is recognisable by that name
43
personal branding
individuals become their own brand
44
viral marketing
encourages individuals to pass on a marketing message to someone else.
45
emotional branding
brands that appeal to a customers emotional needs rather than their logical ones
46
pricing strategies
ways in which a business decides on the price of its product
47
cost plus pricing
adding a percentage markup to the average total cost
48
premium pricing
ability to charge higher prices than rivals without losing sales
49
Price skimming
charging a high initial price
50
competitive pricing
charging around the same price as competitors or basing prices on prices of competitors
51
penetration pricing
a low initial price is set to gain customers
52
psychological pricing
used to make the pricing more attractive than it really is
53
predatory pricing
prices set very low in order to destroy competition
54
distribution channel
route taken by the product as it moves from the producer to the customer
55
product life-cycle
Different stages of the product passes through
56
extension strategy
used one sales are slowing
57
product portfolio
range of products that business produces
58
Boston matrix
analyses companies products in terms of market share and growth potential
59
Star
product with significant market share in a fast growing market
60
problem child
small share of a fast growing market
61
Cashcow
large share of a slow growing market
62
dog
no share of a low growth market
63
Business to business
process of selling products or services to other businesses
64
Business to consumer
selling directly to the customers who are buying products for personal use
65
marketing objectives
Longer term marketing goals and targets
66
Flexible work
Workforce that can work flexible hours
67
Multi skilling
Training employees so they can do a range of tasks
68
Flexible hours
Requires employees to work a certain number of hours but the employees can choose their hours
69
Outsourcing
Businesses tasks or processes are undertaken by an external provider or third party
70
Dismissal
The work is sacked
71
Redundancy
When the worker is no longer of use to the business
72
Individual approach
Direct discussions between an employer and individual
73
Collective bargaining
Discussions between employers and representatives of employees e.g. a trade union
74
Internal recruitment
Recruiting someone from within the business
75
External recruitment
Candidates are found from outside of the business
76
Labour turnover
Rate at which staff leave the business
77
Induction
Training given to new employees to familiarise them with the work environment
78
Organisational structure
Framework which shows how a business arranges his lines of authority
79
Hierarchy
employs ranked in layers displaying the levels of authority
80
delayering
taking out a layer of management
81
span of control
Number of people that are answerable to one person in the chain of command
82
centralised structure
decision-making is at the top of the hierarchy
83
decentralise structure
decision making is delegated to people below the top of the hierarchy
84
Matrix structure
individuals are assigned to teams according to their specialism
85
Taylors scientific management
Close supervision and financial motivation
86
Mayo’s human relations
addressing the human needs social and psychological factors
87
Maslow‘s hierarchy of needs
physiological, safety, social, esteem, self actualisation
88
Herzberg’s two factor theory
motivating factors and hygiene factors
89
Delegation
Allowing decisions to be taken at a lower level
90
Empowerment
giving employees more individual responsibility to carry out their tasks
91
Leadership
Motivate team and organising a group of people to achieve a common goal
92
Autocratic
Top down decisions without consultation
93
democratic
Guide rather than dictate consulting widely and encouraging employees to participate in decision-making
94
Paternalistic
consult earlier on and take employees thoughts into account
95
laissez faire
Set the initial agenda and give staff complete freedom to complete the task
96
Profit maximisation
Making as much money as possible
97
Profit satisfaction
Making enough profit to continue in the business
98
Business objectives
Goals and targets that the business needs to achieve in order to make progress towards the long-term aim
99
Entrepreneur characteristics
hard work, motivation ,risk-taking, creativity, initiative
100
Sole trader
Self-employed and run the business unlimited liability
101
Partnership
Two more people working together unlimited liability
102
Limited company
Owned by shareholders
103
Opportunity cost
Cost of giving up something in order to do something else
104
Trade-off
Occurs when two things cannot both be fully achieved
105
Acid test ratio
(Current assets-inventories)/current liabilities
106
assets
Resources owned by business
107
Balance sheet
Financial document summarising networthof a business records assets and liabilities not to do with profit
108
Batch production
Makes a limited number of identical product then stops to re-organise and make a batch of something else
109
Boom
Time of rapid growth and expansion in the economy
110
Break even
Total sales revenue equals total costs no profit is lost or made
111
Breakeven output
Fixed costs/contribution per unit
112
Budgets
Financial plan concerning revenue and cost of a business provides targets for cost revenue
113
Buffer stock
Level of stock kept just in case
114
Business cycle
Boom, downturn, recession, recovery
115
Business plan
Document setting out strength aims and strategies of a business used for gaining finance
116
Capacity
Measures the maximum amount of output affirm can produce
117
Capacity utilisation
(Current output/maximum possible output) X 100
118
Capital
Funds provided by the shareholders to set up the business, fund expansion and purchase fixed costs
119
Capital expenditure
Spending on business resources that can be used repeatedly over a period of time
120
Capital intensive
Businesses that rely more heavily upon capital equipment
121
Cartels
agreements between two or more firms to fix prices or carve up markets or reduce output
122
Cash flow
Flow of money in and out of the business in a period of time
123
Cash inflow
Money coming into the business
124
Cash outflow
Money going out of the business
125
Cell production
Work is organised into teams teams are giving responsibility of doing a part of the production process
126
Collateral
Asset that might be sold to pay a lender when a loan can’t be repaid
127
Consumer protection act
Designed to make sure the products reach a reasonable level of safety
128
Contingency plan
Devised in advance to cope with a range of possible situations
129
Contribution per unit
Selling price -variable cost per unit
130
Current ratio
Current assets/current liabilities
131
Direct taxation
Income tax, national insurance and corporation tax
132
Downturn
Boom slows and the rate of growth decreases
133
Economic. forecasting
Process of predicting future economic variables and events
134
Economies of scale
Spreading fixed costs over many products
135
Efficiency
Making best possible use of all business resources
136
Efficiency equation
Total production cost/total output
137
Exchange rate
Strong pound equals cheaper import week pound equals cheap export
138
External finance
Funded from outside the business
139
Extrapolation
Assuming the past trends will continue into the future
140
Fiscal policy
Government adjust its spending levels and tax rates to monitor and influence the national economy
141
Fixed costs
Costs that do not change when output changes
142
Flow production
Producing as many identical products as possible for mass-market product moves continuously through production process
143
Forecasting
Assessing the probable outcome using assumptions about the future
144
Gross profit margin
Gross profit/revenue x 100
145
Income statement
Financial document summarising businesses trading activity and expenses sure if it made profit or loss
146
Incorporated business
Business model in which the business and owners have separate legal entities
147
Indirect taxation
VAT, excise duties, car tax etc
148
Inflation
Sustained increase in the average price level in the economy the value of money falls
149
Insolvency
When the company can’t pay its debts because it’s making a loss
150
Interest rate
Price of boring money
151
Internal finance
Money generated by the business or current owners
152
Job production
Making one thing at a time used for individual unique products for consumers special needs
153
Just in time
stock control system that does not hold stocks. stocks arrive as they are needed
154
Kaizen
A system of continuous improvement every stage of production
155
Labour intensive
Businesses that rely more heavily on the workforce rather than capital equipment
156
Lead time
Time taken between the idea for a product and it’s been ready for sale
157
Lean production
Production that tries to minimise waste during the production process
158
Liabilities
Depts of the business
159
Limited liability
Shareholders can only lose the original amount they invested
160
Liquidity
Ability to convert an asset into any form without any delay cash is the most liquid acid
161
liquidity (amount)
Amount of cash that business has shows whether business compares debts
162
Long-term finance
Money borrowed for more than one year
163
Monetary policy
Management of money supply and interest rates by the government
164
Net assets
Total assets minus total liabilities
165
Net profit margin
Net profit/revenue X 100
166
Operating profit margin
Operating profit/revenue X 100
167
Outsourcing
Business by some inputs from other businesses
168
Overtrading
A business expands too quickly and tries to engage in more business than the investment in working capital will allow
169
Productivity
Output per input per hour
170
Profit
Difference between total cost in total revenue
171
Quality assurance
Takes customers needs into account and involves employees and looking at every aspect of the business
172
Quality circles
Small groups employees that meet regularly to look at how quality can be improved
173
Quality control
Traditional method of checking the products are of a good enough standard
174
Recession
Two consecutive quarters of negative growth
175
Recovery
Positive growth returns
176
Regulation
Government rules that set standards for organisations protect consumers employs and environment
177
Revenue expenditure
Spending on business resources that have already been consumed or shortly will be
178
Rights issue
Issuing new shares to existing shareholders at a discount
179
Sale of goods act
Prevents businesses from misleading consumers by claiming qualities they do not possess
180
Sales forecast
Projection of future sales revenue based on previous sales data or market research
181
Sales revenue
Price X quantity sold
182
Sales volume
Quantity of output sold in a particular period of time
183
Short-term borrowing
Money borrowed for 12 months or less
184
Stock control charts
Overall objective of stock control is to maintain stock levels so the total cost of holding stock is minimised
185
Total contribution
Contribution per unit X number sold
186
Total cost
Entire cost of producing a level of output
187
Total equity
Total amount invested into the business from share capital and retained profit
188
Total quality management
System whereby everybody throughout the business takes responsibility for quality
189
Trade descriptions act
Illegal to make misleading or not your claim is that a product or service
190
Trend
Patterns indicated by figures of sales
191
Undercapitalised
Business isn’t raising enough capital when setting up
192
Unincorporated business
Business model in which she has no legal differences between owners and the business
193
Unlimited liability
Legal status which means the business owners are liable for all business debts
194
Variable costs
Costs that rise as output rises
195
Variance analysis
Calculating and investigating the differences between actual results and the budget
196
Venture capital
Specialist providers of funds for small or medium size companies
197
Waste minimisation
Seeks to increase productivity by examining every stage of production to see if they can be improved
198
Working capital
Current assets minus current liabilities. Pays for day-to-day running costs such as wages and sales on credit
199
Zero-based budgeting
No budget is set and no money is allocated to cover costs
200
Stock
Product held by firm to enable production
