Enterprise (AS Level) - Section 1: Business and its environment

Vocabulary flashcards covering key terms from the lecture notes on enterprise, business environment, and entrepreneurship.

Entrepreneur

An individual who has the idea for a new business, starts it up, bears most of the risks, and benefits from the rewards.

Customer

An individual, consumer or organisation that purchases goods or services from a business.

Consumer

An individual who purchases goods and services for personal use.

Enterprise

The action of showing initiative to take the risk to set up a business.

Consumer goods

Physical and tangible goods sold to consumers that are not intended for resale (e.g., cars, food).

Consumer services

Non-tangible products sold to consumers not intended for resale (e.g., hotel stays, insurance, train journeys).

Capital goods

Physical goods used by industry to aid production, such as machines and commercial vehicles.

Factors of production

The resources needed to produce goods or services: Land, Labour, Capital and Enterprise.

Land

Natural resources and space used for production.

Labour

The workers; manual and skilled labour that make up the workforce.

Capital

Finance, machinery and buildings used to produce goods and services.

Enterprise (factor of production)

The initiative and coordination provided by risk-taking individuals (entrepreneurs) who combine the other factors.

Branding

The process of differentiating a product by developing a symbol, name, image or trademark.

Added value

The difference between the cost of purchasing inputs and the selling price of the finished goods.

Adding value

The process of turning inputs into goods or services that customers are willing to pay more for.

Opportunity cost

The next most desirable option that is given up when a choice is made.

Business plan

A written document describing a business, its objectives, strategies, market and financial forecasts.

Intrapreneur

A business employee who takes direct responsibility for turning an idea into a profitable new product or business venture.

Multinational business

A business organization with its headquarters in one country but operating branches, factories and assembly plants in other countries.

Local business

A business that operates in a small, well-defined part of a country and may not expand nationally.

National business

A business with branches or operations across a country.

International business

A business that sells products in more than one country.

Dynamic business environment

An environment that is constantly changing due to factors like competition, laws, economy and technology, requiring adaptation.

Risk

The possibility that a decision may not achieve expected outcomes; can be managed and assessed.

Uncertainty

Events or outcomes that cannot be foreseen, measured or predicted.

Barriers to entrepreneurship

Obstacles such as lack of opportunity, insufficient finance, high location costs, competition and acquiring a customer base.

Finance

Money available to start or grow a business; a key barrier and a resource to manage.

Marketing

The process of identifying customer needs and promoting and selling products to meet those needs.

Human resource management (HRM)

Management of the workforce: hiring, training, development and welfare.

Operations

The management of the production process to turn inputs into goods and services.

Executive summary

A concise overview of the business and its strategies within a business plan.

Marketing strategy

Details of why customers will buy the product and how the business will sell to them.

Management team and personnel

Details of the entrepreneur’s skills and the people to be recruited.

Premises

The location and facilities used for business operations and production.

Financial forecasts

Projected future sales, profits and cash flow for at least one year ahead.