business com 2 eduqas

What are functional departments?

"Specialised sections of a business such as marketing

What are functional objectives?

The goals of each functional department that should be closely tied to the corporate objectives of the business.

What is marketing?

"The management process involved in identifying

What is product orientation?

An approach in which a business bases its marketing mix on what it sees as its internal strengths.

What is market orientation?

An approach in which a business bases its marketing mix on its perception of what the market wants.

What is asset-led marketing?

A business strategy based on the strengths or assets of the business rather than only on customers’ needs.

What is the marketing mix?

"The combination of product

What is a product portfolio?

The mix or range of products a business produces and sells.

What is a unique selling point (USP)?

Something that differentiates a product from its rivals.

What is branding?

"Using a name

What is penetration pricing?

Setting a low price to gain market share quickly.

What are price takers?

Businesses whose prices are largely set by the market through the interaction of supply and demand.

What is promotion?

An attempt through various forms of media to draw attention to a product and gain and retain customers.

What is above-the-line promotion?

Promotion through independent mass media channels that can reach a large audience.

What is a distribution channel?

The route or path taken by a product as it passes from producer to the final consumer.

What are agents?

People or businesses that do not take ownership of goods but represent the producer and try to gain sales.

What is industrial marketing?

Marketing goods and services to business customers rather than directly to final consumers.

What is a marketing budget?

"A budget that sets targets for the marketing department

What are clicks and bricks?

A situation where a business combines an online presence with physical stores or outlets.

What is viral advertising?

Social-media or online advertising that is rapidly shared from person to person.

What is m-commerce?

The buying and selling of goods and services through mobile devices.

What is budgeting?

"Financial planning for the future over a given period of time

What are sales revenue budgets?

Budgets setting out the planned revenue from sales.

What are expenditure budgets?

"Budgets setting out planned spending on labour

What is zero budgeting?

A budgeting method where managers start from a clean sheet and justify all expenditure.

What is working capital?

The money needed to finance the day-to-day running of the business.

What is investment capital?

Finance used to help the business grow.

What is capital expenditure?

Spending on fixed assets such as buildings and equipment.

What is a loan?

Borrowing a fixed amount for a fixed period of time.

What is an overdraft?

"A facility allowing more to be withdrawn from an account than is in it

What is trade credit?

Buying goods or materials now and paying for them later.

What is factoring?

A method of turning invoices into cash.

What is leasing?

Gaining the use of a productive asset without owning it.

What is a cash flow forecast?

A prediction of the movement of cash into and out of a business over a period of time.

What is net cash flow?

The difference between total cash receipts and total cash payments in a period.

What is a closing balance?

The opening balance adjusted by the net cash flow for the period.

What is a profit and loss account?

An accounting statement showing a business’s sales revenue over a period and the costs incurred in earning that revenue.

What is gross profit?

Sales revenue minus cost of sales.

What is net profit?

Gross profit minus expenses.

What are profitability ratios?

Ratios used to measure the income and operating success of a company over a period of time.

What is flexible working?

Working arrangements that allow employees some flexibility in the hours or time they work.

What is job sharing?

A working arrangement in which two people share one full-time job.

What are business aims?

Broad long-term intentions that set out what a business wants to achieve.

What are business objectives?

Specific and measurable targets set by a business to help achieve its aims.

What is a vision statement?

A description of what a business seeks to achieve in the medium to long term.

What is a mission statement?

A broad statement of an organisation’s aims and values that guides operations and decision-making.

What does SMART stand for?

"Specific

What is productivity?

Output produced in relation to the inputs used.

What is window dressing?

Techniques used to improve the apparent financial position or liquidity of a business.

What are debtors?

People or organisations that owe the business money.

What are trade creditors?

"Businesses or organisations to which the business owes money

What are drawings?

Money taken out of the business by the owner for personal use.

What is a budget?

A financial plan for the future.

What is a variance?

Any difference between the budgeted figure and the actual figure.

What is a favourable variance?

"A variance that improves profit compared with the budget

What is an adverse variance?

A variance that worsens profit compared with the budget.

What is cost benefit analysis (CBA)?

"A method of comparing the costs and benefits of an investment project in financial terms

What is critical path analysis (CPA)?

A method of planning and controlling large projects to manage time and resources.

What is the critical path?

The sequence of activities that cannot be delayed without delaying the whole project.

What is float?

The amount of time an activity can be delayed without delaying the completion of the project.

What does EST mean?

Earliest start time.

What does LFT mean?

Latest finish time.

What are strategic decisions?

Long-term decisions that affect the overall direction of the whole business.

What are tactical decisions?

Medium-term decisions used to implement strategic decisions.

What are operational decisions?

Day-to-day short-term decisions made in the running of the business.

What is a decision tree?

A method of tracing the possible outcomes of different decisions.

What is depreciation?

The fall in the value of a fixed asset over time due to use or obsolescence.

What is the straight-line method of depreciation?

A method that assumes a fixed asset loses an equal amount of value each year over its useful life.

What is investment appraisal?

A technique used to evaluate planned investment and measure its likely value to a business.

What is payback period?

The time taken for an investment to recover its original cost from net cash inflows.

What is average rate of return (ARR)?

An investment appraisal method measuring average annual profit as a percentage of the original investment.

What is discounted cash flow (DCF)?

An investment appraisal method that takes account of the time value of money by discounting future cash flows.

What is sales forecasting?

"The prediction of future sales revenue using past data

What is a three-year moving average?

A forecasting technique that smooths sales data by averaging values over three years.

What is qualitative sales forecasting?

Forecasting that considers non-numerical influences as well as figures.

What is rationalisation?

The reorganisation of a business in order to increase efficiency.

What is outsourcing?

Using outside suppliers to carry out activities that could be done internally by the business.

What are special orders?

Unexpected orders from a new customer or for a new product that require a decision on whether to accept them.

What is contribution?

The difference between sales revenue and variable costs.

What is strategy?

The way a business operates in order to achieve its aims and objectives.

What is implementation?

Putting a strategy or plan into practice.

What is SWOT analysis?

A method of analysing a business’s internal strengths and weaknesses and external opportunities and threats.