FBLA Entrepreneurship Vocab

business plan

carefully constructed guide for the person starting one's own business and lays out the strategy for an organization to make the best of its resources and advantages to meet its objectives

Theory X managers

they place little value on organizational climate

Federal Trade Commission

five-member committee charged with the responsibility of investigating illegal trade practices and enforcing antitrust laws

management by objectives

a motivation process in which a manager and his/her employees collaborate in setting employee work goals

market share

total company dollar sales divided by total industry dollar sales

Sherman Antitrust Act

act that specifically prohibits any contract or agreement entered into for the purpose of restraining trade

undercapitalized

what an enterprise is considered when an entrepreneur is unsuccessful in obtaining the resources needed to successfully complete the business' objective

Uniform Commercial Code

a set of laws designed to eliminate differences among state regulations affecting business and to simplify interstate commerce

Age Discrimination in Employment Act

law that prohibits personnel practices that discriminate against people ages 40-60

Theory Y managers

they believe people prefer indirect supervision and assume workers are most motivated by money

Small business

a business that has less than 500 employees (or 1,500, according to the government)

royalty

a share of profits or a percentage commission on sales that a franchisee must pay the franchiser

ISO 9000

a set of international standards for quality management and assurance

dumping

a kind of predatory pricing when manufacturers export a product to another country at a price below the normal price

licensing

a business arrangement in which one company gives another company permission to manufacture its product for a specified payment

merger

two companies combine to form one

corporate responsibility

a corporation's initiatives to assess and take responsibility for the company's effects on environmental and social wellbeing

corporate philanthropy

the act of a corporation promoting the welfare of others, generally through charitable donations of funds or time

corporate policy

a formal declaration of the guiding principles and procedures by which a company will operate typically established by its board of directors

corporate nationality

the nationality of the senior managers or the shareholders who control the operation, or the country where most of the business is done

corporate philosophy

the fundamental thoughts related to a company, covering the vision, values, and a mission

corporate structure

consists of various departments that contribute to the company's overall mission and goals

lienholder

a party that holds a mortgage or a legally enforceable right on a specific asset, good, or property of another as a security for a debt or to satisfy a claim

stakeholder

a party that has an interest in a company, and can either affect or be affected by the business, primarily investors, employees, and customers

stockholder

an individual, group, or organization that holds one or more shares in a company, and in whose name the share certificate is issued; also called a shareholder

leaseholder

a person in possession of leasehold property, or a tenant under a lease

common law

a body of unwritten laws based on precedents established by the courts

statutory law

a body of law consisting of written laws adopted by a legislative body

business law

rules, statutes, codes, and regulations established to provide a legal framework within which business may be conducted

tort

a wrongful act or an infringement of a right (other than under contract) leading to civil legal liability

uniform commercial code

a set of laws designed to eliminate differences among state regulations affecting business and to simplify interstate commerce

bankruptcy

the legal process by which an individual is relieved of his or her financial obligations by a court of law

limited partner

a partner who invests money in a business but does not take an active role in management or assume liability

franchise agreement

an arrangement where someone with a good idea for a business sells the rights to use the business name and sell a product/service to others in a given territory

enterprise zones

areas that feature low taxes and government support in an effort to encourage entrepreneurship

management

the process used to accomplish organizational goals through planning, organizing, leading, and controlling people and resources

mission statement

outlines the fundamental purposes of the organization

trade show

an event where marketers set up displays to be seen by potential customers

intrapreneur

a manager or employee within a company who promotes innovative product development and marketing.

economy of scale

manufacturing costs fall as the number of units produced increases

cash budget

the most important part of the small business financial plan that tells how much money is needed to operate a new business

venture capitalist

a small investor seeking to make a profit on companies with rapid growth potential

job analysis

the systematic collection and recording of information about jobs in an organization

Equal Pay Act

the act that makes sure firms are paying men and women the same if they are doing the same job

Active Corps of Executives (ACE)

made up of managers in the workforce

Small Business Administration (SBA)

an organization that helps entrepreneurs obtain money

Small Business Institute (SBI)

an organization that might involve students at a university who help small businesses

Service Corps of Retired Executives (SCORE)

retired executives who provide free advice to small businesses

service industry

an industry that appeals to the talent for innovation that is found in most entrepreneurs and requires few start-up resources; also the fastest growing segment of small business enterprises; offers a high return on time invested

retailing industry

an industry where entrepreneurs fill some niche or provide a product that is not readily available

finance industry

an industry that has had a reduced number of businesses due to deregulation

wholesaling industry

an industry in which the success of a small business is linked to economy of scale

borrowing

this act allows others to retain control of a company

tax incidence

refers to who actually pays the tax

operating model

a methodology that describes the way every aspect of the business is to be run

factoring

when a small business sells its accounts receivable to a finance company

equipment and buildings

the assets most commonly used for security by asset-based lending companies

Section 1244 stock

stock that can be treated as an ordinary tax-deductible loss

Form W4

a form filled out by an employee that provides the information you needed to determine the proper amount to withhold from your paycheck

bait advertising

this practice attempts to conceal product defects

Federal Deposit Insurance Corporation (FIDC)

the federal agency that helps to regulate banks and other financial institutions

Sherman Act

the antitrust law that makes it illegal for a business to charge different prices to different groups of non-retail consumers

Equal Credit Opportunity Act

the law which states you have a right to know what information is included in your credit history

cash conversion period

the time between a cash payment for inventory and collection of accounts receivable

headhunter

recruiting specialists that help small businesses seek personnel for key positions

profit plans

a way for small firms to give employees a share of ownership in the business

social discount rate

a discount rate used to calculate the value of funds spent on social projects

cost benefit analysis

an approach to compare costs and benefits of different options in order to pick the one that benefits the most but costs the least

bear market

recession; a market in which prices are falling which encourages selling

seniorpreneur

someone who starts a business after the age of 55

copreneur

someone who works with the entrepreneur, like a spouse, accountant, or supplier

business entrepreneurs

entrepreneurs who are constant innovators driven by profit; always trying to get larger market shares and creating one venture after another

social entrepreneurs

entrepreneurs who are driven by a mission to solve problems that are not being addressed by the market or public sector

small business owner

initially an entrepreneur; often they like stable sales, modest growth, and a manageable business size

macro view of entrepreneurship

external factors affecting entrepreneurship; includes social/cultural, financial/capital, displacement, and ecological schools of thought

micro view of entrepreneurship

internal factors affecting entrepreneurship; includes entrepreneurial trait, venture opportunity, and strategic formulation schools of thought

mountain gap strategy

identifying market segments that arise from larger markets

great chef strategy

using special talents of the individual(s) around whom the venture is built

better widget strategy

innovations that encompass new or existing markets

water well strategy

ability to gather special resources over the long term

Global Entrepreneurship Monitor (GEM)

international study of entrepreneurship

gazelle

a business with at least 20% sales growth every year with a starting base of at least $100,000; has good scalability, competitive advantage, and is 10x better than another company

opportunity-driven entrepreneurs

entrepreneurs driven by job satisfaction, achievement, opportunity, and money

necessity driven entrepreneurs

entrepreneurs driven by needs or problems not being addressed

entrepreneurial cognition

knowledge structures that people use to make assessments involving opportunity evaluation, venture creation, and growth

entrepreneur life cycle

preparation -> startup operations -> exploration -> focus and expansion -> cessation/inheritance

norm entrepreneurs

entrepreneurs who transform the rules so that mutual cooperation is more desirable

triple bottom line (TBL)

profit, planet, people; goals associated with businesses engaged in eco-friendly policies and community outreach, usually looked down upon by other businesses

laissez faire

economy where the government stays out of the market

corporate social responsibility (CSR)

the belief that a company needed to align its operations with social values

bootstrapping

starting a new venture through highly creative acquisition and use of resources (sometimes other people's)

cash flow

money moving in and out of a business

liquidity

availability of liquid assets in a market or company

disruptive startup

startups that drive less innovative products out of the market or increase efficiencies in the market

new-new approach

a completely new product or idea

new-old approach

a business venture that builds upon another

upside gain and downside loss

profits a business can make and losses it can suffer

risk vs reward analysis

analysis of overall gains and losses

advantages of acquiring an ongoing venture

less fear about successful future operation, reduced time and effort, and a good selling price

legal restraint of trade

an agreement that prevents the former business owner from setting up a similar business and attract his former customers from the new owner