Business Studies: Key Concepts

A comprehensive set of vocabulary flashcards covering key terms across operations, marketing, finance, and human resources, designed for exam preparation.

Operations Management

The business function responsible for converting inputs into outputs and managing production efficiency, cost and quality.

Inputs

Resources such as raw materials, labour, and equipment used in the production process.

Transformation

The conversion of inputs into finished goods or services.

Outputs

The final goods or services delivered to the customer, including warranties and after-sales service.

Productivity

A measure of the efficiency of production, usually expressed as output per unit of input.

Competitive Advantage

A feature that allows a business to outperform rivals, often through lower cost or product differentiation.

Cost Leadership Strategy

Competing by aiming to be the lowest-cost producer in an industry.

Product Differentiation

Distinguishing a product from competitors through unique features, quality or customisation.

Goods

Tangible, physical products that can be touched, stored and owned.

Services

Intangible products that exist only while being performed and are usually customised and labour-intensive.

Zoning

Local government regulations that restrict where certain businesses may operate.

Work Health and Safety Act 2011 (NSW)

Legislation that sets general safety requirements for all workplaces in NSW.

Quality Management

Strategies used to ensure products meet customer expectations; includes QC, QA and TQM.

Quality Control (QC)

Inspection-based approach that detects defects during the production process.

Quality Assurance (QA)

Proactive system that sets standards and prevents defects before they occur.

Total Quality Management (TQM)

Whole-business commitment to continuous improvement and defect-free production.

Marketing

The process of planning, pricing, promoting and distributing products to satisfy customer needs profitably.

Market Analysis

Collecting and evaluating information about market conditions, customers, opportunities and threats.

Target Market

A group of customers with similar characteristics that a business aims to serve.

Mass Marketing

Strategy that targets the entire market with one marketing mix.

Market Segmentation

Dividing a market into distinct groups with common characteristics for targeted marketing.

Niche Marketing

Focusing on a narrowly defined, often small market segment.

Marketing Mix

Combination of product, price, promotion and place strategies used to reach target markets.

Product (Marketing Mix)

The good or service offered, including features, quality, branding and packaging.

Branding

A name, term, symbol or design that identifies a product and differentiates it from competitors.

Packaging

The container and graphic design used to protect and promote a product.

Price (Marketing Mix)

The amount of money charged for a product, affecting sales volume and profit.

Cost-Based Pricing

Setting prices by adding a markup to the cost of production.

Market-Based Pricing

Setting prices according to supply and demand levels in the market.

Competition-Based Pricing

Setting prices below, equal to or above competitor levels.

Promotion

Activities that create awareness and persuade consumers to purchase a product.

Place (Distribution)

Methods of making a product available to customers, including channels and logistics.

Equity Finance

Funds provided by owners or shareholders; does not require repayment or interest.

Owners’ Equity

Capital contributed by the business owner from personal funds.

Retained Profits

Earnings kept in the business instead of being distributed to owners/shareholders.

Debt Finance

Borrowed funds that must be repaid with interest.

Overdraft

Short-term debt allowing a business to withdraw more money than is in its bank account.

Commercial Bills

Short-term, large-sum loans issued by financial institutions to businesses.

Factoring

Selling accounts receivable to a finance company for immediate cash.

Mortgage

Long-term loan secured by property, commonly used for land or buildings.

Debenture

Long-term loan issued by a company to investors at a fixed rate of interest.

Unsecured Note

Long-term loan not backed by collateral, carrying higher risk and interest.

Cost of Finance

Total expense of obtaining funds, including interest for debt or dividends for equity.

Cash Flow Statement

Financial report summarising cash inflows and outflows over a period.

Liquidity

The ability of a business to meet short-term financial obligations.

Income Statement

Report showing revenues, expenses and profit (or loss) over a period; also called profit and loss statement.

Balance Sheet

Snapshot of a business’s assets, liabilities and owners’ equity at a specific point in time.

Assets

Items of value owned by a business.

Current Assets

Assets expected to be converted into cash within 12 months, e.g., inventory, accounts receivable.

Non-Current Assets

Assets that provide value for more than 12 months, e.g., land, machinery.

Liabilities

Debts or obligations owed by the business.

Current Liabilities

Debts payable within 12 months, e.g., overdrafts, accounts payable.

Non-Current Liabilities

Debts due after 12 months, e.g., long-term loans, mortgages.

Owners’ Equity

Residual interest in the assets of the business after liabilities are deducted.

Human Resource Management (HRM)

Managing the acquisition, development, maintenance and separation of employees to meet business goals.

Recruitment

The process of finding and attracting suitable candidates for job vacancies.

Internal Recruitment

Filling vacancies with existing employees within the business.

External Recruitment

Sourcing candidates from outside the business.

Job Analysis

Systematic study of a job’s duties, tasks and work environment.

Hard Skills

Specific, quantifiable technical abilities required for a job, e.g., coding, machinery operation.

Soft Skills

Interpersonal or emotional abilities, e.g., communication, teamwork, leadership.

Wage

Payment calculated on a time basis, such as hourly or daily rates.

Salary

Fixed regular payment agreed in an employment contract, not linked to hours worked.

Modern Award

Legal document setting minimum pay rates and employment conditions for an industry.

Enterprise Agreement

Workplace-level collective agreement on pay and conditions between employer and employees or their union.

Trend Analysis

Examining historical data to identify patterns and predict future business performance.

Critical Issues

Key factors that influence business success or failure, such as planning, finance and location.

Price/Cost Strategy

Competitive approach focusing on achieving the lowest production costs to offer lower prices.

Differentiation Strategy

Competing by offering unique product features, quality or service.

Over-Extension of Finance

Taking on more debt or financial commitments than the business can afford, risking insolvency.

Technology Adoption

Integrating new technological tools to improve efficiency and competitiveness.

Total Revenue

Total money received from sales of goods or services.

Cash Inflows

Money entering the business, for example from sales or asset sales.

Cash Outflows

Money leaving the business for expenses such as wages, stock purchases and loan repayments.

Liquidity Ratio

Financial metric used to assess a business’s ability to meet short-term debts.

Person Conducting a Business or Undertaking (PCBU)

Legal term under WHS law referring to employers and others responsible for workplace safety.

Consumer Law (Competition and Consumer Act 2010)

Federal legislation regulating fair trading, product safety, warranties and advertising in Australia.

Warranty

Promise to repair or replace a faulty product within a specified period.

After-Sales Service

Support provided to customers after they purchase a product, enhancing satisfaction and loyalty.

Channel Choice

Selection of distribution intensity: intensive, selective or exclusive placement of products.

Economies of Scale

Cost advantages gained when production becomes efficient through larger output.

Break-Even Analysis

Financial tool that determines the point where total revenue equals total cost.

Cash Flow Projection

Forecast estimating future cash inflows and outflows to aid budgeting.

Workplace Culture

Shared values, beliefs and behaviours influencing how employees interact and perform.

Flexible Work Practices

Arrangements such as remote work or flexible hours that can improve employee productivity and satisfaction.