A level Business Flashcards

Adverse varience

When actual costs are higher than budget costs

Autocratic

When the manager makes all the decisions

Bank overdraft

The amount that can be overspent on a bank account (be overdrawn)

Blake mouton grid

The concern for people and production a manager has

Boston matrix

Product portfolio analysis of a business into 4 categories

Branding

how consumers recognise and identify with a product

Break-Even

The point when total sales is equal to total costs

Budget

Income and costs predicted over a period of time

Buffer inventory

Minimum amount of stock a business requires to operate

Capacity utilisation

The amount of total capacity is being used

Cash flow

Cash moving into and out of a business

Cash flow forecast

The projection of likely cash inflows and outflows

Competition

Other businesses that compete for a share in the same market

Competitiveness

The business' ability to offer a better product than its competitors (measured in customers)

Correlation

Relationship between two variables

Total Contribution

The difference between the total sales and total variable costs

Delegation

Where a responsibility or task is passed onto another employee in the business

Demand

Amount of a good or service that customers desire

Democratic

Leadership management when the manager involves the employees to make a decision

Distribution channel

How the business gets its products to the end consumer

Dividend

x

Elasticity of demand

Responsiveness of demand towards the change of price

Extrapolation

Using previous data to predict future data

Favourable variance

When the actual is higher than budgeted results

Fixed costs

Costs that do not vary with the level of output

Gross profit

Revenue - cost of sales

Hierarchy

The structures and levels of management and supervision within a business

Income elasticity of demand

The responsiveness of demand to a change of income

Inventory control

Process that ensures that the business has sufficient but not too much stock

Job design

The way which tasks are combined to form a job

Just-in-time

Method when inventory arrives just when it's needed

Labour productivity

Output produced per employee over a given time

Lean production

Methods of production where a business can reduce waste

Limited liability

Owners are only liable for the money they have invested

Margin of safety

Difference between actual level of output and break even

Market capitalisation

Margin of outstanding shares in a plc

Market growth

The percentage growth of a market over a period of time

Market research

planning, collecting and analysing data to make a market decision

Market segmentation

dividing a market into smaller segments according to e.g. needs so that a business can target specific customers.

Market share

a share of the total market that is owned by a particular business, product or brand

Marketing mix

Use of strategies to help a business reach its objectives, also known as the 7'ps (Place, people, process, product, price, physical and promotion)

Mass customisation

The ability to customise products for individuals on a large scale

Mass market

Targeting a product or service at all customers within a market, e.g. Coca-cola

A niche market

A segment of a larger market that can be targeted

Opportunity costs

The costs of making a decision that is measured by the benefits foregone of the next best alternative

Organisational structure

The way jobs and roles are organised within a business are structured

Penetration pricing

Strategy that lowers the price in order to gain a large market share

Price Elasticity of demand

The response of demand towards a change of the price of a product

Price skimming

Price strategy that involves setting a high price for a new product to take advantage of the customers that are prepared to pay

Primary research

Market research that involves collecting data that does not yet exist

Private limited company

A business owned and controlled by stakeholders whose shares CANNOT be publicly traded

Product life cycle

A common pattern of sales over time into the product's stages from its introduction to withdrawal

Product portfolio

Products and brands owned and operated by a business

Profit for the year

income and expenditure that is taken into account

Profitability

The generation of profit from activities

Public limited company

A business whose shares can be traded publicly on the stock exchange

Qualitative research

Research that concerns the collection of beliefs, intentions, opinions and research

Quality

When a product receives satisfaction from its customers

Quality assurance

the prevention of mistakes in order to get the production of a product right the first time

Quantitive research

Collecting data through statistics that can be research quantified

Sample

A subset of a certain amount

Sole trader

A one-man business with unlimited liability

Span

amount of employees who are under supervision of a manager

Spare capacity

How much a business can produce more with existing resources

Stakeholder

A person with specific interests of a business

Tannenbaum Schmitt continuum

A model that measures the amount of control of a manager compared to the amount of freedom an employee has (Watch your spelling)

Total costs

Total variable and fixed costs

Trade union

An organisation set up by employees to improve the working conditions

Unit costs

Average production costs per unit

Unlimited liability

Debt incurred by a business is not limited to the business. A sole trader risks losing personal assets

Variable costs

Costs directly in proportion to the business' output

Variance

The difference between the budget and the actual (could be favourable or adverse)

Venture capital

Specialists who invest to finance a launch, development, or expansion of a business

Waste

Cost of production section made of completed products or raw materials that could not be retained in production

Working capital

The available amount of money a business has

Works council

Employees and managers who meet up and discuss work related issues

Share capital

The total value of capital raised from shareholders by the issue of shares.

Mission Statement

a formal summary of the values of a company, organisation, or individual.

Vision statement

Vivid, guiding image of an organization's desired future

Corporate Decisions

Medium - long term goals to coordinate a business

Dividends

Profits that are paid to shareholders in proportion to the number of shares they own

Strategy

Long-term plan to achieve the business' vision attaining its corporate objectives

Tactics

Short-term specific actions which advance the strategy and achieve an end result

SWOT analysis

strengths, weaknesses, opportunities, threats

Balance Sheet

Financial statement of assets, liabilities and equity

Capital

Money invested into the business

Debentures

Long term loans other than mortgages

Income Statement

a financial statement showing the revenue and expenses for a fiscal period

Liquidity Ratios

measures of a businesses ability to pay debts in the short term

Gearing ratio

The relationship between internal and external sources of finance

Core competences

Unique abilities a business possesses in order to gain a competitive advantage

Innovation

New ideas to extend the life-cycle of a product or brand

Merger

Two or more firms *agree* to come together into one firm under one board of directors

Takeover

an act of taking control of a company by buying most of its shares

ROCE

Percentage of Net profits compared to the capital employed

differentiation strategy

Offering more benefits than rivals in the same industry

Competitive Advantage

an aspect that provides greater value for customers than competitors can in the market

economies of scale

Lower production costs as a result of larger volume of production

Vertical Integration

When a business joins another at different stages of production

Horizontal Integration

When two business join at the same stage of production