Commerce

Unique Selling Point (USP)

What makes a product special or different. Example: Coke's secret recipe.

Pricing Strategies - Penetration

Low starting price to attract customers. Example: $1 gym trial.

Pricing Strategies - Premium

High price to show high quality. Example: Apple iPhones.

Pricing Strategies - Competitive

Price matches other brands. Example: Supermarkets selling milk for same price.

Pricing Strategies - Psychological

Price looks cheaper than it is. Example: $9.99 instead of $10.

Promotion - Advertising

Promote through TV, social media, posters.

Promotion - Sales Promotion

Short-term deals to boost sales. Example: Buy one get one free.

Promotion - Sponsorship

Pay to display brand. Example: Nike on sports teams.

Promotion - Public Relations

Create good image through events or news.

Distribution - Direct

Producer sells straight to buyer. Example: Farmers market.

Distribution - Indirect

Producer → Retailer → Customer. Example: Nike through Rebel Sport.

Target Market

Specific group of consumers product is aimed at. Example: Parents with babies.

Demand

How much consumers will buy at different prices. Example: Price ↓ → Demand ↑.

Supply

How much producers will sell at different prices. Example: Price ↑ → Supply ↑.

Market Equilibrium

Point where demand = supply. Example: $5 ice cream clears the market.

Demand Curve Movement

Caused by price change; Price ↓ → QD ↑. Label P1, P2, Q1, Q2.

Supply Curve Movement

Caused by price change; Price ↑ → QS ↑. Label P1, P2, Q1, Q2.

Shift in Demand

Caused by non-price factors (income, taste, ads, population). Example: Hot day → more ice cream demand.

Shift in Supply

Caused by non-price factors (costs, weather, tech). Example: Better tech → more supply.

Flow-on Effects

One change affects others. Example: Cheaper petrol → more cars bought.

Accounting Definition

Recording, reporting, and interpreting financial info.

Why We Need Accounting

Track profit/loss and make decisions.

Users of Financial Records

Owners, banks, investors, government.

Budget

Plan income and expenses. Example: $5000 sales, $3000 costs → $2000 surplus.

Income

Money earned. Example: Sales, fees.

Expense

Costs paid. Example: Rent, wages.

Asset

What business owns. Example: Cash, equipment.

Liability

What business owes. Example: Loan, accounts payable.

Income Statement

Shows profit = Income − Expenses. Example: $1000 − $600 = $400 profit.

Cost of Goods Sold (COGS)

Opening stock + Purchases − Closing stock. Example: 200 + 500 − 100 = 600.

Balance Sheet

Shows Assets = Liabilities + Owner's Equity.

Gross Profit %

(Gross Profit ÷ Sales) × 100 → Profit from goods. Example: 50%.

Net Profit %

(Net Profit ÷ Sales) × 100 → Profit after expenses. Example: 20%.

Current Ratio

(Current Assets ÷ Current Liabilities) → Liquidity. Example: 2:1 = good.

Liquid Ratio

(CA − Inventory) ÷ CL → Short-term ability to pay. Example: 1:1 = acceptable.

Trends

↑ = improving performance; ↓ = concern.

Acceptability

Current ratio >1 = safe; Liquid ratio ≈1 = okay.

How to Improve Ratios

Increase sales or cut expenses.

Achieve Question

Say what it is. Example: "Demand means willingness to buy."

Merit Question

Say why it happens. Example: "As price drops, people can afford more."

Excellence Question

Say how it affects people/business. Example: "Higher demand boosts sales and profit, helping business grow."