other version of business 1 key terms

vision statement

sets out what the business wants to be in the future.

Unlimited liability

occurs when an individual or group of individuals is personally responsible for all the actions of their business. With sole traders, there is no distinction in law between the individuals and the business, and so they could lose their personal assets if the business has financial problems.

Tactics

are the short-term actions needed to implement a strategy.

SWOT analysis

considers the internal and external environments of a business.

STEEPLE analysis

examines factors in the external macro environment of a business that are largely beyond its control

Stakeholders

are groups or individuals who have an interest in a business.

Shareholders

are persons or organizations that own a part of a company.

Profitability

is a measure of a business’s performance in which profits are compared to another piece of data, such as sales revenue or the value of assets used by the business.

objective

a target that is measurable and has a given timescale.

mission statement

sets out the overall purpose of a business.

Limited liability

means that investors can lose the money they have invested into the business, but their personal possessions are safe. There is a limit to their risk.

Ethics

are moral principles that can shape the way a business behaves.

Ethical objectives

objectives that are based on moral principles.

Corporate social responsibility (CSR)

is a philosophy under which businesses consider the interests of all groups in society as a central part of their decision-making.

cooperative

is a business that is owned and run by and for its members, who have one vote each.

company

is a business organization which has its own legal identity and which has limited liability.

business plan

is a written document that sets out key aspects of a business idea and how it will be developed.

Adding value

occurs in a transformation process when outputs are produced that are worth more than the inputs brought in to provide them.

Goods

the physical and tangible goods sold to final users; these include cars, food and clothing