1.4 - Making the Business Effective

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32 Terms

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Unlimited Liability
A business owner is personally liable for all debts of the business.
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Limited Liability
Shareholders are only responsible for a company's debts up to the amount they invested.
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Sole Trader
A business owned and operated by a single individual who receives all profits and bears all risks.
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Partnership
A business owned by two or more individuals who share profits and responsibilities.
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Private Limited Company (Ltd)
A company whose shares are owned privately and not available to the general public.
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Franchise
A business model where a franchisor licenses a franchisee to operate a business using the franchisor's brand.
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Marketing Mix
The combination of product, price, place, and promotion strategies used to market a product.
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Business Plan
A formal written document describing the business, its objectives, strategies, and financial forecasts.
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Market Research
The process of gathering, analyzing, and interpreting information about a market.
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Dividends
Payments made to shareholders from a company's profits.
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Board of Directors
A group of individuals elected to represent shareholders and manage a company.
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Revenue
The total income generated from sales of goods or services before any expenses are deducted.
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Cash-flow Forecast
An estimate of the cash inflows and outflows over a specific period.
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Legal Structure
The type of ownership organization a business chooses (e.g., sole trader, partnership, Ltd).
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Competitor Analysis
Examining competitors' strengths and weaknesses to inform business strategy.
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Target Market
A specific group of consumers at which a company aims its products or services.
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Business Objectives
Specific goals a business aims to achieve within a set timeframe.
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Operational Plan
Details how a business will deliver its products or services.
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Investment Protection
Measures taken to safeguard investors' capital in a business.
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Business Location
The geographical area where a business operates and the factors influencing this choice.
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Entrepreneur
An individual who starts and runs a new business, often taking on financial risks.
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Cash-flow
The movement of money into and out of a business.
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Financial Viability
The ability of a business to generate sufficient revenue to cover its expenses.
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Service Sector
The part of the economy that provides services rather than goods.
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Market Segment
A specific group of potential customers sharing similar characteristics.
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Supply Chain
A network between a company and its suppliers to produce and distribute a specific product.
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Equity Financing
Raising capital through the sale of shares in the business.
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Debt Financing
Raising capital through loans that must be repaid over time.
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Brand Awareness
The extent to which consumers recognize and remember a brand.
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Consumer Behavior
The study of how individuals make decisions to spend their resources.
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Price Point
The price at which a product is offered in the market.
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Promotional Strategies
Methods used to promote products and services to potential customers.