BA 101 Midterm 1 University of Oregon

Goods

Tangible products

Services

Intangible products

Loss

Occurs when a business's expenses are more than its revenue

Standard of living

Amount of goods and services people can buy with the money they have

Quality of life

General well-being of a society in terms of its political freedom, natural environment, education, health care, safety, amount of leisure and rewards that add to satisfaction and joy that other goods and services provide

Stakeholders

People who stand to gain or lose by the polices and activities of a business and whose concerns the business needs to address. Ex: Customers, employees, stockholders, suppliers, dealers, eat.

Outsourcing

Contracting with other companies to do some or all of the functions of a firm, like its production or accounting tasks. May be used in order to stay competitive.

The Five Factors of Production

1. Land and natural resources

2. Workers

3. Capital-includes machines, tools and what is used in the production of goods

4.Entrepreneurship

5.Knowledge- most important factor

Empowerment

Giving the frontline people responsibility, equipment and freedom they need to respond to customers

Demography

statistical study of the human population

World trade or globalization

Grown thanks to the development of efficient distribution systems and the internet

War and Terrorism

Business people and citizens benefit from a peaceful and prosperous world

Economics

Study of how society choses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals. As referred to as the study of the allocation of scarce resources.

Resource development

Study of how to increase resources and create conditions that will make better use of them

Adam Smith

-Believed freedom was vital to the survival of any economy

-Believed people will work long and hard if they have incentives

-Envisioned creating more resources so that everyone could become wealthier

-People work for their own prosperity and growth

-Invisible hand

Invisible hand

Used to describe the process that turns self-directed gain into social and economic benefits for all

Capitalism or free market economies

All or most of the factors of production and distribution are owned by individuals. Not country is purely capitalist.

State capitalism

Combination of freer markets and some government control

Price

Tells producers how much to produce

Supply

Refers to the quantities of products manufacturers or owners are willing to sell at different prices at a specific time

Demand

Refers to the quantity of products that people are willing to buy different prices at a specific time

Market price

Determined by supply and demand. The price toward which the market will trend.

Equilibrium point or equilibrium price

Supply and demand are equal

Perfect competition

Many sellers are in a market and none is large enough to dictate the price of a product

Monopolistic competition

A large number of sellers produce very similar products that buyers perceive as different. Production differentiation is key to success.

Oligopoly

Few sellers dominate a market

Monopoly

One seller controls the total supply of a product or service

Command economies

Exists when the government decides what goods and services will be produced, who gets them and how the economy will grow. Socialism and communism are variations on this economic system.

Mixed economies

Exist where some allocation of resources is made by the market and some by the government

Gross domestic production

total value of final goods and services produced in a country in a given year

Unemployment rate

Refers to the percentage of civilians at least 16 years old who are unemployed and tried to find a job within the prior four weeks

Types of unemployment

Frictional: Moving from one job to another

Structural: Skills needed change

Cyclical: The ups and downs in growth and production

Seasonal: Demand for labor is lower

Inflation

General rise in the prices of goods and services over time

Disinflation

Occurs when price increase are slowing

Deflation

Prices are declining

Stagflation

Occurs when the economy is slowing but prices are still going up

Consumer price index

Measure the place of inflation or deflation

Core inflation

Consumer price index minus food and energy cost because they can have temporary price shocks and the inflation measures reported are actually lower than real costs

Producer price index

Measures the change in prices at the wholesale level

Business cycles

Periodic rises and falls that occur in economies over time

1. Recession- Two or more quarters of decline in GDP

2. Depression- Severe recession

Fiscal policy

Governments effort to keep the economy stable by increasing/decreaing taxes or government spending

Keynesian economic theory

The theory emphasizing that government spending and deficits can help the economy weather its normal ups and downs. Proponents of this theory advocate using the power of government to stimulate the economy when it is lagging.

Monetary policy

Management of the money supply and interest rates of the Federal Reserve Bank

Marketing

The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large

-Used to focus on helping the seller sell but now focuses on helping the buyer

Eras of Marketing

1. Production: Produce as much as you can because there is a limitless market for it

2. Selling: Emphasized selling and advertising

3. Marketing concept: Businesses recognized that they needed to be responsive to consumers

-The marketing concept three parts:

1. Customer orientation- find out what customers want and provide it

2. Service orientation- make sure everyone has the same objective to satisfy the customer

3. Profit orientation- Focus on those goods and services that will earn the most profit and enable the organization to survive and expand to serve more consumer wants and needs

-Took a while to implement

4. Customer relationship (CRM): process of learning as much as possible about present customers and doing everything to satisfy them or exceed expectations. Enhance satisfaction and stimulate long-term customer loyalty

5. New Era: Mobile/on-demand marketing: Consumers demand relevant information exactly when they want it

The Marketing Mix

Product

-Physical good, service or idea that satisfies a want or need, plus anything that would enhance the product, such as brand name

Price

Place

Promotion

-Technigues sellers use to inform people about and motivate them to buy their products or services

-Building relationships with customers

Middlemen or intermediaries

Middle links in a series or organizations that distribute goods from producers to consumers

Marketing research

Analyze markets to determine opportunities and challenges and find information they need to make good decisions

Marketing research process

Defining the question and determining the present situation

Collecting research data

Analyzing research data

Choosing the best solution and implementing it

Focus group

Group of people who meet uber the direction of a discussion leader to communicate their opinions about an organization

Environmental scanning

Process of identifying factors that can affect marketing success

Business-to-business market (B2B)

Individuals and organizations that want goods and services to use in producing other goods and services or to sell, rent or supply goods to others

Consumer market

Individuals or households that want goods and services for personal consumption or use and have the resources to buy them

Geographic segmentation

Dividing a market by cities, counties, states or regions

Niche marketing

Small but profitable market segments

One to one marketing

Means developing a unique mix of goods and services for each individual customer

Channel of distribution

any series of firms or individuals who participate in the flow of products from producer to final user or consumer

Agents/brokers

Bring buyers and sellers together and assist in negotiating an exchange but never own the goods. Usually do not carry inventory, provide credit or assume risks

Time utility

intermediaries add to their products by making them available when consumers need them

Service utility

providing fast, friendly service during and after the sale and by teaching customers how to best use products over time

Merchant wholesalers

Independently owned firms that take title to the goods they handle. 80% of wholesalers fall under this category. Two types: full-service and limiter function

Rake robbers

furnish racks or shelves full of merchandise. Display products and sell them on signalment (keep title to the goods until they're sold and then share the profits with the retailer.

Cash-and-carry wholesalers

serve mostly smaller retailers with limited assortment of products. Traditionally retailers went to wholesalers and paid cash for the product and then sold it in their store.

Drop shippers

Solicit orders from retailers and other wholesalers and have the merchandise shipped directly from a producer to a buyer

Intensive distribution

puts products into as many retail outlets as possible, including vending machines. Ex: Candy, gum and magazines.

Selective distribution

Uses only a preferred group of the available retailers in an area. Helps ensure producers of quality sales and service. Ex: furniture, clothing

Exclusive distribution

Use of only one retail outlet in a given geographic area

Direct selling

Reaches consumers in their homes or workplace. Ex: Rondan and fields

Direct marketing

Directly links manufacturers or intermediaries with the ultimate consumer. Direct mail, catalog sales, telemarketing and online marketing

Corporate distribution system

One firm owns all the organizations in the channel of distribution

Contractual distribution system

If a manufacturer can't buy retail stores in can try to get retailers to sign a contract to cooperate with it.

Administered distribution system

a distribution system in which producers manage all of the marketing functions at the retail level

Supply chain (value chain)

All the linked activities various organizations must perform to move goods and services from the sources of raw materials to ultimate consumers

Supply-chain management

Managing the movement of raw materials, parts, work in progress, finished goods and related information through a supply chain. Managing the return and recycling also.

Logistics

describe how companies perform the 7 Rs: Getting the right product to the right place to the right customer at the right time in the right quantity in the right condition and the right price

Inbound logistics

Brings raw materials, packing, other goods and service and information from suppliers to producers

Materials handling

Movement of goods within a warehouse, from warehouses to the factory floor and from the factory floor to various workstations

Outbound logistics

Manages the flow of finished products and information to business buyers and ultimately to consumers

Reverse logistics

Brings goods back to the manufacturer because of defects or for recycling materials

Freight forwarder

Puts many small shipments together to create a single large one that can be transported cost-effectively by truck or train

The storage function

Buyers want goods quickly meaning marketers must have goods available in various parts of the country ready to be shipped locally when ordered

Value

A function of scarcity and needs

Distributed product development

Handing off various parts of your innovation process

Total product offer

Consists of everything consumers evaluate when deciding whether to buy something

A product line

is a group of products that are physically similar or intended for a similar market

Product differentiation

the creation of real or perceived product differences.

Convenience goods and services

Products that the consumer wants to purchase frequently and with a minimum of effort.

Shopping goods and services

those products that the consumer buys only after comparing value, quality, price, and style from a variety of sellers

Unsought goods and services

products that consumers are unaware of, haven't necessarily thought of buying, or find that they need to solve an unexpected problem

Industrial goods

Products used in the production of other products. Sometimes called business goods or B2B goods.

bundling

grouping two or more products together and pricing them as a unit

Manufacturers' brands

Manufacturers that distribute products nationally

Dealer (private-label) brands

Products that don't carry the manufacturer's name but carry a distributor or retailer's name instead.

Generic goods

nonbranded products that usually sell at a sizable discount compared to national or private-label brands

Brand awareness

how quickly or easily a given brand name comes to mind when a product category is mentioned

Brand loyalty

consistent preference for one brand over all others

Brand association

the linking of a brand to other favorable images

Product screening

a process designed to reduce the number of new-product ideas being worked on at any one time

Product analysis

making cost estimates and sales forecasts to get a feeling for profitability of new-product ideas

Concept testing

testing new product concepts with a group of target consumers to find out if the concepts have strong consumer appeal