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Franchisor

The headquarters/supplier who owns the brand and sells the method of operation to franchisees.

Franchisee

The person or business that buys the rights to operate a franchise.

Double taxation

Corporate earnings and shareholder dividends are both taxed.

S Corporation

A business structure that avoids double taxation but keeps limited liability.

Sole proprietorship

The business type with the least government regulation.

Unlimited liability

A situation where owners are personally responsible for debts and damages.

Limited liability

Owners’ responsibility is limited to their investment in the business.

Cooperative

An organization owned collectively to gain economic power (e.g., farmers, small businesses).

Merger

Two companies combine to form one new company.

Acquisition

One company purchases another.

Joint venture

A temporary business arrangement for one project, dissolved after completion.

Entrepreneur

A person who takes the risk of starting and managing a business.

Intrapreneur

Someone innovating within a corporation, not starting their own business.

Micropreneur

An entrepreneur who wants to stay small.

Multipreneur

An entrepreneur who starts multiple businesses.

Business plan

A formal written statement describing a business idea, market, competition, and finances.

Debt financing

Borrowed money that must be repaid with interest.

Equity financing

Selling ownership (stock) to raise money.

Venture capital

Financing from firms investing in high-growth startups, taking ownership and management role.

Angel investors

Wealthy individuals funding startups in exchange for equity.

Outsourcing

Hiring another company to handle specific tasks.

Small Business Administration (SBA)

Federal agency that provides loans and support to small businesses.

Planning

The process of determining goals and deciding how to achieve them.

Organizing

Establishing a company’s structure, assigning tasks, and allocating resources.

Leading

Guiding and motivating employees to achieve objectives.

Controlling

Setting performance standards, measuring results, and correcting deviations.

Middle management

Management level that translates broad strategies into specific plans for divisions or plants.

Supervisory management

Management level involving direct oversight of employees engaged in production.

Strategic planning

Long-range, big-picture planning.

Operational planning

Short-term, daily/weekly planning by supervisors.

Contingency plan

Backup plan for unexpected events.

Technical skills

Specialized knowledge such as programming or accounting.

Conceptual skills

Ability to see the big picture and plan.

Empowerment

Giving employees more autonomy and decision-making power.

Mission statement

The general purpose or reason for an organization’s existence.

Participative leadership

A leadership style where decisions are made after consulting subordinates.

Leadership style

The consistent pattern of behavior used by a leader.

Franchisor

The company that grants the rights to use its name and business model in exchange for fees.

Franchisee

An individual who purchases the right to operate a business under another company’s name.

Sole Proprietorship (liability)

The ownership structure most vulnerable to personal financial loss if the business fails due to unlimited liability.

Sole Proprietorship (regulation and capital)

The form of ownership that offers the greatest freedom from government regulation, but the least ability to raise capital.

General Partnership

A partnership where all partners both manage the company and are equally responsible for all debts.

Limited Partner (in a limited partnership)

A partner who invests money but does not participate in daily management, with liability limited to their investment.

Vertical Merger

A firm that combines with its supplier in order to control more of the supply chain.

Merger

When two companies combine to form one new entity.

Acquisition

When one corporation fully purchases another, but both may retain separate operations until integration.

Joint Venture

A temporary business arrangement where two companies work together to accomplish a single, limited project.

Cooperative

An organization collectively owned by members to increase buying power and reduce costs.

S Corporation

A type of corporation that provides limited liability to its owners while avoiding double taxation.

Entrepreneur

A person who assumes financial risk to create and operate a business.

Intrapreneur

An employee who applies entrepreneurial thinking and innovation inside a large organization.

Micropreneur

An entrepreneur who deliberately keeps their business small rather than pursuing extensive growth.

Multipreneur

An entrepreneur who launches several ventures, sometimes simultaneously.

Business Plan

A formal written document outlining a new company’s goals, competitive analysis, financial forecasts, and strategy for success, often required for bank loans.

Debt Financing

Borrowed money that must be repaid with interest.

Equity Financing

Raising money by selling ownership shares in the company.

Venture Capitalists

Investors who demand partial ownership and management influence in exchange for funding high-growth startups.

Angel Investors

Wealthy individuals who personally invest in early-stage businesses in exchange for equity.

Outsourcing

Hiring an outside company to perform services that could otherwise be done in-house.

Small Business Administration (SBA)

A U.S. government agency that provides financial assistance and consulting services to small businesses.

Planning

The process of determining goals and deciding how to achieve them as a management function.

Organizing

The management function that establishes a company’s structure, assigns tasks, and allocates resources.

Leading

The management function of guiding and motivating employees to achieve objectives.

Controlling

The management function that involves setting performance standards, measuring results, and correcting deviations.

Middle Management

The level of management that translates broad strategies into specific plans for divisions or plants.

Supervisory (First-Line) Management

The management level composed of supervisors who oversee employees directly engaged in production.

Strategic Planning

Long-term planning that involves developing overall goals for the organization as a whole.

Operational Planning

Short-term planning that covers current operations, often done by supervisors.

Contingency Plan

A backup strategy created in case original plans fail or unforeseen events occur.

Technical Skill

A type of managerial skill involving specialized expertise such as accounting or computer programming.

Conceptual Skill

The managerial ability to see the “big picture” and understand how different parts of the business fit together.

Empowerment

Granting employees greater decision-making authority and control over resources.

Mission

An organization’s formal statement of purpose and reason for existence.

Participative Leadership Style (Democratic/Consultative/Consensual)

Leaders who make decisions after consulting subordinates and value their input.

Leadership Style

The consistent way a leader approaches motivating and directing employees.