Business Studies Review - Nature, Management, and Planning

Comprehensive vocabulary flashcards covering the key concepts from the Business Studies lecture notes, including business types, management approaches, financial calculations, and the planning process.

Business

The organised effort to produce and sell for a profit products that satisfy individual needs and wants.

Profit

The amount of money that remains after expenses are deducted from revenue.

Quality of Life

The overall well being of an individual, which is a combination of material and non-material benefits.

Micro business

A business that employs fewer than $5$ people.

Small business

A business that employs between $5$ and $19$ people.

Medium business

A business that employs between $20$ and $199$ people.

Large business

A business that employs more than $200$ people.

SME (Small to Medium Enterprise)

Businesses with less than $200$ employees that make up $97\%$ of Australian businesses as of 2021.

Primary Industry

Production involving natural resources, such as farming or mining.

Secondary Industry

The production of finished or semi-finished goods through manufacturing.

Tertiary Industry

The performance of a service, such as retail, hospitality, or healthcare.

Quaternary Industry

Services involving the transfer and processing of information and knowledge, like education and research.

Quinary Industry

Services traditionally performed at home, such as cleaning, cooking, and childcare.

Unlimited liability

A legal condition common in sole traders and partnerships where the owner is personally responsible for all business debts.

Private company (Pty Ltd)

An incorporated business with 2-50 shareholders that is not listed on the stock exchange.

Public company (Ltd)

An incorporated business listed on the stock exchange where the public can buy shares via a prospectus.

Privatisation

The process of transferring ownership of a government-run business to the private sector.

Monopoly

A market structure where one single business dominates the industry.

Oligopoly

A market structure where a few large firms dominate the industry.

Cash Flow

The movement of money in and out of a business.

Business culture

The values, expectations, and beliefs within a workplace.

Stakeholders

Any group or individual who has an interest in or is affected by the activities of a business.

Maturity Stage

The phase in the business life cycle where the rate of growth slows and eventually plateaus.

Undercapitalization

A condition where there is a lack of sufficient funds to operate a business normally, leading to failure.

Liquidation

The process of winding up an incorporated company and selling assets to repay creditors.

Voluntary administration

When a business in financial trouble appoints a specialist to determine if it can be saved and continue running.

Strategic Thinking

The skill of planning long-term goals and organising, tracking, and improving progress.

Classical Management Approach

An approach that stresses the best way to manage and organise workers to improve productivity, often using a hierarchy and autocratic leadership.

Behavioural Management Approach

An approach that stresses that employees are the main focus and that their economic and social needs must be satisfied.

Contingency Management Approach

A management style that emphasizes flexibility and adjusting methods to suit specific internal or external circumstances.

Transformed resources

Inputs that are changed in the production process, such as raw materials, information, and customers.

Transforming resources

Inputs that perform the change in the production process, such as employees and machinery.

Total Quality Management (TQM)

A whole-business commitment to excellence and continuous improvement in quality.

Target Market

A specific group of potential customers that a business aim to sell its products or services to.

Skimming Price

Setting a high price for a product at its launch.

Penetration Price

Setting a low price initially to attract customers and gain market share.

Equity Finance

Business funding sourced from retained profits, sale of assets, or funds from shareholders.

Income Statement

A financial summary showing the revenue earned, expenses incurred, and the resulting profit or loss over a trading period.

COGS (Cost of Goods Sold)

The value of stock sold, calculated using opening stock and closing stock.

Net Profit Formula

$$Net\,Profit = Gross\,Profit - Expenses$$

Balance Sheet equation

$$Assets = Liabilities + Owner's\,Equity$$

Intangible Assets

Non-physical items of value owned by a business, such as trademarks and copyrights.

Job Analysis

The process of identifying staffing needs, consisting of a Job Description (tasks) and Job Specification (skills).

Triple Bottom Line

A reporting framework that encompasses economic, environmental, and social performance.

SWOT Analysis

A situational analysis tool used to identify Strengths, Weaknesses, Opportunities, and Threats.

Total Revenue Formula

$$Total\,Revenue = Price \times Quantity\,Sold$$

Break-Even Analysis Formula

$$Break\text{-}Even = \frac{Fixed\,Costs}{Sales\,Price\,per\,Unit - Variable\,Cost\,per\,Unit}$$

Economies of Scale

The cost advantage a business gains through an increase in the scale of production, resulting in lower costs per unit.

ASIC

The organisation responsible for managing the registration of business names.

Zoning

Legal restrictions managed by local councils that determine where specific types of businesses can operate.