Business Terminology (need to see if they correct)

Intangible

Unlike goods, services are not physical in their nature.

Inseparable

The service received is attached to the people who deliver the service and the processes used to deliver the service.

Perishable

Services do not last but are usually consumed at the time of purchase.

Variable

Services are heterogeneous; each customer experience is unique.

Needs

Basic Necessities.

Wants

People’s desires.

Business

An organization that produces goods and services.

Goods

Physical products, e.g., clothes, food.

Consumer Goods

Products sold to the general public, rather than to other businesses.

Consumer Durables

Products that last a long time and can be used repeatedly.

(Consumer) Non-Durables

Products that need to be consumed shortly after purchase.

Capital Goods (or Producer Goods)

Physical products bought by businesses to produce other goods and/or services.

Services

Intangible products, e.g., banking, healthcare.

Entrepreneur

The individual who plans, organizes, and manages a business and its operations, taking on financial risks.

Customers

The people or organizations that purchase a product.

Consumers

The ones who actually use the product.

Adding value

Cost of producing good or service > cost of resources used to produce it.

Profits

Earnings - Costs; if positive, then profits; if negative, then loss.

Land

Natural resources used for goods and services, e.g., water, sand, plants.

Labour

The human effort used for goods and services, also referred to as human resources.

Capital

Non-natural resources used for goods and services, e.g., machinery, motor vehicles.

Entrepreneurship

Individuals who have the skills, knowledge, and ability to produce goods and services to earn profit.

Human resources

Workforce functions that are related to staff, e.g., employment/recruitment, training.

Finance and accounts

Confirming that there are sufficient funds to run the business, and managing the organization’s money.

Marketing

Researching the needs and wants of customers in a profitable way, e.g., promoting, distributing products efficiently.

Operations management

Includes all the operations that relate to the production of goods and services to meet customer needs.

Primary sector

Natural resources, e.g., mining, farming, fishing (extractive production).

Secondary sector

Manufacturing or construction of finished goods, e.g., bread, cake, cheese.

Tertiary sector

Services to customers, e.g., grocery store, bakery, banks.

Quaternary sector

Creation and distribution of knowledge, e.g., information technology, biotechnology.

Visionary

An entrepreneur who has the foresight and driving force behind an organization’s growth and development.

Private sector

The economy consisting of businesses owned and run by private individuals and organizations aiming to earn profit.

Public sector

Organizations controlled by a regional and/or national government to provide essential goods and services.

Companies

Commercial for-profit businesses owned by shareholders.

Deed of Partnership

A formal partnership agreement between the owners, including responsibilities, voting rights, and profit sharing.

Initial Public Offering (IPO)

When a company sells its shares on a public stock exchange for the first time.

Ordinary partnership

Has a minimum of 2 partners and up to 20 owners.

Partners

Co-owners of a partnership business.

Partnership

A commercial business that strives to earn a profit for its owners.

Privately held companies

Limited liability companies owned by shareholders whose shares cannot be traded publicly.

Publicly held companies (or joint-stock companies)

Limited liability companies with shares that can be traded on a public stock exchange.

Shareholders

Owners of a limited liability company.

Silent partners

Inactive owners of a partnership business who provide capital without involvement.

Sole trader

The single owner of a business organization who makes all decisions and assumes all risks.

Stock exchange

A marketplace where shares in publicly held companies can be bought and sold.

Unlimited liability

Personal responsibility for all debts of a sole proprietorship without limits.

For-profit social enterprises

Revenue-generating businesses with social objectives at their core.

Microfinance

Financial services offered to those without jobs or on very low incomes.

Public Sector Companies

Government-owned enterprises that operate commercially.

Public Private Partnerships

Jointly established enterprises by government and private sector businesses.

Cooperatives

For-profit enterprises owned and run by their members to create value for them.

Non-governmental organization (NGO)

A non-profit social enterprise in the private sector promoting a social cause.

Non-profit social enterprises

Operate commercially but do not distribute profits to owners.

Non-profit organization (NPO)

A legal entity for collective or social benefit rather than primarily generating profit.

Social enterprises

Business entities that generate revenue with community objectives.

Surplus

The financial gain of a non-profit social enterprise, reinvested back into the organization.