What is Business?

What is a business?

An organisation that produces goods or services to meet customer needs.

What is entrepreneurship?

The process of setting up and running a new business, taking financial risks in the hope of profit.

What is a business idea?

A concept for a product or service that meets a customer need.

What is a market?

A place or system where buyers and sellers interact.

What is added value?

The difference between the selling price of a product and the cost of inputs.

What is opportunity cost?

The value of the next best alternative foregone when making a decision.

What is a customer need?

A requirement that a product or service satisfies.

What is market research?

The process of gathering information about customers, competitors, and the market.

What is primary research?

Data collected first-hand for a specific purpose.

What is secondary research?

Data that already exists and is used for a new purpose.

What is qualitative data?

Non-numerical data based on opinions, attitudes, and motivations.

What is quantitative data?

Numerical data that can be measured and analysed statistically.

What is market segmentation?

Dividing a market into groups with similar characteristics.

What is niche market?

A small, specialised segment of a larger market.

What is mass market?

A large market with many customers and broad demand.

What is a USP?

Unique Selling Proposition - what makes a product different from competitors.

What is a sole trader?

A business owned and controlled by one person.

What is a partnership?

A business owned by 2–20 people who share responsibility.

What is a private limited company (Ltd)?

A business owned by shareholders but not publicly traded.

What is limited liability?

Owners are only responsible for business debts up to their investment.

What is unlimited liability?

Owners are personally responsible for all business debts.

What is a franchise?

A business model where a franchisee uses an established brand name.

What is an objective?

A goal a business aims to achieve.

What is profit?

Total revenue minus total costs.

What is revenue?

The total income from sales.

What is break-even?

The point where total revenue equals total costs.

What is cash flow?

The movement of money in and out of a business.

What is a cash flow problem?

When a business does not have enough cash to pay its expenses.

What is a business plan?

A document outlining business goals and how they will be achieved.

What is risk in business?

The possibility of losing money or failing to achieve objectives.

What is reward in business?

The potential profit or benefit gained from taking risks.

What is fixed cost?

Costs that do not change with output.

What is variable cost?

Costs that change with output.

What is total cost?

Fixed costs plus variable costs.

What is break-even formula?

Fixed costs ÷ (price - variable cost per unit).

What is margin of safety?

The difference between actual output and break-even output.