Business terms ch 1-7 (Business and its Environment AS Level))

Consumer goods

The physical and tangible goods sold to the general public

Capital goods

The physical goods used by industry to aid in the production of other goods and services,

Added value

the difference between the price of a product and the cost of materials used to create it

Entrepreneur

a person who takes on a business venture, bearing all the risks and taking the profits

Triple bottom line

the three objectives of social enterprises: economic, social and environmental.

Social enterprise

a business with mainly social

objectives that reinvests most of its profits into benefiting society rather than maximising returns to owners.

Sole Trader

a business in which one person provides the permanent finance and, in return, has full control of the business

Partnership

a business formed by two or more people to carry on a business together, with shared capital investment and, usually, shared responsibilities.

Shareholder

a person or institution owning shares in a limited company.

Franchise

a business that uses the name, logo, and brand of an existing business

Joint venture

two or more businesses agree to work closely together on a particular project and create a separate business division to do so.

Revenue

total value of sales made by a business in a given time perio

Capital employed

the total value of all long-term finance invested in the business.

Market capitalisation

the total value of a company’s issued share

Internal growth

expansion of a business by means of opening new branches, shops or factories

External growth

business expansion achieved by means of merging with or taking over another business, from either the same or a different industry.

Mission statement

 a statement of the business’s core aims, phrased in a way to motivate employees and to stimulate interest by outside groups.

Corporate social responsibility

this concept applies to businesses that consider the interests of society by taking responsibility for the impact of their decisions and activities on customers, employees, communities and the environment.

Stakeholders

people or groups of people who can be affected by the decisions of a business

Globalisation

the increasing freedom of movement of goods, capital and people around the world.

Privatisation

selling state-owned and controlled business organisations to investors in the private sector.

Takeover

when a company buys more than 50% of the shares of another company and becomes the controlling owner of it 

Merger

an agreement by shareholders and managers of two businesses to bring both firms together under a common board of directors with shareholders in both businesses owning shares in the newly merged business.