Limited liability

The owner and the business is considered as two different entities therefore the owner is not legally responsible for the debt of the business and does not have to pay it of using their own assets

Unlimited Liability

The owner and the business are considered legally as one entity so the owner is legally responsible for the debt of the business and has to pay for it using their own assets

Sole Trader

A type of unincorporated business that is owned by just one

person.

Unincorporated:

a business that is not registered as a

company, so the owners and the business don’t have a separate legal identity

Partnership

When two or more people join together to set up and run an unincorporated business.

Partnership Agreement

Is the written and legal agreement between business partners. It is not essential for partners to have such an agreement but it is always recommended.

Private Limited Company(LTD)

An incorporated business owned by shareholders whose shares can’t be sold to the general public

Public Limited Company(PLC)

Are businesses owned by shareholders but they can sell shares to the public and their shares are tradable on the stock exchange

Annual General Meeting

Is a legal requirement for all companies.Shareholders may attend and vote on who they want to be on the board of directors for the coming year

Dividends

Are payments made to shareholders from the profits (after tax) of a company according to the number of shares they own. They are the return to shareholders for investing in the company

Franchising/franchising

is the expansion of an established business by licensing the right for entrepreneurs to set up their own business using the business name, trademark, equipment and products of the franchisor.

Franchisor

the business that gives franchisees the

right to sell its product under licence , in return for a royalty payment.

Franchisee

a business that agrees to manufacture,

distribute or provide a branded product under licence

from a franchisor.

Royalties:

percentage of the sales revenue to be paid

to the overall franchise owner.

Joint Ventures

Is where two or more businesses start new project together sharing capital risks and profits

Public Corporation

Is a business in the public sector that is owned and controlled by the state(government

Recruitment

Is the process for identifying that the business need to employ someone up to the point at which applications have arrived at the business

Employee selection

Is the process of evaluating candidates for a specific job and selecting an individual for employment based on the needs of the organisation

Job Analysis

The process for determining what the job entails including responsibilities.

Job Description

A summary of what the job entails outlining the skills, experience and duties to be carried out by someone employed ro do a specific job

Job Specification 

Is a document which outlines the requirements qualifications expertise and physical characteristics etc for a specified job

Internal Recruitment

Is when vacancy is filled by someone who is an existing employee of the business

External Recruitment

Is when a vacancy is filled by someone who is not an existing employee and will be new to the business

Part Time

Employment often considered to be between 1 and 30-50 hours a week

Full time

Employees will usually work 35 hours or more a week

Induction Training

Is an introduction given to a new employee explaining the business activities customs and procedures and introducing the to their fellow workers

On the job training

Occurs by watching a more experienced worker doing the job

Off the job training

Involves being trained away from the workplace usually by specialised trainers

Dismissal

Is when employment is ended against the will of the employee usually for not working in accordance with the employment contract

Redundancy

Is when an employee is no longer needed and so loses their job. It is not due to any aspect of their work

Contract of employment

Is a legal agreement between an employer and employee listing the rights and responsibilities if the workers

Industrial Tribunal

Is a type of law court (or in some countries a legal meeting) the makes judgement on disagree e ts between companies and employees for example workers complaints unfair dismissal or discrimination at work

Ethical Decision 

Is a decision taken by a manager or a company because of the moral conde observed by the firm

Marketing

Is identifying the customer wants and satisfying them profitably

customer

Is a person business or other organisation which buy good or services from a business

Customer Loyalty

Is when an existing customers continually buy products from the same business

Customer Relationships

Is communication with customers to encourage them to become loyal to the business and its products

Market Share 

Is the percentage of total market sales held by one brand or business

Consumer

Buys good or service for personal use not to re-sell

Mass Market 

Large market where a business can sell  the same product to the whole market. \

Niche Market

A niche market is specialised subpart of a far larger market 

Market Segment

is a subgroup of a whole market with customers with similar characteristics and buying habits.

target market

is a particular group of consumers that a product or service is aimed at

Market

Is where goods and services are sold

product-orientated.

Business is one whose main focus of activity is on the product itself

market -oriented

Business is one which carries out the market research to fn out consumer wants before a product is developed and produced

Market Research

Is the process of gathering analysing and interpreting information about  market

Primary Research

(field research) involves the collection of first hand data that did not exist before. Therefore it is original data.

Secondary Research

(desk research) is research that has already been undertaken by another organisation and therefore already exists.

Quantitative research

is concerned with collecting data that is numerical

and can be counted

Qualitative research

is used to gain an understanding of what people think, their underlying reasons, opinions, and motivations

Marketing budget

Is a financial plan for the marketing of a product or product range for some specified period of time.

Questionnaire

Is a method of collecting data about consumers by observing their behaviour in a natural or controlled setting. This type of research is used to gain insights into how consumers interact with products, packaging, and advertising in real-world situations

Focus Groups

A focus group is used to collect opinions and feedback from a group of people about a specific product or service . 

Interviews

An interview is a qualitative research method used to collect primary data.It involves having a face-to-face conversation with 1 or more people and asking them about their opinions on a product/service.

Observation

Observation is to watch the customers and find out their reactions to products and services.

Online Survey

An online survey is a cheap and useful structured questionnaire that your target audience completes for you to get a limited amount of feedback 

Sample

Is the group of people who are selected to respond to a market research exercise.

Random Sample

i s when people are selected at random as a source of information for market research

Quota sample

Is when people are selected on the basis of certain characteristics (such as age gender or income) as a source of information for market research

Marketing Mix

Is a term which is used to describe all activities which go into marketing a product or service. These activities often summarised as 4ps(product, price place and promotion)

Consumer goods

Tangible products bought by users for their purpose

Consumer Services

Intangible products bought by user for their purpose

Producer Goods 

Tangible products that are produced for other businesses to use.

Producer Services

Intangible products that are produced for other businesses to use.

USP(Unique Selling Point)

Is the special feature of a product that differentiates it from the products of competitors.

Brand Name

Is the unique name of a product that distinguishes it from other brands

Brand Loyalty

Is when consumers keep buying the same brand again and gain instead of choosing a competitors’ brand

Brand Image

Is an image or identity give to a product which gives it a personality of its own and distinguishes it from its competitors brands

Packaging

Is the physical container or wrapping for a product. It is also used for promotion and selling appeal.

Product Life Cycle

Describes the stages the product will pass through from its introduction through its growth until it is mature and then finally its decline

Extension Strategy

Is a way of keeping a product at the maturity stage of the life cycle and extending the cycle

Cost-Plus Pricing

Is the cost of manufacturing the product plus a profit mark-up

Competitive pricing 

Is when the product i priced in line with or just below competitors’ price to try to capture more of the market

Penetration Pricing

Is when the price is set lower than the competitors’ prices in order to be able to enter a new market

Price Skimming 

Is where a high price is set for a new product on the market

Promotional Pricing

Is when a product is sold at a very low price for a short period of time

Dynamic Pricing

Is when businesses change product prices usually when selling online depending on the level of demand

Price elastic demand

Is where consumers are very sensitive to change in price

Price inelastic demand

Is where consumers are not sensitive to changes in price

Distribution Channel

Is the means by which a product is passed from the place of production to the customer

Agent

Is an independent person or business that is appointed to deal with the sales and distribution of  product or range of products

Promotion

Is where marketing activities aim to raise customer awareness of a product or brand generating sales and helping to create brand loyalty

Advertising

Paid for communication with potential customers about a product to encourage them to buy it

Informative Advertising

Is where the emphasis of advertising  or sales  promotion is to give full information about the product

Persuasive advertising

Is advertising or promotion which is trying to persuade the consumer that they really need the product and should buy it

Target audience

Refers to people who are potential buyers of a product or service

Sales Promotion

Are incentives such as special offers or special deals aimed at consumers to chive short-term increase in sales

Loyalty Cards

It is a form of personal selling, giving customers access to

promotions and discounts the more they use the card

Sponsorship

In return for having their name promoted, a company

will pay towards supporting an event, person or team

After Sales Service

Customers reassured that if the product goes wrong they can go back and have it repaired

Gifts

Small gifts are placed in or outside the packaging to encourage purchases.

BOGOF

Is where multiple purchases are encouraged

Price Reduction

Reduced price during specific times of the year

Competition

Information to enter a competition, either on the packaging on the product or more commonly on social media.

Point of display

Special displays which stand out and give a key position to the product

Free Samples

A free sample is given to customers to try the product.  Often food to taste or toiletries. Encourage the customer to try the product and hopefully buy it.

Product Placement

Where branded goods are featured in TV programmes, movies or music videos.  Products are associated with the image in the movie or programme

Productivity

Is the output measured against the inputs used to create it

The buffer Inventory

Level is the inventory held with uncertainty in customer demand and deliveries of supplies

Reorder level

Is the level of stock at which new stock will be ordered by the business

Lean Production

Is a term for those techniques used by businesses to cut down on waste therefore increase efficiency.

Kaizen

Is a japanese term meaning “continuous improvement” through the elimination of waste

Just In Time(JIT(

Is a production method that involves reducing or virtually eliminating the need to hold stock of raw materials or unsold stock of the finished product

Jobe Production

where items are made individually and each item is finished before the next one is started

Batch Production

Products are made in groups of items of a certain quantity and  then a quantity of another is produced

Flow Production

Is where large quantities of a product are produced in a continuous process. 

Fixed Cost (FC)

Are expenses that do not  change as output changes

Variable Costs(VC)

are expenses that change as output changes

Total Costs (TC)

are the full costs of running a business

Average cost per unit

Is the total cost of production divided by the total output 

Economies Of Scale

Are the factors at lead to a reduction in average costs as a business increases in size

Diseconomies Of Scale

Are the factors that lead to an increase in average costs as a business grows beyond a certain size

Break-Even Level Of Output

Is the quantity that must be produced/ sold  for the total revenue to equal total costs

Break Even Charts

Are graphs which show how costs and revenues of a business change with sales.They show the leve of sales the business must make in order to break even

Revenue

Of a business is the income during a period of time from sale of good ot services (TR=quantity sold*Price)

Margin Of Safety

Is the amount by which sales exceed the breakeven point

Contribution

Of a product is ts seeking price less its variable cost