ENTREPRENEURSHIP terms

ENTREPRENEURSHIP

1. Entrepreneur:

 A person who sells or produces products in order to make profit

 A person who starts and manages his/her own business

 A person who notices a gap/ recognises business opportunities within the market

and transforms it into a successful and profitable business venture

2. Business plan:

 A formal statement of what a business wants to accomplish and how it intends to

accomplish it

3. Target market:

 Is a specific group of people who would be interested on your products/services

and purchase them

 People who share the same characteristics e.g. gender, age, occupation, buying

habits, income group and culture

4. Market research:

 Is a planned and organised effort to get new knowledge/facts that will help the

entrepreneur to make informed decisions about his/her product and marketing

thereof

 Is conducted to find out about the potential market and to identify what the

market needs and wants are

5. Start –up capital:

 Are costs/money needed to set up/start a business and to run it until it reaches the

profit threshold

6. Start-up resources:

 Material and human resources needed to start up a business

7. Profit threshold: (break-even point)

 The point where total costs (expenses) and total sales (revenue) are equal. There is

no net profit or loss

 When the income equals the expenditure and the business shows no profit or loss

 Is the minimum number of sales necessary to cover all expenses

8. Operating costs:

 are costs paid out to run the business and to produce the product

 costs of all extra expenditure to run the business

9. Product specification:

 Are the standards that must be maintained in making a product

 Detailed statement describing the product

 Ensures that consumers will always get a good quality product regarding

appearance, texture, taste, size

10. Quality control:

 Is the process of inspecting products to ensure that the required standards are met

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 Is the procedure for making sure that the quality of a product is maintained through

inspection to meet the required standards

11. Sustainable production:

 Using goods and services to improve the quality of life and meet basic needs of

consumers without harming the environment

12. Profitable business:

 A business that fulfils an unmet need in the market place and generates profit

13. Trade mark/name:

 A specific identification that makes it easy to recognise and distinguish competitor’s

products

14. Stock control:

 Is the process of ensuring that the business does not run out of raw material

 Is the process of ensuring that production will not be interrupted as a result of a

shortage of raw material

15. Production costs:

 Are the expenses that a business must pay in order to supply goods and services to

its customers

 Costs involved in the manufacturing and packaging of the product

16. Fixed costs:

 Are the costs that remain the same regardless of how many products are made

17. Variable costs:

 Are costs that are likely to change

18. Overheads:

 These are the additional costs that must be paid in order for the business to operate

19. Efficient production:

 Utilising material and human resources so that productivity is increased with little

wastage

20. Selling price:

 Production costs plus the profit

21. Mark up:

 Is the percentage or amount that is added to the cost price to cover all the

overheads expenses and still leave money over for a profit

22. Profit:

 Is the reward the business owner receives for investing money in the business

23. Cash flow projection (forecast):

 Is a document that shows the movement of money over a future/forecast period

24. Financial feasibility study:

 A study of whether a business will be a success after taking into consideration its

total costs and probable revenues

25. Sustainable profitability:

 A business that is in production for a long period of time, covers all expenses and

shows a profit

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26. SWOT analysis:

 A way to identify and analyse a company’s goals by assessing its strength, weakness,

opportunities and threats

27. Gross salary:

 Income/salary before deductions are made

28. Net salary:

 Income/salary after deductions are made

29. Competitive edge:

 A business that offers a better product than the local businesses

30. Work plan/implementation plan:

 Is a document that states what tasks are to be done to achieve your goals, with

reference to available time and human resources

31. Marketing mix:

 Variables of product, place, people, promotion and price are five elements of

marketing mix strategy that determines the success of the product in the market

place

32. Marketing strategy:

 A process that can allow an organisation to concentrate its resources on the optimal

opportunities with the goals of increasing sales and achieving a sustainable

competitive advantage