Key Vocab (Not from Spec)

• Adding value

  How a business sells a product for more than it costs through the processes they apply
• Advertising

  Promotional method where a business pays to place an advert in a form of media, such as a newspaper or television
• Aesthetics

  The attractiveness of the design of a product
• Aims and objectives

  The overall goals of a business or organisation identifying what the business is trying to achieve
• Application form

  A method of applying for a job where the required details are decided by the business who is recruiting
• Autonomy

  The independence a worker has within their job
• Average rate of return

  The annual percentage profit that an investment makes compared to the cost of the investment
• Asset

  Any item of value that a business owns, such as its machinery or premises
• Bar gate stock control graph

  A method of displaying data on stock levels, which allows stock control policy to be decided, implemented and reviewed within a business
• Batch production

  Method of production where groups or types of products are made at several stages
• Bonus

  An extra amount of financial pay received through achieving a business target
• Branding

  What distinguishes a good or service from rivals
• Break even

  Where total revenue is the same as total costs and no profit or loss is made
• Buffer stock

  A quantity of stock kept in store to safeguard against unforeseen shortages or demands
• Business

  An organisation set up to meet customer demand and to make a profit for its owners
• Business environment

  The external factors such as the economy and the law that influence how a business operates
• Business plan

  A document produced by a new or existing business that shows what its objectives are and how it will meet them
• Brand loyalty

  A customer’s willingness to buy a product from a particular business rather than from its competitors
• Budgets

  Pre-set financial targets for a business to achieve, like a sales budget, or abide by, such as an expenditure budget, in a given period of time
• Bank loan

  A fixed sum of money lent by a bank to an individual or a business for a specific purpose, which must be repaid with interest in set payments over an agreed period of time
• Bank of England

  The central bank of the United Kingdom. It manages the country’s debts, sets interest rates and influences the exchange rate between the pound and other currencies
• Capacity

  The maximum production output a business can achieve with its existing resources
• Capital

  The initial money that is needed to start a business that is normally linked to purchases of machinery and premises
• Cash-flow

  The money that flows into and out of a business from sales and expenses
• Cash-flow forecast

  The prediction of how much money will come into and out of a business over a future time period
• Cash inflow

  The money that comes into a business from sales and other sources
• Cash outflow

  The money leaving a business that it spends on raw materials, labour and other expenses
• Centralised

  Where business decision making and implementation take place at and from the business headquarters
• Chain of command

  Part of the structure of a business organisation which shows who is in charge of who
• Consumer

  Someone who buys and uses goods and services
• Closing balance

  The total cash-flow left at the end of a period
• Commission

  The extra amount of pay workers receive as a percentage of their or the business’s sales
• Communication

  How messages are passed within a business or from a business to its customers
• Competition

  Other businesses that produce the same or similar goods or services
• Competitive advantage

  A business has a marketing mix which enables it to be more successful than its competitors
• Competitive environment

  The number and strength of other businesses in the same market
• Competitive pricing

  Where the price of a product is decided by comparing it to its rivals
• Disposable income

  How much money consumers have to spend on their needs and want
• Consumer law

  Legal constraints that protect the consumer from unfair business practice
• Consumer Rights

  Where consumers are protected by laws in terms of product quality, returning goods, repairs and replacements, digital content and delivery