KEY TERMS theme 2

• What are the approaches to pricing strategies?

  Cost-plus, competitive, penetration, skimming, promotional
• What are the ways to promote a product?

  Advertising, sales promotions, sponsorships
• What does distribution refer to in marketing?

  How a product gets from producer to customer
• What are the 4 Ps of the marketing mix?

  • Product
  • Price
  • Place
  • Promotion
• What are the ways of producing goods?

  Job, batch, or flow production
• What does stock management involve?

  Controlling stock levels, including JIT
• What is quality control?

  Checking products at the end of production
• What is quality assurance?

  Ensuring quality at every stage of production
• What is customer service?

  Support before, during, and after purchase
• How is gross profit calculated?

  Revenue - Cost of Sales
• How is net profit calculated?

  Gross profit - Expenses
• What is the formula for average rate of return?

  Average yearly profit / initial investment x 100
• What does cash flow refer to?

  The movement of money in and out of a business
• What is break-even?

  The point where total revenue = total costs
• What is internal (organic) growth?

  Growth from within the business
• What is external growth?

  Growth by joining with other businesses
• What is a merger?

  Two businesses join together to form one
• What is a takeover (acquisition)?

  One business buys another business
• What is a public limited company (PLC)?

  A company that can sell shares to the public
• What is retained profit?

  Profit kept in the business for reinvestment
• What is a franchise?

  A business model where a franchisor licenses their brand
• What is globalization?

  The process by which businesses operate in multiple countries
• What are ethical considerations in business?

  Decisions based on what is morally right
• What are environmental considerations in business?

  Decisions that consider the impact on the environment
• What are the stages of the product life cycle?

  • Introduction
  • Growth
  • Maturity
  • Decline
• What is the Boston Matrix used for?

  A tool to decide marketing strategy
• What is an income statement?

  A financial document showing profit/loss
• What does organizational structure refer to?

  How people and departments are arranged in a business
• What is recruitment?

  Attracting and selecting the right people for a job
• What is motivation in a business context?

  The reasons employees work hard