alevel business year 1

• entrepreneur


  an individual who has the idea for a new business, starts it up and carries most of the risks but benefits from the rewards.
• customer


  individual consumer or organisation that purchases goods or services from a business.
• consumer


  individual consumer or organisation that purchases goods or services from a business.
• consumer goods


  physical and tangible goods sold to consumers that are not intended for resale.

  These include durable consumer goods, such as cars and washing machines, and non-durable consumer goods, such as food, drinks and sweets, that can be used only once.
• consumer services


  non-tangible products sold to consumers that are not intended for resale. These include hotel accommodation, insurance services and train journeys.
• factors of production


  the resources needed by business to produce goods and services
• capital goods


  The physical goods used by industry to aid in the production of other goods and services, such as machines and commercial vehicles
• enterprise


  the action of showing initiative to take the risk to set up a business
• adding value


  increasing the difference between the cost of bought-in inputs (materials) and the selling price of the finished goods.
• added value


  the difference between the cost of purchasing bought-in inputs (materials) and the selling price of the finished goods.
• branding


  process of differentiating a product by developing a symbol, name, image or trademark for it.
• opportunity cost


  the next most desired option that is given up
• multinational business


  business organisation that has its headquarters in one country, but with operating branches, factories and assembly plants in other countries.
• intrapreneur


  business employee who takes direct responsibility for turning an idea into a profitable new product or business venture.
• business plan


  written document that describes a business, its objectives, its strategies, the market it is in and its financial forecasts.
• private limited company (ltd)


  business that is owned by shareholders; this company cannot sell shares to the general public and the owners are legally responsible for its debts only to the extent of the capital they invested

  or

  A business that is owned by its shareholders, run by directors and where the liability of shareholders for the debts of the company is limited.
• public limited company (plc)

  company whose shares are traded on a stock exchange and can be bought and sold by the public.
• Primary Sector Business Activity

  Firms engaged in farming, fishing, oil extraction and all other industries that extract natural resources so that they can be used and processed by other firms
• Secondary Sector Business Activity

  firms that manufacture and process products from natural resources, including computers, brewing, baking, clothes making and construction
• Tertiary Sector Business Activity


  firms providing services to consumers and other businesses, such as retailing, transport, insurance, banking, hotels and tourism
• Quartenary Sector Business Activities

  businesses providing information services, such as computing, web design, ICT (information and communication technologies), management consultancy and R&D (research and development, particularly in scientific fields).
• public sector


  Organisations that are owned and controlled by local or central government.
• private sector


  Businesses owned and controlled by individuals or groups of individuals
• sole trader


  A business in which one person provides the permanent finance and, in return, has full control of the business and is able to keep all of the profits
• unlimited liability


  business owners have full legal responsibility for the debts of the business
• partnership


  a business farmed by two or more people to carry on a business together, with shared capital investment and usually shared responsibilities
• limited liabilty


  the only liability - or potential loss - a shareholder has, if the company fails, is the amount invested in the company, not the total wealth of the shareholder.
• share


  certificate confirming part-ownership of a company and entitling the shareholder owner to dividends and certain shareholder rights.
• shareholder


  person or institution owning shares in a limited company.
• franchise


  legal right to use the name, logo and trading systems of an existing successful business.
• franchiser


  person or business that sells the right to open stores and sell products or services, using the brand name and brand identity.
• franchisee


  person or business that buys the right from the franchiser to operate the franchise.
• cooperative


  jointly owned business operated by members for their mutual benefit, to produce or distribute goods or services - as in consumers' cooperatives or farmers' cooperatives.
• joint venture


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


  business with mainly social objectives that re-invests most of its profits into benefiting society rather than maximising returns to owners.
• renvenue


  the total value of sales made during the trading period = selling price × quantity sold.
• capital employed


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


  the total value of a company's issued shares.
• market share


  sales of the business as a proportion of total market sales

  Formula:

  Marketshare(%)=total sales of business/total sales of industry x 100
• Corporate Social Responsibility (CSR)

  when businesses consider the interests of society by taking responsibility for the impact of their decisions and activities on customers, employees, communities and the environment.