Business

• Business


  an organisation that provides goods or services

  
• Market


  where buyers (or customers) and sellers (businesses) meet to exchange goods and services
• Sole Trader


  a business owned by only 1 person who has unlimited liability
• Private limited company


  A business owned by shareholders who have limited liability, but shares in the business CAN NOT be SOLD on the stock market

  
• Franchise


  The right given by one business to another to sell goods or services using its name

  
• Franchisee


  A business that agrees to manufacture, distribute or provide a branded product under license by a franchisor
• Franchisor


  The business that gives franchisees the right to sell its products in return for a fixed sum of money or royalty payment

  
• Unlimited Liability


  A legal obligation on the owner of a business to settle all debts of the business. In law, there is no distinction between what the business and the owner owns and owes
• Limited Liability


  When shareholders of a company are not personally liable for debts of the company: the most they can lose is the value of their investment in the shares of the company

  
• Start up Fee


  The amount of money that the Franchisee pays to the Franchisor to use its name

  
• Shareholder


  The owner of a company entitled to a share of the profits each year
• Customer Needs


  The wants and desires of the customer
• Market Research


  The process of gaining information about customers, competitors and market trends through collecting primary and secondary data
• Primary Research


  The gathering of new information, which has not been collected before
• Secondary Research


  The collecting of information that has already been gathered by someone else and that already exists
• Quantitative Data


  Data which can be expressed as numbers and can be statistically analysed
• Qualitative Data


  Information about opinions, judgements and attitudes
• Market Segmentation


  a part of the market that contains a group of buyers with similar buying habits
• Added Value


  The increased worth that a business creates for a product.

  PRICE CHARGED - COST FROM SUPPLIERS
• Market Map


  A diagram that shows the range of possible positions for 2 features of a product. E.g Low to high price and low to high quality
• Enterprise


  A willingness by an individual or business to take risks, show initiative and undertake new ventures
• Entrepreneur


  A person who owns and runs their own business and takes risks
• Mindmap


  A diagram that is used to record words and ideas connected to a central word
• Creative Thinking


  Creating an idea that has not been done before (new and unique) and developing a competitive advantage as a result
• Competitive Advantage


  An advantage a business has that enables it to perform better than its rival like; better products, quality, customer service or creating a totally unique product
• Blue Sky Thinking


  A technique of thinking where participants are encouraged to think of as many ideas as possible about an issue or problem
• Lateral Thinking


  Thinking differently to try and find new and unexpected ideas, such as by using DE BONO'S SIX Thinking Hats
• Invention


  The discovery of new processes and potential new products, typically after a period of research
• Innovation


  The process of transforming inventions into products that can be sold to consumers
• Patent


  A right of ownership of an invention, design or process when it is registered with the government

  - Anyone copying this secured idea can be taken to court and sued

  - This must be registered with the Intellectual Property Office

  - This can last for 20 years from when they are first granted
• Copyright


  Legal ownership of material such as books, music and films which prevents these being copied by others

  - If other copies are made they can be taken to court and sued

  -This can last longer than a patent e.g. authors have this for their lifetime and 70 years after they die
• Trademark


  The symbol, sign or feature of a product or business that can not be copied by others

  - Businesses have to ensure they do not use a name already in use
• Calculated risk


  weighing up risks and rewards
• SMART


  Specific, Measurable, Agreeable/Achievable, Realistic/Relevant, Time-bound
• Objectives


  the goals a business is trying to achieve
• Financial Objectives


  targets expressed in monetary terms

  - profit

  -survival
• Non financial objectives


  targets not expressed in monetary terms

  - personal satisfaction

  - challenge
• Profit


  The difference between totoal revenue and total costs over a period of time

  TOTAL REVENUE - TOTAL COSTS
• Total Sales Revenue


  The income they recieve from selling their goods and services over a period of time

  PRICE × QUANTITY SOLD
• Sales Volume


  How many units are sold