Business paper 2

• Aim


  The intention to reach a goal
• Business plan


  A detailed statement of how the business intends to operate, either at start-up or during a given period of time
• Competition


  The rivalry between businesses looking to sell their goods/services in the same market
• Cost


  The money spent by a business on goods and services
• Customer


  Individuals, businesses or organisations that purchase goods/services and make decisions about which supplier to choose
• Customer satisfaction


  Whether customers are pleased with the goods/services they receive; whether they would purchase again
• Demand


  The quantity of a particular product that will be bought at particular price over a specific time
• Directors


  The people who are elected by the shareholders to run the business on their behalf
• Diseconomies of scale


  When a business grows too large, leading to a possible increase in unit cost
• Dividend


  A portion of the after-tax profit that is paid to shareholders according to the number of shares they own
• 1. commerce


  Business transactions carried out electronically on the internet
• Economies of scale


  The cost advantage of producing on a large scale. As output increases the unit cost decreases
• Employees


  Individuals who work full time or part time for the business; they have a contract of employment detailing their duties and rights
• Enterprise


  The ability to identify business ideas and opportunities to bring them to fruition and to take risks where appropriate
• Entrepreneur


  A person who has the vision to use initiative to make business ideas happen, managing the resources and risks
• Ethical objectives


  A business' goals that relate to fair business practice or moral guidelines and make a positive contribution to the business' reputation
• Ethics


  The moral principles that guide how a business operates
• Expansion


  The process of increasing a business' size
• Export


  Good/service sold to a customer in another country
• External growth


  The growth of a business by joining with another by merger or takeover
• Factors of production


  The elements that combine in the production process: land, labour, capital and enterprise
• Fixed costs


  The costs that stay largely the same, regardless of the business' output
• Franchising


  The sale of the rights to use/sell a product by a franchisor to a franchisee
• Gap in the market


  An opportunity for a new business (or expansion) which may meet a need that is not being met
• Goods


  Items that are produced from raw materials for sale to businesses or consumers
• Growth


  A business' increase in size. Methods include: asset value, employees, market share, markets, profits and sales
• Import


  Good/service bought from a supplier in another country
• Integration


  Two or more businesses join together
• Limited liability


  The owners are not responsible for the debts of the business. The limit of their liability for the business' debts is the amount they invested
• Local community


  The individuals, other businesses and organisations that are located close to the business. The business interacts with these groups
• Location


  The site of a business and the reasoning behind the choice of site
• Loss


  Where expenditure is greater than income
• Market


  Where those wishing to buy goods/services make contact with those who have them to sell
• Market share


  The proportion of the whole market for a product that is held by the business
• Mergers


  When two or more businesses agree to join together
• Not-for-profit organisations


  Associations, charities, co-operatives or voluntary organisations set up to further non-monetary ideals such as cultural, educational, religious and public service
• Objective


  A specific statement that defines a precise goal that can be measured and delivered within a given time
• Opportunity cost


  The cost of making one choice concerning the use of limited resources at the expense of an alternative choice
• Organic growth


  A business grows by increasing its output, by increasing its customer base or by developing new product(s)
• Outsourcing


  Contracting another business to carry out some of the business' activities, often to reduce costs