IB B&M "Utopia"
Terms in this set (70)
Someone who bears the financial risks and rewards of starting and managing a business or a commercial venture. Can develop new ideas or find a new way of offering an existing product.
A unit of ownership in a company with all the shares representing the total capital of the firm.
Private Limited Company
Incorporated business owned by shareholders who have limited liability. The shares of a private limited company cannot be bought by or sold to the general public.
Visual tool used to show customer's perceptions about the product or brand in relation to others in the market, against measures such as price and quality.
Intangible product provided by an organization.
Word of Mouth
Form of unpaid promotion whereby customers tell others about a business or its products. Important for all businesses, as happy and satisfied customers can influence many others especially in the age of social media and social networking.
A form of online promotion whereby content (information, images or video) is shared rapidly from one person to many others, often via social media and video-hosting websites.
Written document detailing how a business sets out to achieve its objectives and strategies. It is prepared by the owner(s) and describes the: market, sales strategy, operations, financial forecasts, and staffing needs of the business.
Norms and traditions within an organization or community.
Individuals or other organizations that are not part of the firm but have a direct interest in its operations. Examples include: customers, suppliers, competitors, outside investors, and government.
Growth of a business due to an increase in the size of an organization. Expansion is usually measured by an increase in sales revenue.
Method of stock control whereby materials and components are scheduled to arrive precisely when they are needed for production or sale. Saves money because holding large volumes or stock (inventory) can be very costly and wasteful.
Amount of a good or service that an organization is willing and able to product at different price levels. Supply increase when prices are higher as new entrants can cover their production costs and exisitng businesses earn greater profit margins.
Refers to the value of a good or service that is paid by the cusotmer. Price will usually cover the costs of production, allowing the business to earn profit.
Ethics refer to the moral principles and values that form the basis of how business activity is conducted. Ethical behavior means that a business acts in a socially responsible way towards its stakeholders.
External stakeholder groups that sell goods and services to other businesses.
Distinguishing name of a product or organization which is an intangible asset that differentiate a firm from competing products and businesses in the market.
Someone who treats employees as if they were family members, by guiding and consulting them. The leader has extensive authority over employees but decisions which he/she believes are in the best interest of the workforce.
An individual who owns and operates his or her own business, although they can employ other people to help run the organization. The firm's finance are inseparable from those of the owner, who has unlimited liability.
A business is product oriented if it focuses on the products ( goods and services) rather than focusing on the wants or needs of its customers. Product orientations places emphasis on building a high-qualitiy product in an efficient way.
The extent to which a product is fit for its purpose-- to meet the needs and wants of the customer by conforming to a certain standard. Dimensions of quality include: durability, reliability, customer service, after-sales care, and the physical appearance of the good.
Related to place in the marketing mix and refers to the entire process of getting the right products to the right place at the right time where the customers want them, all in the most cost-effective way possible.
Expansion of a business due to an increase in the size of an organization and/or growth in the industry. Can grow internally (organic growth) or externally (inorganic growth).
Decision-making organization involved in the production of goods and/or services to satisfy a need or a want of customers. Combines human, capital, and financial resources to create such goods and/or services.
Chain stores are a series of retail shops owned by a firm that operates under the same brand name. They sell the same products and are spread locally or globally with numerous outlets. Usually benefit from brand recognition and customer loyalty.
Merchant or vender that sells good and services directly to consumers, usually in small quantities. Contrasts with wholesalers and suppliers, who usually sell to other business customers.
A gift (usually financial) from one party to another, usually for charitable purposes or to benefit a particular cause.
Non-profit organization set up to provide help and raise money for those in need.
Long term goal of an organization. Helps give the business and its personnel a sense of purpose and strategic direction.
Organization owned by shareholders and operates in two or more countries. Headquarters are typically based in the country of origin.
Location where most, if not all, of the major strategic decisions of an organization are coordinated. Where the top executives work, managing and overseeing the important aspects of all business operations, such as company policies, regulations and processes.
Management process of identifiying, anticipating and satisfying consumers' requirements in a profitable way. It involves meeting customer's needs and wants by focusing on ensuring the product, price, place and promotion are effective in encouraging sales of the service or good.
Concerned with processing resources ( land, labour, capital, and enterprise) to provide outputs in the form of good and/or services. Aims to provides the right quantity and quality of goods or services in a cost-effective and timely manner.
Growth strategy in the Ansoff Matrix that involves Utopia trying to create new goods and services targeted at its existing markets. Complete process of bringing a new product or newly rebranded one to the market.
Consists of people and organizations in a particular geographic location that share common resources and interests in the area. They are an external stakeholder group consists of the business comunity, customers, and residents in a particular location.
Human Resource Manager
In charge of the personnel roles and functions in an organization, including: recruitment, selection, dismissal, training, and development of employees.
Monetary funds required either for the start-up of a new business venture, the day-to-day running, or expansion. Finance for a business can either be internal (such as retained profit) or external ( such as share capital or bank loans)
Someone who is willing to take risks and has the skills to make a business successful.
Entrepreneur who has the foresight and driving force behind a company's growth and development. Can see market charges and trends before they happen, or even set the trends.
Set of circumstances in the external business environment that create a chance or opening for further progress. Opportunity arises from being able to fulfil the unmet needs of customers.
Measures the degree to which customers consistently re-purcharse the same brand of a product over time rather than buying from rival suppliers. Strong brand loyalty exists when customers are committed to a certain brand and make repeat purchases time and time again. Marketing strategies designed to cultivate loyal customers can give organizations a competitive advantage.
Refers to the collective groups of existing and potential buyers and sells of a particular good or service.
Individuals or organizations who purchase goods or services from a business. All businesses strive to meet the needs and wants of their customers as they are a key external stakeholder group.
Business experiences a financial loss when its cost of products exceeds the sales revenue during a particular time period, usually a financial year. This means the money it earns from selling goods and services is insufficient to pay for all its production costs.
Refers to the reactive strategies used by an organization whenf aced with a sudden and unexpected emergency
Crisis Management Plan
Outlines the processes and procedures by which an organization intends to deal with a situation that could potentially harm or threaten its survival or long term liability.
(Crisis Planning) Involves designing proactive policies and procedures to deal with a crisis (emergency) in order to ensure the continuity of the business.
Items of expenditure by a business when producing its good and/or services.
(Organic Growth) occurs when a business expands using its own resources to increase the scale of its operations.
Internal sources of finance
Various methods by which an organization funds its operations with the use of third-party finance (external).
Owner's investment (start up or additional capital)
Sale of stock.
Sale of fixed assets.
Where the organization aspires to be in the future. It is therefore where the business ultimately wants to be. Gives an organization a clear sense of purpose.
Analytical tool that ranks the price and quality of different products, brands or firms according to the perceptions of customers.
An external factors that hinders the operations and profitability of an organization
Conscience of a business with consideration of the organization's actions on its various stakeholder groups and the natural environment, consumers, suppliers, employees and local communities.
Generic ways in which an organization can expand. According to the Ansoff Matrix, there are four different growth options for a business: market penetration, market development, diversification, and product development.
Marketing strategy used to move a brand to its desired position in the market. Enhancing the organization's reputation and its visibility in the industry. Involves market activities and processes to improve customoer's knowledge and perceptions of a brand.
(Job production) Production method that involves the manufacturing of unique or one-off orders for the specific requirements of each customer.
Gross Profit Margin
Profitability Ratio that measures the proportion of gross profit generated from the sales revenue of a business.
Costs which do not change with the level of output or sales.
Refers to spending by a business on acquiring, maintaining, and/or upgrading fixed assets in order to broaden its capital base. Represents a financial investment in the business ( purchase of equipment, machinery, and buildings)
Represents the premium that customers are willing to pay in order to buy a certain brand of a product rather than a rival product. Ensures a business can earn a high profit margin.
Process of gathering and interpreting information regarding the thinking patterns and buying habits of customers. Involves collecting primary and/or secondary data, which may be a of a quantitative or qualitative nature.
Profitability sampling method whereby researcher splits the sample into groups with a random sample chosen proportionately from each sub-population for research purposes. Helps minimise sampling bias as more representative sub-groups are used to generate market research results from surveys and interviews.
Surplus from sales revenue after all production costs have been deducted. Fundamental objective of most private sector organization. profit= sales revenue- total costs ( fixed costs + variable costs)
Factors that are beyond the control of the business yet have a direct impact on its operations and performance. (STEEPLE)= Social, technological, economic, ethical, political, legal, and environmental factors.
Describes how the final service or good passes from the producer to the consumer, such as using wholesalers and retailers. The end user may be a consumer of another business.
External method of growth involving two or more business pooling resources together to establish a new legal entity. It is a separate business in its own right.
Growth strategy (External) that involves an agreement between a business (the franchisor) giving the legal rights to other organizations ( the franchisees) to sell products under the franchisor's brand name.
Arises when factors that influence the operations of an organizations do not stay the same. It can be disruptive and settling, so the process must be managed carefully.
Refers to the various ways that businesses organizational their human resources. The framework is typically hierarchical and presented as an organizational chart, showing lines of authority (rights, duties, and responsibilities) and the channels of communication wihtin the organization.