Buss2 key terms

Frage	Antworten
Adverse variance	A difference between actual and budgeted amounts which is bad news – e.g. higher than budgeted costs
Advertising	Paid-for communication, aimed at informing or persuading
Assessment centres	Where a recruiting firm runs a series of extended selection procedures, each lasting one or two days or sometimes longer
Automation	The replacement of workers with machines to perform task in production
Boston Matrix	A model which analyses the product portfolio of a business into four categories (stars, cash cows, problem children and dogs)
Branding	The use of a trade name, symbol, logo or other device to differentiate a product or service
Budget	A detailed plan of income and expenses expected over a certain period of time
Business to business	Abbreviated to B2B, business-to-business involves the selling or products and services by one business directly to another
Capacity utilisation	The proportion of total capacity that is used (expressed as a percentage)
Communication	The process of exchanging information or ideas between individuals or groups
Competition	The businesses that compete for a share of a market
Competitiveness	The ability of a business to offer a better product than competitors (as measured by customers)
Cost reduction	Actions taken by a business aimed at reducing total costs, or lowering average unit costs
Customer expectations	What customers expect to receive as a result of buying a good or service; influenced by perceptions of factors such as quality and price
Customer service	The ways in which a business meets the needs and wants of its customers
Delegation	Where responsibility for carrying out a task or role is passed onto someone else in the business.
Direct selling	A method of distribution which involves a business transacting with a customer without the use of intermediaries
Distribution channel	How a business gets its products to the end consumer (with or without the use of intermediaries)
Empowerment	Delegating power to employees so that they can make their own decisions
External recruitment	Where candidates for a job vacancy come from outside the organisation
Factoring	A source of finance where a business receives a proportion of the amount owned by trade debtors from a specialist finance-provider
Favourable variance	A difference between actual and budgeted results which is good news. E.g. higher than budgeted revenue
Flexible working	Where a business uses a number of different working practices in order to suit the job in hand and the needs of employees
Hierarchy	The structure and number of layers of management and supervision in an organisation
Induction training	Training aimed at introducing new employees to a business and its procedures
Internal recruitment	Where candidates for a job vacancy come from within the organisation
Interview	Part of the recruitment process where a candidate is met face-to-face
Job description	A summary of the main duties and responsibilities of a job
Job design	The way in which tasks are combined to form a job
Job enlargement	Giving employees more tasks of a similar level of complexity. Job enlargement expands the number of tasks completed by an employee
Job enrichment	Making a job more interesting or varied so that is more rewarding
Labour productivity	The output produced per employee over a given time period
Loss leader	Where a price is set deliberately below the cost of production in order to attract customers who will buy other, more profitable products
Market research	The process of planning, collecting, and analysing data relevant to help make marketing decisions.
Marketing mix	The set of marketing tools that the firm uses to pursue its marketing objectives. Commonly taken to comprise product, price, promotion and place
Mass market	Describes the largest group of customers with specific needs and wants in an industry
Merchandising	Promotion of a product at the point-of-sale, usually in a retail environment
Net profit	Profit that remains after all operating costs are taken away from sales revenue. Net profit is usually stated before any deductions for tax.
Net profit margin	A measure of profitability. Net profit margin is calculated as net profit divided by sales revenue. The resulting figure is shown as a percentage
Niche market	A niche market is a focused segment of a larger market sector which is it possible to target
Off-the-job	Training that takes place away from the workplace (e.g. on a course)
On-the-job	Training that takes place at the workplace (e.g. being supervised and coached whilst working)
Organisational structure	The way that the roles and responsibilities within an organisation are structured
Output	The finished products (goods and services) that result from the production (or "transformation") process.
Overtime	Staff who work for less than a standard working week or day
Payment terms	The period of time that a supplier allows for an invoice to be settled
Penetration pricing	Pricing strategy that involves the setting of lower, rather than higher prices in order to achieve a large market share
Permanent employee	An employee who has a permanent position (i.e. not temporary) in a business
Person specification	A description which identifies the skills and experience that are likely to be held by a successful applicant for a job vacancy
Price elasticity of demand	The responsiveness of demand to a change in the price of a product
Price leader	A market leader business whose price changes are followed by rivals
Price skimming	Pricing strategy where a higher price is charged for new product to take advantage of customers prepared to pay for innovation
Price taker	A business that has no option but to charge the ruling market price
Pricing decisions	The decisions taken about how to price a product
Pricing strategies	The overall strategic approach to pricing over the medium-to-long term, often based on the market positioning of a product
Pricing tactics	The short-term pricing decisions and approaches taken - e.g. the temporary use of sales promotions or a short price war
Product life cycle	A theory which predicts the stages a product goes through from introduction to withdrawal from a market
Product portfolio	The collection of products and brands owned and operated by a firm
Productivity	Measures of output per worker over a given time period
Profitability	The ability of a business to generate profits from its activities. Profitability is often measured in terms of the return on sales (net profit margin) or return on investment (return on capital)
Promotional mix	The mix of activities and approaches taken to promoting a product, including advertising, direct selling etc.
Psychological pricing	Using price as a way of influencing a consumer's behaviour or perceptions, for example using high prices to reinforce a quality image
Public relations	The promotion of a business through news stories, sponsorship and similar activities. Usually shortened to PR.
Quality	Where a product meets a customer's requirements
Quality assurance	Organising every process to get the product 'right first time' and prevent mistakes ever happening
Quality control	The inspection of products as part of a sampling process to ensure that the right production standards have been achieved
Rationalisation	Reorganising production in order to increase productivity and efficiency. Often involves closure or relocation of production capacity.
Return on capital	A measure of the return made by investing in a business or business project. Return on capital is calculated as: (Net profit / Capital Invested) x 100 [shown as a percentage)
Robotics	The science and technology of robots, and their design, manufacture, and application
Sale & leaseback	A method of raising finance. Sale and leaseback involves a business selling a major asset (e.g. land & buildings) and then leasing the same asset back from the new owner.
Sales promotion	Tactical, point of sale material or other incentives designed to stimulate purchases
Selection	The process of deciding which applicant for a job a business should accept
Span of control	The number of employees who are directly supervised by a manager
Spare capacity	When a business is able to produce more with existing resources (also known as excess capacity)
Stock control	The processes and controls used by a business to ensure that it has sufficient (but not too much) stock for its purposes
Stocks	Raw materials, work-in-progress and finished goods held for resale. Stocks are sometimes also referred to as "inventories"
Sub-contracting	Delegation by one firm of a portion of its production process, under contract, to another firm, including in another country
Supplier	An individual, business or other organisation which provides goods or services to a customer or consumer
TQM (Total Quality Management)	An attitude to quality where the aims are zero defects and total customer satisfaction
Training	The provision of work-related education or skills development
Unit cost	The average production cost per unit
USP	USP is an acronym for "Unique Selling Point". A USP is a feature of a product or service that makes it stand out compared with the competition. If a USP is sustainable, then it can be a source of significant competitive advantage for a business.
Variance	The difference between the budgeted amount and what actually happens. A variance can be "positive" (favourable) or "negative" (adverse)
Waste	A cost of production. Sub-standard completed output or raw materials which are not retained in the production process
Workforce role	The tasks involved in a particular level or grade of job
Workload	The amount of work assigned to a particular worker, normally in a specified time period

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