The collection of new, first-hand data for a specific purpose, directly from customers or the market, through methods such as surveys, interviews, focus groups and observations.
95 of the Business glossary’s terms, each with the part of the syllabus where you first meet it.
The exam taken by SL and HL students that is based on a pre-released statement and an unseen case study, with structured questions and one extended response, excluding HL-only content.
The exam with a quantitative focus, based on unseen stimulus material presented in parts, with structured questions including calculations and constructions, and an extended response.
The HL-only exam based on unseen stimulus material about a social enterprise, ending with a recommended plan of action marked against four criteria.
Tasks that do not depend on each other and can therefore be carried out at the same time, which shortens the duration of a project.
A contract of employment for fewer hours than a normal full working week, such as mornings, school hours or weekends only.
An approach to managing change in which employees take part in planning and implementing the change, which increases their commitment to it.
An unincorporated business owned by two or more people, who share its capital, decisions and profits and usually have unlimited liability for its debts.
A legal right granted by a government that gives the owner of an invention the exclusive right to make, use and sell it for a limited period, usually up to 20 years.
A leadership style in which the leader makes decisions in what they believe are the best interests of employees, often after consulting them, and looks after their welfare in return for loyalty.
The length of time it takes for the net cash flows from an investment to repay its initial cost.
The financial result of a particular outcome at the end of a branch of a decision tree, such as the revenue or profit it would bring, before the cost of the option is deducted.
A form of arbitration in which the arbitrator must choose either the employer’s final offer or the employees’ final claim in full, with no compromise between them.
Setting a low price when a product is launched in order to attract customers quickly and gain market share, with the intention of raising the price later.
In the marketing mix, the employees who deliver a service and interact with customers, whose skills, attitudes and behaviour shape the customer’s experience.
The value below which a given percentage of the values in an ordered data set lie; the 50th percentile is the median and the 25th and 75th are the quartiles.
A type of organisational culture in which the organisation exists mainly to serve the individuals in it, usually skilled professionals who work independently while sharing resources.
A document that sets out the qualifications, experience, skills and personal qualities needed by the ideal candidate for a job, often divided into essential and desirable criteria.
The owner's own savings or personal money invested in the business; the main source of start-up capital for sole traders.
Promotion in which sales staff communicate directly with individual customers, face to face or remotely, to persuade them to buy.
The tangible elements of a service that customers can see or touch, such as premises, décor, uniforms, equipment, packaging and websites, which help them judge its quality.
A circular chart divided into sectors, each showing one category’s share of a whole, with the angle of each sector proportional to that share.
A payment system in which employees are paid a fixed amount for each unit of output they produce.
A short slide presentation of a business plan that entrepreneurs use to persuade investors to fund a business, covering the problem, solution, market, business model, team, forecasts and finance requested.
The element of the marketing mix concerned with how and where a product is made available to customers, including distribution channels and outlets.
A recommended, sequenced set of decisions for an organisation, with reasons, timings, expected impacts and risks; in Paper 3 it answers the final question and is marked against four criteria.
The practice of designing products to wear out, break or become out of date after a limited time, so that customers need to buy replacements sooner.
Government actions and political conditions that affect a business, such as tax and spending policy, trade policy, subsidies, political stability and relations between countries.
The entire group of people or organisations that a piece of market research is about and wants to draw conclusions on.
Michael Porter's model of three basic ways to achieve competitive advantage: cost leadership, differentiation and focus, chosen by the source of advantage and the breadth of the target market.
A diagram that shows how customers perceive competing brands or products on two dimensions, such as price and quality, with the axes crossing in the centre.
The place a product or brand occupies in the minds of customers relative to competing products, in terms of features such as price, quality and image.
A type of organisational culture in which power and decision-making are concentrated in one person or a small group at the centre, with few rules and influence based on closeness to the leader.
The extent to which the less powerful members of organisations and institutions, such as the family, accept and expect that power is distributed unequally.
A short document issued about three months before Paper 1, giving the opening of the case study and a few contextual topics for students to research in advance.
Setting a price deliberately low, often below cost, to force competitors out of the market or deter new entrants so that prices can be raised later; illegal for dominant firms in many countries.
An AO4 command term asking for data from the stimulus to be put into a suitable format, such as a statement of profit or loss or a cash flow forecast.
The value today of a sum of money to be received in the future, found by discounting it at a chosen interest rate.
An organisation of people who share an interest or cause and campaign to influence the decisions of businesses, governments or the public on that issue, without seeking election.
The amount of money that customers pay to obtain a good or service, set by the business as one element of its marketing mix.
Charging different prices to different groups of customers for the same product, where the groups can be kept apart and differ in their willingness to pay.
Demand for which the percentage change in quantity demanded is greater than the percentage change in price, so that PED, ignoring its sign, is greater than 1.
A measure of the responsiveness of the quantity demanded of a product to a change in its price: the percentage change in quantity demanded divided by the percentage change in price.
Demand for which the percentage change in quantity demanded is smaller than the percentage change in price, so that PED, ignoring its sign, is less than 1.
The method a business uses to set the price of a product, chosen to suit its costs, competitors, customers and marketing objectives.
The collection of new, first-hand data for a specific purpose, directly from customers or the market, through methods such as surveys, interviews, focus groups and observations.
The part of the economy that extracts or harvests natural resources, such as agriculture, fishing, forestry, mining and oil extraction.
The part of the economy made up of organisations owned and controlled by private individuals or groups, most of which aim to make a profit.
An incorporated business with limited liability whose shares are not traded on a stock exchange and can be sold only with the agreement of existing shareholders.
The transfer of the ownership of an organisation, or the provision of a service, from the public sector to the private sector, often by selling shares to private investors.
The likelihood that an outcome will occur, expressed as a number from 0 (impossible) to 1 (certain); the probabilities of all outcomes at a chance node add up to 1.
In the marketing mix, the procedures, systems and activities through which a service is delivered to customers, from first contact to after-sales service.
A cooperative owned by producers, usually farmers, who combine to buy inputs, process and market their output, gaining scale and bargaining power.
A good or service, or a combination of both, that a business offers to the market to satisfy customers’ needs and wants.
A branding approach in which each product has its own separate brand name, often with little reference to the business that owns it.
A growth strategy in which a business sells new or modified products to its existing markets.
Making a product or brand distinct from competitors' products in ways that customers value, so that it is less easily substituted and can command loyalty or a higher price.
The stages a product passes through from launch to withdrawal (introduction, growth, maturity, saturation and decline), shown as the pattern of its sales over time.
A circular business model in which a business extends the working life of its products through durable design, repair, maintenance, upgrading, refurbishment or resale.
A group of closely related products sold by a business, such as different sizes, flavours or models of the same basic product.
An inward-looking approach in which a business focuses on developing and making products it believes are good, then tries to persuade customers to buy them.
The full range of products that a business sells, usually analysed to check that it holds products at different stages of the product life cycle.
The process of asking customers to return a product, or withdrawing it from sale, because it has been found to be faulty or unsafe.
A circular business model in which a business sells the use or result of a product as a service, such as leasing, renting or paying per use, while keeping ownership of the product and responsibility for its maintenance and recovery.
The process of using resources such as land, labour, capital and enterprise to make goods or provide services that satisfy customers’ needs and wants.
A measure of the efficiency of production that compares the quantity of output with the quantity of inputs, such as workers, labour hours or machines, used to produce it.
Total output divided by total input, multiplied by 100, usually with both measured in money; a rate above 100% means output is worth more than the inputs used.
In Handy's shamrock organisation, the permanent, highly skilled employees and managers whose knowledge is essential to the organisation and who are hard to replace.
The amount by which total revenue exceeds total cost in a period; if total cost is greater than total revenue, the result is a loss.
The regions of a break-even chart between the total revenue and total cost lines: the loss area left of the break-even point and the profit area to its right.
The profit a business makes from its operations, calculated as gross profit minus expenses, before interest on borrowing and tax are deducted.
The profit left after interest on a business's borrowing has been deducted from profit before interest and tax, and before tax on profits is paid.
A department, product, branch or other part of a business to which both costs and revenues can be attributed, so that its profit or loss can be calculated.
The profit left for the owners after interest and tax have been deducted, calculated as profit before tax minus tax; it is either paid out as dividends or kept as retained profit.
Profit before interest and tax expressed as a percentage of sales revenue, showing how much of each $1 of sales is left after cost of sales and expenses.
The objective of making the largest possible profit, by producing the output at which the difference between total revenue and total costs is greatest.
The transfer of profits earned by a multinational company's subsidiary in a host country back to the parent company in its home country.
The ability of a business to make a profit in relation to its sales revenue or the capital invested in it.
A ratio that measures profit as a percentage of sales revenue or capital employed, such as the gross profit margin, profit margin and ROCE.
A temporary set of related tasks with a defined start, a defined end and a specific objective, carried out within limits of time, cost and quality.
The planning, organising, monitoring and control of a project’s tasks and resources so that it meets its objectives on time, within budget and to the agreed quality.
An organisational structure in which work is arranged around temporary projects, with teams formed from people with the necessary skills and disbanded when each project ends.
The communication between a business and its customers that aims to inform them about, persuade them to buy, or remind them of a product or brand.
The combination of promotional methods, such as advertising, sales promotion, public relations, sponsorship, direct marketing and personal selling, that a business uses.
The tangible non-current assets a business uses in its operations, such as land, buildings, machinery, vehicles and computers, shown at cost in the statement of financial position.
Marking the options rejected at a decision node of a decision tree with two short parallel lines across their branches, leaving the option with the highest net gain (expected value minus cost).
Dividing a market according to customers' lifestyles, values, attitudes, interests and personality.
Setting prices that appeal to customers’ perceptions rather than to calculation, such as $9.99 instead of $10.
The management of a business’s reputation and relationships with the public and the media, for example through press releases, events and interviews.
The part of the economy made up of organisations owned and controlled by the government, which provide goods and services such as healthcare, education, defence and infrastructure.
An incorporated business with limited liability whose shares can be bought and sold by members of the public, usually on a stock exchange.
Reductions in average cost from buying inputs in bulk, which allows a large business to negotiate discounts and better credit terms from suppliers.
An employee’s sense that their work is meaningful and makes a positive difference to other people, the organisation or society.