104 of the Business glossary’s terms, each with the part of the syllabus where you first meet it.
A fixed amount of pay for a year’s work, usually paid in equal monthly instalments, regardless of the exact hours worked or output produced.
The sale of an asset, usually property, to another party, which then leases it back to the seller, so that the business receives cash but continues to use the asset.
Raising finance by selling items the business owns and no longer needs, such as unused buildings, land, machinery or vehicles, or a part of the business.
A qualitative forecasting method in which the sales estimates of individual salespeople for their own territories or customers are added together to give a forecast for the whole business.
The process of predicting the future sales of a business, in volume or value, over a given period, using past sales data, market information and judgment.
A short-term incentive to encourage customers to buy, such as a discount, coupon, free sample, competition or “buy one, get one free” offer.
The value of the goods and services a business sells during an accounting period, calculated as the price of each item multiplied by the quantity sold; the first line of the statement of profit or loss.
The objective of making the highest possible sales revenue, even if this means accepting lower profit, for example to grow market share or meet managers' sales targets.
A group of people selected from a population to take part in market research, whose answers are used to draw conclusions about the whole population.
The number of people, or other members of the population, included in a sample for market research.
The process of selecting a group of people from a population to take part in market research, so that conclusions about the population can be drawn from the group.
The difference between a result from a sample and the true value for the whole population, caused by chance because only part of the population was studied; it falls as sample size rises.
The stage of the product life cycle in which the market is full, so sales stop growing and firms can grow only by taking customers from competitors.
A graph that plots pairs of values of two variables as points, with the independent variable on the x-axis and the dependent variable on the y-axis, to show whether they are related.
A model of organisational culture with three levels: artefacts (visible signs such as dress and layout), espoused values (what the organisation says it believes) and basic underlying assumptions (unspoken beliefs taken for granted).
An approach to management decision-making based on the systematic collection and analysis of data, measurement and evidence, so that decisions are logical and can be justified.
A regular and predictable movement of data above or below the trend that repeats within a fixed period, usually a year, because of the seasons, holidays or customs.
The use of data that already exists, collected by someone else or for another purpose, such as market analyses, government publications, academic journals, media articles and online content.
The part of the economy that processes raw materials into finished or semi-finished goods, including manufacturing and construction.
A shift in the relative importance of the primary, secondary, tertiary and quaternary sectors in an economy, measured by their shares of output or employment.
The process of choosing the most suitable candidate for a job from those who applied, using methods such as interviews, tests and references.
The highest level in Maslow’s hierarchy of needs: the need to fulfil one’s potential, for example through challenging, creative and meaningful work.
An appraisal method in which employees evaluate their own performance against their objectives, usually before discussing it with their manager.
A cost with both a fixed element, paid regardless of output, and a variable element that changes with output, such as a utility bill with a standing charge.
The person or group who starts a communication by encoding an idea into a message and choosing the medium through which to send it.
The status of an incorporated business, which exists in law independently of its owners, so that it can own assets, enter contracts, sue and be sued in its own name.
Tasks that must be carried out one after another, because each depends on the completion of the task before it.
Intangible products, such as banking, education, healthcare and transport, that are provided to customers but cannot be stored or physically owned.
The extended marketing mix used for services: product, price, promotion and place plus people, processes and physical evidence.
Loans and other borrowing a business must repay within one year, shown as other short-term loans under current liabilities in the statement of financial position.
Finance that must be repaid within one year, such as an overdraft or trade credit, used mainly to pay for working capital.
The process of selecting, from all applicants for a job, the small number who best match the person specification and will be invited to interview or further selection.
A statistical method that fits a straight line, y = a + bx, to data on two variables in order to describe the relationship between them and to predict one from the other.
An agreement in which an employer recognises only one trade union to represent all the employees at a workplace or in a company for the purposes of collective bargaining.
An approach to leadership in which the leader adapts their style to the situation, especially to the competence and commitment of employees and the nature of the task, as in the Hersey–Blanchard model.
A distribution of data that is not symmetrical, with a longer tail on one side; in a positively skewed distribution the tail is to the right and the mean is greater than the median.
A business whose number of employees, and often its sales revenue or assets, is below limits set by a government; in the European Union, fewer than 250 employees.
Objectives that are specific, measurable, achievable, realistic (or relevant) and time-bound, so that they are clear to everyone involved and progress towards them can be checked.
A sampling method in which existing respondents recommend or recruit further respondents from among their contacts, used to reach small or hard-to-find groups.
An approach to marketing that meets customers' wants profitably while also protecting or improving the long-term well-being of consumers, society and the environment.
An unincorporated business owned by one person, who has full control, keeps all the profit and has unlimited liability for its debts.
The ways in which a business obtains the money it needs, either from within the business (internal sources) or from outside it (external sources).
The number of subordinates who report directly to one manager or supervisor.
A one-off order from a customer, usually for a large quantity at a price below the normal selling price, which a business must decide whether to accept.
The division of work into separate tasks, each carried out by a worker or team that concentrates on it, which raises skill and output per worker.
A form of promotion in which a business pays to be associated with an event, team, programme or person in order to raise awareness and improve its image.
An individual or group that has an interest in the activities of a business, because they affect the business or are affected by its decisions.
A situation in which the interests or objectives of different stakeholder groups cannot all be met at the same time, so that a decision benefits some groups at the expense of others.
A method of analysing stakeholders by placing each group on a matrix according to its power over the business and its interest in a decision, in order to decide how to manage it.
A measure of the spread of a data set that shows how far, on average, the values lie from the mean; a larger standard deviation means more widely spread data.
The use of the same, or largely the same, marketing mix in every country in which a business operates, in order to build one global brand and gain economies of scale.
A product with a high relative market share in a fast-growing market, which earns a lot of cash but also needs heavy investment to keep its position.
A newly established business in its early stages of operation, usually small and with limited finance, that is developing its product and building its first customers.
The finance needed to set up a new business and pay for its first assets and costs before it generates enough revenue to cover them.
An AO1 command term asking for a specific name, value or other brief answer, without explanation or calculation.
A business owned and controlled, wholly or mostly, by the government that sells goods or services to customers as a private sector business does.
A financial statement that shows what a business owns (assets), what it owes (liabilities) and the owners' equity at one particular date, usually the last day of the accounting period.
A financial statement that shows a business's sales revenue, costs and profit or loss over an accounting period, usually one year, and how the profit is divided between tax, dividends and retained profit.
A framework for analysing the external environment of an organisation under seven headings: social, technological, economic, environmental, political, legal and ethical factors.
The text, data, tables or images given in an exam paper about an organisation, which answers must use as their context.
The raw materials, work in progress and finished goods a business holds for production or sale; shown as a current asset and also called inventory.
A line graph showing the stock level of an item over time, with its maximum stock level, reorder level and buffer stock, used to plan when to reorder and how much to order.
A regulated market on which the shares of publicly held companies and other securities are bought and sold.
An efficiency ratio that measures how quickly a business sells its stock, as cost of sales divided by average stock (times a year) or as the average number of days stock is held.
The situation in which a business has no stock of an item left when it is needed, so that production stops or customers cannot be supplied.
A method of depreciation that charges the same amount each year, calculated as the cost of the asset minus its residual value, divided by its useful life in years.
An agreement between two or more independent businesses to cooperate and share resources to achieve shared objectives, without creating a new business.
A division of a large organisation that serves a distinct market with its own products, objectives and management, and is planned and assessed as a separate business.
The long-term objectives of an organisation as a whole, set by senior management, that determine its overall direction and the strategies it follows.
A long-term plan of action, set by senior managers, that shows how a business intends to achieve its aims and strategic objectives.
A sampling method in which the population is divided into groups (strata) and a random sample is taken from each group, usually in proportion to its size.
Internal factors that give an organisation an advantage over its competitors or help it to achieve its objectives, such as a strong brand, skilled staff or a sound financial position.
A form of industrial action in which employees collectively stop working for a period, in order to pressure the employer to meet their demands.
An organisational culture in which the core values and norms are clearly defined, widely shared and deeply held by employees, so that behaviour is consistent across the organisation.
An organisational structure in which employees are grouped into departments by the function they perform, such as marketing, finance, human resources and operations.
An organisational structure in which the business is divided into divisions based on its products or product lines, each with its own functional staff.
An organisational structure in which the business is divided into divisions based on geographical areas, each responsible for its operations in that region.
The position of a business that has neither the lowest costs nor a clear source of differentiation, so it lacks a competitive advantage and usually earns below-average profits.
An employee who reports directly to a manager or supervisor above them in the hierarchy and works under that person's authority.
A company that is owned and controlled by another company, its parent company, which holds more than half of its shares; an overseas subsidiary operates in a foreign market on the parent’s behalf.
A payment from the government to a business that reduces its costs of production or the price of its product, usually paid on a continuing basis.
An AO2 command term asking for a possible solution, explanation or answer to be proposed, with a reason.
A review at the end of a period, usually a year, that judges an employee’s overall performance against set criteria, often with a rating used for pay or promotion decisions.
The network of organisations, activities and resources involved in moving a good or service from raw materials, through production, to the final consumer.
The planning, coordination and control of all the activities and organisations in a supply chain, from sourcing raw materials to delivering the final product, so that it runs efficiently and meets customer needs.
The three to five sources, published within three years before submission and chosen by the student, from which most of the information in a business research project comes; they are labelled, highlighted and attached.
The amount by which the income of a non-profit organisation exceeds its spending over a period, which is kept in the organisation rather than distributed to owners.
A primary research method that collects information from a sample of people by asking each of them the same set of questions, usually in a questionnaire.
The objective of continuing to trade by covering costs and having enough cash to pay debts as they fall due; the main objective of most start-ups and of businesses in a crisis.
A key concept: meeting the needs of the present without compromising the ability of future generations to meet their own needs, considering social, environmental and economic effects.
A planning tool that assesses an organisation’s current position by identifying its internal strengths and weaknesses and the external opportunities and threats in its environment.
The extra value created when two businesses combine, because together they can achieve lower costs or higher revenues than they could separately.
An independent assessment of the impact of a business's activities on society and the environment, such as its treatment of workers, community involvement and emissions.