Entrepreneur: an individual Leadership: the art or Democratic Leadership:

who undertakes to supply a process of motivating decisions are made with

good or service to the employees to carry out participation of staff,
market for profit. tasks willingly and although are ultimately
effectively made by the leader.
Autocratic Leadership: Paternalistic Leadership: Laissez-faire leadership:
decisions are made entirely leader takes all the virtually all authority is
by the leader, without staff decisions, but takes a kindly delegated to employees,
participation, and orders are and supporting approach to generally when employees
expected to be followed employees. are highly skilled and
without question. enthusiastic.
Market orientation: Product orientation: Market research: the
prioritizing the customers’s prioritizing high quality and collection and analysis of
wants and needs when the business’s own data relating to the
developing products strengths when developing marketing of goods and
products. services.
Primary research: research Secondary Research: Qualitative data: in-depth
of data that has been research of data that has research into the causes of
collected specifically for the already been collected for consumer behavior,
purpose in question, either some other purpose. attitudes, tastes, etc.
by the firm itself, or by a
market research agency.
Product differentiation: to Sample: a small group of Statistical bias: a situation in
offer different variations of people from a larger group which the characteristics of
a product, or market the (population), thought to the sample do not represent
same product in different represent the characteristicsthose of the population,
ways to different segments. of the population. because more people with a
particular characteristic
were questioned.
Interviewer bias: a situation Sampling discrepancy: a Market size: the size of a
in which the behavior of situation in which the market in terms of sales,
the interviewer leads to characteristics of the sample either number of units or
inaccurate data, e.g. because do not represent the value of goods sold.
the interviewer seemed to characteristics of the
encourage a particular population.
response.
Market share: the total sales Market growth: the Market segmentation: the
of one firm in a market as a percentage increase in the division of a market into
percentage of the total sales size of a market, measured groups of consumers with
in the market. through the level of total shared characteristics, like
sales, over a period of time. age, income, etc.
Niche marketing: the Mass marketing: the Quantitative data: numerical
marketing of a product to a marketing of a product to data like market share,
single, usually small all segments of a market in market size, etc.
segment of a market. almost the same way.
Unique Selling Point: a Overdraft: permission by Market positioning:
characteristic of a product the bank to let an account studying how consumers
that makes it unique or go into debit, up to a view or perceive a product
different from competing specified limit. Interest is in relation to competing
products. charged daily on the products e.g. through
amount of overdraft. market mapping.
Adding value: converting
inputs into output that is of
greater value to consumers
e.g. raw materials into
finished goods.
Trade-off: the loss of one
opportunity as a result of
taking another opportunity
e.g. choosing between
business ideas or new
products.
Debenture: a type of
security issued for finance
by a business to the public,
whereby the buyer becomes
a lender to the company,
and is paid a fixed amount
of interest annually over a
period of time.
Market mapping:
identifying key variables in a a machine from a leasing
product, plotting graphically company for a specific
how competing products
are located in terms of
combining two variables,
and identifying potential
gaps.
Trade credit: credit given by Limited liability: being liable
one company (e.g. a
supplier) to another (e.g. a
buyer).
Psychological pricing: an
approach to pricing that
reflects the psychological
impacts of pricing, and not with lots of competitors, in
just the economics of the
situation e.g. higher prices
= higher quality
Price skimming: charging a Fixed costs: costs that do
very high price for a new
product to make large
profits, then lowering the
price when competitors
enter the market.
Test marketing: launching a Stakeholder: someone who
product in a limited is affected, in monetary
geographical area to asses terms of otherwise, by the
consumer reaction to the activities of a business e.g.
product and identify consumers, employees,
problems with the product. shareholders, those living
near factories.
Retained profit: profits Loan: money lent on
made that are kept within condition that it is repaid,
the business, instead of within a specific date,
being distributed among the usually with interest.
owners of the business.
Venture capitalist: a Ordinary shares: securities
financier specializing in issued to the public,
funding new and whereby buyers become
innovative, but also high part owners of the
risk, businesses in exchange company, have voting
for shares in the business, rights when electing
in the hope that the directors, and are paid
business will grow over dividends based on profits
time.
Leasing: hiring an asset e.g. Leaseback: selling an asset,
and immediately leasing it.
This is used to raise finance
time, in exchange for for the business, while
paying rental charges. It is retaining use, but not
an alternative to buying the ownership, of the asset.
asset.
Cost based pricing: pricing
for business debts only to a product based on how
the extent of the amount much it cost to produce it,
invested in the company. and adding a profit margin.
This arises because the
business is a separate legal
entity.
Penetration pricing: Penetration: the extent to
charging a low price for a which a product has been
new product in a market accepted by the total
possible users, generally
the hope of gaining a expressed as a percentage.
significant market share.
Variable costs: costs that
not change with the level of change with the level of
output in the short run e.g. output, increasing when
rent more output is produced
e.g. raw materials, wages
Break even point: the level Margin of safety: the excess Contribution: the amount
of output at which all costs of the level of production that a transaction generates
are covered, and no profit over the break even level. It (revenue – variable costs) to
or loss is made. is the amount by which cover fixed costs and
production can fall before a produce a profit.
loss is made.
Competitive Advantage: an
advantage gained over
competitors by offering
better value, either through
lower prices, or something
that justifies a higher price,
like better advertising or
quality.