AQA GCSE BUSINESS STUDIES | Schemes and Mind Maps Business

AQA GCSE BUSINESS STUDIES - KEY WORDS

Unit 1 Business in the Real World

1.1 The Purpose and nature of Business

Good: A physical product, such as a car

Service: An intangible product (that is, you cannot touch it), such as financial advice or a bus journey

Customer: Someone who buys a product from a business

Consumer: Someone who uses goods and services produced by businesses

Entrepreneur: Someone who is willing to take the risks involved in starting a new business

Entrepreneurship: The ability to be an entrepreneur – to take risks to develop a business idea

Social Enterprise: A business that is set up to help society rather than to make a profit

Resources: The inputs that businesses use to provide their goods or services

Enterprise: Another word for a business. It also refers to the skills of the people involved in the business to identify

business opportunities and bring together resources to meet these opportunities.

Interest: The money paid by banks as a reward to attract people to save with them

Interest rates: The cost of borrowing money or the reward for saving money, expressed as a percentage.

Inflation: The rate at which prices are increasing. For example, if inflation is 2 per cent, prices are generally growing

by 2 per cent that year

Gross Domestic Product (GDP): Another word for a business. It also measures all the income earned in a country’s

economy in a year.

1.2 Business Ownership

Sole trader: Someone who sets up in business on his or her own

Profit: Measures the difference between the values of a business’s revenue (sales) and its total costs

Unlimited liability: Means that the personal possessions of the owners of a business are at risk if there are any

problems; there is no limit to the amount of money the owners may have to pay out

Partnership: Occurs when two or more people join together in a business enterprise to pursue profit

Deed of partnership: An agreement between partners that sets out the rules of the partnership, such as how

profits will be divided and how the partnership will be valued if someone wants to leave.

Stakeholders: Individuals and organisations that are affected by, and affect, the activities of a business

Company: A business that has its own legal identity; it can own items, owe money, sue and be sued

Shareholder: A person or an organisation that owns part of a company; each shareholder owns a ‘share’ of the

business

Stock exchange: A market for buying and selling shares of public limited companies; large numbers of shares are

being bought and sold all the time.

Flotation: Occurs when a private limited company (ltd) becomes a public limited company (pic) and has its shares

listed on the Stock Exchange

Not-for-profit organisation: Set up to achieve objectives other than profit, for example a charity

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AQA GCSE BUSINESS STUDIES - KEY WORDS

Unit 1 Business in the Real World

1.1 The Purpose and nature of Business Good: A physical product, such as a car Service: An intangible product (that is, you cannot touch it), such as financial advice or a bus journey Customer: Someone who buys a product from a business Consumer: Someone who uses goods and services produced by businesses Entrepreneur: Someone who is willing to take the risks involved in starting a new business Entrepreneurship: The ability to be an entrepreneur – to take risks to develop a business idea Social Enterprise: A business that is set up to help society rather than to make a profit Resources: The inputs that businesses use to provide their goods or services Enterprise: Another word for a business. It also refers to the skills of the people involved in the business to identify business opportunities and bring together resources to meet these opportunities. Interest: The money paid by banks as a reward to attract people to save with them Interest rates: The cost of borrowing money or the reward for saving money, expressed as a percentage. Inflation: The rate at which prices are increasing. For example, if inflation is 2 per cent, prices are generally growing by 2 per cent that year Gross Domestic Product (GDP): Another word for a business. It also measures all the income earned in a country’s economy in a year. 1.2 Business Ownership Sole trader: Someone who sets up in business on his or her own Profit: Measures the difference between the values of a business’s revenue (sales) and its total costs Unlimited liability: Means that the personal possessions of the owners of a business are at risk if there are any problems; there is no limit to the amount of money the owners may have to pay out Partnership: Occurs when two or more people join together in a business enterprise to pursue profit Deed of partnership: An agreement between partners that sets out the rules of the partnership, such as how profits will be divided and how the partnership will be valued if someone wants to leave. Stakeholders: Individuals and organisations that are affected by, and affect, the activities of a business Company: A business that has its own legal identity; it can own items, owe money, sue and be sued Shareholder: A person or an organisation that owns part of a company; each shareholder owns a ‘share’ of the business Stock exchange: A market for buying and selling shares of public limited companies; large numbers of shares are being bought and sold all the time. Flotation: Occurs when a private limited company (ltd) becomes a public limited company (pic) and has its shares listed on the Stock Exchange Not-for-profit organisation: Set up to achieve objectives other than profit, for example a charity

1.3 Setting Business Aims and Objectives Aim: A general goal of a business Objective: A specific target that is set for a business to achieve Public sector organisations: Owned by the government Private sector organisations: Owned by individuals Market share = 𝑆𝑎𝑙𝑒𝑠 𝑜𝑓 𝑎 𝑝𝑟𝑜𝑑𝑢𝑐𝑡 𝑥 100 𝑇𝑜𝑡𝑎𝑙 𝑚𝑎𝑟𝑘𝑒𝑡 𝑠𝑎𝑙𝑒𝑠 1.4 Stakeholders Dividends: The financial rewards paid out to shareholders each year Negotiation: When two sides discuss what they want and try to reach a solution Stakeholders: Individuals and organisations that are affected by, and affect, the activities of a business 1.5 Business Location Protectionist measures: Policies that governments use to protect their own businesses against foreign competition Tariff: A tax on foreign goods imported into a country Imports: Goods and services purchased from overseas by consumers of businesses Quota: A limit on the number of foreign goods imported into a country 1.6 Business Planning Business plan: A document setting out what a business does and what it hopes to achieve in the future Business planning: The process of producing a business plan Uncertainty: Occurs where there is a lack of information about a situation; this means the outcome or consequences are very difficult to predict Risk: The possibility of something going wrong Revenue: The income that a firm receives from selling its goods or services; it is also referred to as ‘turnover’; it is measured by the number of units sold multiplied by the price Fixed costs: Costs that do not change when a business changes its output Variable costs: Costs that vary directly with the business’s level of output Total costs: Fixed costs plus variable costs 1.7 Expanding a Business Internal growth (also known as organic growth): Occurs when a business gets bigger by selling more of its products External growth (also called integration): Occurs when a business gets bigger by joining or buying other businesses Market capitalisation: Measures the value of all a business’s shares = 𝑚𝑎𝑟𝑘𝑒𝑡 𝑝𝑟𝑖𝑐𝑒 𝑜𝑓 𝑎 𝑠ℎ𝑎𝑟𝑒 𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑠ℎ𝑎𝑟𝑒𝑠

Unit 2: Influences on business

2.1 Technology Information and communications technology (ICT): Computing and communications systems that a business might use to exchange information with stakeholders Stakeholders: Individuals and organisations that are affected by, and affect, the activities of a business Intranets: Communication networks which can only be accessed by an organisation’s employees Extranets: Similar to intranets but are also accessible to other organisations such as suppliers Software robots: Advanced computer programs that can operate a range of administrative activities previously carried out by employees Cloud computing: Delivery of specialist computing services, such as storage of very large amounts of data, provided by businesses using the internet E-commerce (electronic commerce): The act of buying or selling a product using an electronic system such as the internet M-commerce (mobile commerce): The buying and selling of products through wireless handheld devices such as smartphones Digital communication: Transmitting information digitally between computing devices Webchat: Simple means of communicating in real time (instantly) using only web browsers (e.g. Firefox, Edge, Chrome). Apps (applications): Pieces of software designed for a specific purpose and for use on smartphones and tablets Social media: Methods of online communication such as websites and applications; they share information and help to develop social and professional contacts A Shareholder: is a person or organisation that owns part of a company. Each shareholder owns a ‘share’ of the business. 2.2 Ethical and Environmental Considerations Ethics: Whether a business decision is thought to be morally right or wrong; an ethical decision is made on the basis of what is judged to be morally right Profit: Measures the difference between the values of a business’s revenue (sales) and its total costs Fair trade products: Products for which customers pay higher prices and offer better trading terms, such as payments with orders; the aim is to improve the living standards of people in poorer countries Social responsibility: An approach to managing businesses in which the interests of all groups in society are taken into account when making decisions The environment: The natural world in which we live; the landscape and its natural features, such as the seas, rivers, forests and mountains External costs of production: When a business’s activities result in harmful effects on other people not directly involved in production Non-renewable resources: Resources of which only a finite amount exists such as coal and oil Global warming: The gradual heating of Earth’s surface, oceans and atmosphere Pressure group: A group of people with a common interest who influence public opinion and decisions by businesses and governments

Environmental responsibility: Taking of decisions by businesses, consumers, governments and other groups with the intention of protecting the environment Sustainability: Methods of production which can be continued in the long term without damage to the environment. Recycling: The reuse of raw materials used in making products, often for many times. Examples include the reuse of glass, paper and metals Environmental reporting: is the publication of a business’s environmental performance to the general public. 2.3 The economic climate of business The economy: Made up of millions of individual consumers, many thousands of businesses and governments; all take decisions on what to buy and produce Consumers: Are individuals who buy goods and services from businesses Economic climate: The state of key factors within a country such as the level of goods and services produced and the number of jobs available Interest rates: The cost of borrowing money or the reward for saving money, expressed as a percentage Overdraft: A flexible loan which businesses can use, whenever necessary, up to an agreed limit Consumer spending: Refers to the value of goods and services bought by consumers over a time period, usually a month or a year Income elastic products: Those products whose sales are sensitive to changes in consumers’ incomes 2.4: Globalisation Globalisation: The trend for markets to become worldwide in scope Multinational company (MNC): A company that produces goods and services in more than one country (also called transnational corporations) International trade: The selling of goods and services across national frontiers Exports: Goods and services produced by a business in one country and sold in a different one Economies of scale: When a business’s unit costs of production fall as its output rises and the business expands Inward investment: When governments, businesses and individuals invest capital into another country, for example building new factories or buying companies Takeover: When one business buys control of another one Product design: Translates the needs of consumers, or the inventiveness of entrepreneurs, into a saleable product Quality: The extent to which a consumer is satisfied with a product Price: The amount a business asks a customer to pay for a single product Exchange rate: The price of one currency expressed in terms of another Imports: Goods and services purchased from overseas by consumers and businesses

Unit 3: Business Operations

3.1 Production processes

Production (or operations) management: All the activities in managing the transformation process

Production: The process of changing inputs such as labour services into goods and services that can be

sold

Job production: A method of production in which a product is supplied to meet the exact requirements of

a customer

Flow production: When an item moves continuously from one stage of the process to another

Specialisation: When individuals focus on a limited number of tasks

Lean production: An approach to production that aims to minimise waste

Just-in-time (JIT) production: Holds as little stock as possible; items are ordered just in time to be used

Kaizen: ‘Continuous improvement’ – an approach to production that aims to achieve change from a series

of small steps

3.2 The role of procurement

Just in case (JIC) production: Holds stocks just in case there is a delay from supplies or a sudden unexpected increase in demand Purchasing economies of scale: When the cost per unit falls if large orders are placed with suppliers due to a bulk discount Procurement (or purchase): Selecting suppliers, establishing the terms of payment and negotiating the contract The supply chain: All the businesses, people and activities that take part in the production processes from the start until it gets to the customer Logistics: The movement of goods, services, information and money throughout the production process Lean production: An approach to production that aims to minimise waste 3.3 The concept of quality Total quality management (TQM): An approach to quality in which everyone is focused on preventing errors occurring and ensuring quality at each stage of the production process 3.4 Good customer service Customer service: The part of a business’s activities that is concerned with meeting customers’ needs as fully as possible Positive customer engagement: When customers have a positive experience from their contact with the business Post-sales (or after-sales) service: Meeting customers’ needs after they have purchased a product, for example by repairing or servicing the product Premises: The buildings used by businesses – these may include offices, shops and factories Customer loyalty: A business’s customers make repeat purchases because they prefer the business’s products to those of its rivals

Information and communications technology (ICT): Computing and communications systems that a business might use to help to exchange information with stakeholders E-commerce (or electronic commerce): The act of buying or selling a product using an electronic system such as the internet. M-commerce (or mobile commerce): Buying and selling products through wireless handheld devices such as smartphones Global markets: Made up of customers from across the world Social media: Involves methods of online communication such as websites and applications; they share information and help to develop social and professional contacts Data analysis: Gathering and examining data to provide useful information that can be used for decision-making

Contract of employment: A legal document stating the hours of work, rates of pay, duties and other

conditions under which a person is employed

Full-time employment: Occurs when someone works a number of hours equal to the normal working

week, normally between 35 and 40 hours

Part-time employment: Takes place when an employee works for fewer than the normal number of

working hours per week

Job share: Exists when two or more employees agree to share the responsibilities of a single job.

Zero hours contract: Allows employers to hire staff without any guaranteed hours of work

4.3 Motivating employees

Motivation: The range of factors that influence people to behave in certain ways

Job enrichment: Designing a job to give interesting and challenging tasks

Fringe benefits: The ‘extras’ that employees may receive in addition to their pay, for example, a company

car

Piecework: A method of payment under which employees are paid according to the quantity of products

they produce

The National Living Wage: An hourly rate of pay which is set by the government; all employees above a

certain age must receive at least this rate of pay

4.4 Training

Training: A range of activities giving employees job-related skills and knowledge

On-the-job training: Given in the workplace

AQA GCSE BUSINESS STUDIES, Schemes and Mind Maps of Business

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Download AQA GCSE BUSINESS STUDIES and more Schemes and Mind Maps Business in PDF only on Docsity!

AQA GCSE BUSINESS STUDIES - KEY WORDS

Unit 1 Business in the Real World

Unit 2: Influences on business

Unit 3: Business Operations

3.1 Production processes

Production (or operations) management: All the activities in managing the transformation process

Production: The process of changing inputs such as labour services into goods and services that can be

sold

Job production: A method of production in which a product is supplied to meet the exact requirements of

a customer

Flow production: When an item moves continuously from one stage of the process to another

Specialisation: When individuals focus on a limited number of tasks

Lean production: An approach to production that aims to minimise waste

Just-in-time (JIT) production: Holds as little stock as possible; items are ordered just in time to be used

Kaizen: ‘Continuous improvement’ – an approach to production that aims to achieve change from a series

of small steps

3.2 The role of procurement

Contract of employment: A legal document stating the hours of work, rates of pay, duties and other

conditions under which a person is employed

Full-time employment: Occurs when someone works a number of hours equal to the normal working

week, normally between 35 and 40 hours

Part-time employment: Takes place when an employee works for fewer than the normal number of

working hours per week

Job share: Exists when two or more employees agree to share the responsibilities of a single job.

Zero hours contract: Allows employers to hire staff without any guaranteed hours of work

4.3 Motivating employees

Motivation: The range of factors that influence people to behave in certain ways

Job enrichment: Designing a job to give interesting and challenging tasks

Fringe benefits: The ‘extras’ that employees may receive in addition to their pay, for example, a company

car

Piecework: A method of payment under which employees are paid according to the quantity of products

they produce

The National Living Wage: An hourly rate of pay which is set by the government; all employees above a

certain age must receive at least this rate of pay

4.4 Training

Training: A range of activities giving employees job-related skills and knowledge

On-the-job training: Given in the workplace

Induction training: The training given to an employee when they first starts a job

Off-the-job training: Provided outside the employee’s place of work

Unit 5: Marketing

5.1 Identifying and understanding customers

Exchange: When someone gives up something in return for something else e.g. a business exchanges a

product for money

Need: Something that needs to be fulfilled for us to survive

Want: What we would like to satisfy our needs

Customer: Someone who buys a product from a business

Consumer: Someone who uses goods and services produced by businesses

5.2 Segmentation

Sales volume: Measures the number of items sold

Sales value: Measures the revenue generated

Segmentation: Occurs when a market is divided into different groups of needs and wants

5.3 The purpose and methods of market research

Market research: The process of gathering, analysing and processing data relevant to marketing decisions

Market segment: A group of similar needs within the overall market

Segmentation: Occurs when a market is divided into different groups of needs and wants

Primary market research: (Also called ‘field research’), which involves gathering information for the first

time, for example using questionnaires to conduct a survey of potential customers

Secondary market research: (Also called ‘desk research’), which involves using data that already exists,

for example, using information in a newspaper or published on a website

5.4 Elements of the marketing mix

Marketing mix: Refers to all the activities influencing whether or not a customer buys a product. The

elements of the mix can be analysed using the four Ps: product, price, place, and promotion

5.5 Using the marketing mix: product and pricing

Product portfolio: The collection of products that a firm produces

Boston matrix: A way of analysing a product’s share and growth in their market

Dog: A product which has a low market share in a low-growth market

Cash cow: A product which has a high market share in a low-growth market

Question mark: A product which has a low market share in a fast-growth market

Star: A product which has a high market share in a fast-growth market

Product life cycle: Shows how the sales of a product may change over time

Unit 6: Finance

6.1 Sources of finance

Inventories: Raw materials that have not yet been used or products that have been made, but not sold;

these are also called stocks

Internal source of finance: Money that is available from within the business, for example, retained profits

from previous years