Business Studies AS level-definition list

Above the line of promotion- A form of promotion undertaken by

business by paying for communication with consumers.
Absenteeism- Measures the rate of workforce absence as a
proportion of the employee total
Advertising- Paid-for communication with consumers to inform and
persuade.
Staff Appraisal- The process of assessing the effectiveness of an
employee judged against the pre-set objectives
Dismissal- being dismissed or sacked from a job due to
incompetence or breach of discipline.
Asset-led marketing- an approach to marketing that bases strategy
on firms strength and assets instead of purely on what the
customer wants.
Autocratic leadership- a style of leadership that keeps all decision
making at the centre of organization.
Acid-test ratio- liquid assets over current liabilities
Batch production- producing a limited number of identical productseach item in the batches passes through one stage of production
before passing onto the next stage.
Below-the-line promotion- promotion that is not directly-paid for
means of communication, but based on short-term incentives to
purchase
Break-even point of production- the level of output which total costs
equals total revenue- neither a profit nor loss is made.
Equation: fixed cost over contribution per unit ( output )
Buffer stocks- the minimum stocks that are held to ensure that
production could still take place should a delay in delivering occur or
should production rates increase.
Business growth- usually measured in terms of sales or value of
output
Start-up capital- capital needed by an entrepreneur to set up a
business

Working capital- the capital needed to pay for raw materials, day-today running costs and credit offered to customers. Eq: current assetcurrent liabilities
Capital expenditure- involves the purchase of assets that are
expected to last for more than one year, such as building and
machinery.
Liquidity- the ability of a firm to pay its short term debts.
Fiscal policy- is concerned with decisions about government
expenditure, tax rates and government borrowing. These operate
largely through governments annual budget decisions.
Flow production- producing items in a continually moving process
Focus group- a group of people are asked about their attitude
towards a product, service, advertisement or new style of
packaging.
Full-cost pricing- setting a price by calculating a unit cost for the
product and then adding a fixed profit margin.
Redundancy- when a job is no longer required, so the employee
doing this job becomes redundancy through no fault of his or her
own.
Induction training- introductory training programme to familiarize
new recruits with the systems used in the business and the layout of
the business size.
Employment contract a legal document that sets out the terms
and conditions governing a workers job.
Just-in-time- this stock-control method aims to avoid holding stocks
by requiring supplies to arrive just as they are needed in production
and completed products re produced to order.
Capital employed- the total value of all long-term finance invested in
the business.
Job description- a detailed list of the key points about the job to be
filled- stating all its key tasks and responsibilities.
Job enlargement- attempting to increase the scope of a job by
broadening or deepening the tasks undertaken

Job enrichment- involves the principle of organizing work so that

employees are encouraged and allowed to use their full abilities
- aims to use the full capabilities of workers by giving
them the opportunity to do more challenging and
fulfilling work
Job redesign- involves the restructuring of a job- usually with
employees involvement and agreement- to make work more
interesting, satisfying and challenging. Example: hairdressers +
beauty therapies
Quality circles they are voluntary groups of workers who meet
regularly to discuss work-related problems and issues
Job rotation- increasing the flexibility of the workforce and the
variety of work they do by switching from one job to another
Hygiene factors- aspects of a workers job that have the potiental to
cause dissatisfaction, such as pay, working conditions, status and
over-supervision by managers.
Motivating factors- aspects of a workers job that can lead to
positive job satisfaction, such as achievement, recognition,
meaningful and interesting work and advancement at work.
Emotional intelligence (EI) the ability of managers to understand
their own emotions, and those of the people they work with, to
achieve better business performance.
Democratic leadership- a leadership style that promotes the active
participation of workers in taking decisions
Economies of scale reductions in a firms unit cost of production
that result from an increase in the scale of operations
Mark-up pricing- adding a fixed mark-up for profit to the unit price of
a product
Target pricing- setting a price that will give a required rate of return
at a certain level of output/sales
Contribution-cost pricing setting prices based on the variable costs
of making a product in order to make a contribution towards fixed
costs and profit
Market research- this is the process of collecting, recording,
analyzing data about the customers, competitors and the market

Market orientation- an outward-looking approach basing product

decisions on customer demand, as established by market research
Product orientation- an inward-looking approach that focuses on
product that can be made or have been made for a long time and
then trying to sell them
Sample- the group of people taking part in market research survey
selected to be representative of the overall target market
Market segment- a sub-group of a whole market in which consumers
have similar characteristics
Market segmentation- identifying different segments within a market
and targeting different products and services to them.
Niche marketing- identifying and exploiting a small segment of a
larger market by developing products to suit it.
Mass marketing- selling the same products to the whole market with
no attempt to target groups within it.
Marketing mix- the four key decisions that must be taken in the
effective marketing of a product
Customer relationship marketing- using marketing activities to
establish successful customer relationships so that existing
customer loyalty can be maintained.
Liquid assets: current assets inventories (stocks) = liquid assets
Motivation- the internal and external factors that stimulate people to
take actions that lead to achieving a goal
Product positioning- the consumer perception of a product or service
as compared to its competitors.
Product life cycle- the pattern of sales recorded by a product from
launch to withdrawal from the market.
Quota sampling- when the population has been stratified and the
interviewer selects an appropriate number of respondents from each
stratum
Random sampling- every member of the target population has an
equal chance of being selected

Cluster sampling- using one or a number of specific groups to draw

samples from and not selecting from the whole population
Systematic sampling- every nth item in the target population is
selected.
Stratified sampling- this draws a sample from a specified sub-group
or segment of the population and uses random sampling to select
an appropriate number from each stratum.
Channel of distribution- this refers to the chain of intermediaries a
product passes through from producer to final consumer
Workforce audit- a check on the skills and qualifications of all
existing workers/managers
Venture capital- risk capital invested in business start-ups or
expanding small businesses that have good profit potiental but do
not find it easy to gain finance from other sources.