Report a Concern

Business Vocab

Unit 1: Business Activity

Aims and objectives

Are the things that a business is trying to achieve, such as grow larger, or make more profit

Backwards vertical growth

When a business merges with, or takes over a business that supplies it with goods or services

Business objectives

What the business aims to achieve, and include survival, profit, growth and providing a service

Business plans

A simple plan which sets out details on the products or service being sold, where the finance is to come from to start the business, how the product or service is to be marketed, and the market research to show there is a need for what is being sold


Money raised to start or develop a business

Deed of partnership

A document setting out the operations of the partnership, including amount of capital to be invested and how profits will be shared


When a business merges with or takes over another business with which there is no connection


The money paid to a shareholder from the profits of a limited company. This is the reward for the shareholder taking a risk by investing money in the company


A person who takes the risk of starting and running a business enterprise

Enterprising characteristics

The features of an entrepreneur, which include being determined, creative and having the ability to take risks

External growth

Growth of a business by takeover or merger

External stakeholders

The local community, suppliers, customers and government


A business word used instead of money. The finance needed to start a business is the money needed to do so

Forwards vertical growth

When a business merges with, or takes over a business that it supplies good or services to


Where a business becomes larger, for example by making more products or opening more places where goods and services are sold

Horizontal growth

A merger or takeover where two businesses are involved in a similar operation, e.g. two electrical producers or two shops selling fashion clothing

Internal stakeholders

The business owners and people who work in the business

Limited liability

Where the responsibility for the debts of a business is limited to the amount invested by a shareholder. A feature of private and public limited companies

Limited liability partnerships

Part partnership, part limited company. Owners are members, not partners. They have limited liability and have to make their finances available to the public


Where a business sells its goods and services

Market share

The share of the total market for a product or service and is shown as a percentage


Where two or more businesses agree to join together


A term used to explain how a business works

Organic growth

Growth of a business internally by increasing sales. Sales can be increased in a number of different ways


A business owned by between two and twenty partners

Private limited company

A smaller business owned by at least two shareholders. Shares cannot be sold to the general public. Has Ltd after its name


The difference between revenue and costs

Providing a service

Where a business makes sure that the needs of the customers are being met

Public limited company

A large business where shares can be sold to the general public enabling vast sums of money to be raised to develop the company. Has plc after its name


The things a business sells needs to make it work, including finance, staff and materials


Making just enough profit to provide the business owner with a decent living. More common in smaller businesses


Are the owners of a private or public limited company

Sleeping partner

A partner who invests in a partnership but has no part in the running of the business

Sole trader

A business owned by one person

Spotting an opportunity

The ability to see the need for a particular product or service that customers need


Groups or individuals who have an interest in business

Stakeholder group

Owners, employees, customers, suppliers, government, local community


For a business, can take many forms, including making profit, surviving and providing a good service to customers


When a business just manages to keep going


Where a business takes a controlling interest in another business

Unlimited liability

Where the responsibility for all the debts of a business rests with the owners of the business. A feature of sole traders and partnerships

Unit 2 – Marketing

Advertising Campaign

A series of advertisements, often using different advertising media

Advertising Media

The methods by which a business can advertise a product. Includes newspapers, TV and radio

Census Data

Data collected by the Government every 10 years, questioning the entire population on their income, occupation etc.

Competitor Pricing

When a price is set based on prices charged by competitor businesses for a similar product

Cost-Plus Pricing

A pricing method that adds a percentage of profit to the total costs of making a product. This gives the selling price.


When sales are falling as the product or service is seen by customers as being old and they switch to newer products and services


An important element in a number of different products, especially where style and technology work together

Digital Distribution

The distribution of goods and services digitally by downloading from a website

Focus Groups

Selected small groups of customers who give their opinion on products


When sales are growing strongly as the new product or service becomes known


The improvement on an original idea, which will often involve using new processes. It is closely linked to design, where new ideas can be used in a product due to changes in design

Internal Data

Data already within a business based on past performance


A question sheet filled in by the person conducting the interview


When a product or service is first on sale


The introduction of a totally new product or feature


Finding the needs of consumers and demonstrating how a business fulfils those needs in a way that increases sales

Market Data

Information that help marketing decisions. It includes data on such things as market shares, changes in demand and the effect of promotions

Market Research

The collection of data on consumer habits to help decision-making in marketing

Market Segmentation

Splitting the market for a product into different parts, or segments

Market Share

The percentage of total sales of a product that a business has made. If a business sells 20,000 products and the total market for that product is 50,000, then the business has a market share of 40%


When sales are at their highest level

P’s of Marketing Mix

Price, Product, Promotion and Place

Penetration Pricing

When a price is set lower than the competitor businesses. Often used by new businesses to break into a market. This should only be seen as a short-term strategy

Physical Distribution

The distribution of goods using a physical presence such as a shop or office

Point of Sale Promotions

Includes price reductions, loss leaders, competitions and free samples

Primary Research

Data collected first-hand, often in the form of surveys. Sometimes referred to as field research

Product Life Cycle

The life of a product, usually shown as a graph divided up into four stages: introduction; growth; maturity; and decline

Promotional Pricing

Where prices are reduced to give products a boost or to sell off old stock. Most commonly seen as sales in shops

Qualitative Data

Data based on opinions of those being asked

Quantitative Data

Data collected that is based on facts or numbers, usually easier to analyse than qualitative data


A question sheet filled in by the consumer

Research and Development

Used to help introduce both new and existing products. The research may be testing products in a laboratory or conducting market research by interviewing customers

Secondary Research

The collection of data using research or information provided by others, such as magazines, journals and the internet. Often called desk research


Where a new product is more advanced than that of competitors; a price is set high as some customers are willing to pay higher prices to own the newest technology.

Target Market

The group of customers to whom a business aims to sell its products. The target market may be other businesses as well as consumers


Used to test whether customers will buy a product

Unit 3 – Definitions of People

Application Form

A form which asks applicants for personal details, experience and skills


A long-term development programme for workers to learn job skills while they work through a mixture of on-and-off-the-job training and study. Apprenticeships lead to some kind of vocational qualification


The power that one person has to make decisions and to control what other workers do


The responsibility that a person has for a job meaning that they will take the blame for what goes wrong as well as the credit for what goes well

Award Scheme

A presentation of some kind to recognise somebody’s effort


An additional payment to workers for achieving a target

Chain of Command

The links in the levels of authority from those at the top with the most authority to those at the bottom with the least


The transmission of a message

Contract of Employment

A legal agreement between an employer and an employee

Customer Service

The service given to customers, including service at the time of sale and after the sale


A document in which the applicant outlines their personal details, experiences and skills


The process of giving a manager authority to a subordinate to make decisions for which that manager is responsible


Long term and is focused on the worker to help to realise their longer-term potential

Digital Communication

The exchange of information electronically


When one worker is treated differently from another for no acceptable reason. There are several unacceptable reasons for different treatment

Employment Agency

An agency that has workers readily available for business hire, usually for a short period of time

Employment Law

Designed to protect workers from employers who may treat them unfairly

Employment Tribunal

A panel that hears cases where employment laws may have been broken and which comes to a decision either in favour of the employer or employee

External Communication

Communication between people in an organisation and others outside that organisation

External Methods of Recruitment

Include websites, newspapers, social media and specialist magazines

External Recruitment

When a job vacancy is filled by employing someone from outside the business


The response made by a person who receives a communication

Flexible Working

The practice of people working partly at their place of work and partly elsewhere, perhaps at home or while they are mobile

Formal Communication

Communication that uses the official channels of communication

Fringe Benefits

Additional benefits that workers receive on top of their pay. They include pensions, childcare vouchers, subsidised canteen meals

Full-Time Working

When a person works 35 hours or more per week


Different types of work that need to be done in business including production, finance and marketing

Group Activities

Usually designed to test how well an applicant works with others

Holiday Entitlement

The amount of paid holiday that a worker can have in a year

Horizontal Communication

Communication between people on the same level of the hierarchy in an organisation

Human Resources

The workers employed by a business

Human Resources Plan

A plan detailing workers a business needs – how many, whether they will be full time or part time, the skills they should have and when they will work

Identifying Human Resource Needs

The activity of thinking about the purposes of human resources, and how many and what types of workers will be needed

Induction Training

Training to introduce a new worker to the business, place of work and their fellow workers as well as their jobs

Informal Communication

Communication that is outside the official channels of communication

Internal Communication

Communication between people employed in the same organisation

Internal Methods of Recruitment

Includes notice boards, word of mouth, company website and emails to staff

Internal Recruitment

When a job vacancy is filled by employing someone who is already an employee of the business


Sessions in which the people making the appointment asks questions of the applicants

Job Description

Lists the main duties, tasks and responsibilities of a worker


The number of levels of authority that there are in a chain of command

Letter of Application

A letter written by the applicant usually explaining why they think they are suitable for the job


How workers are encouraged to work hard

Off-the-Job Training

Occurs away from the job. It may still be at the same place of work, or the employee may be sent somewhere else for the training

On-the-Job Training

Occurs at the place of work and while the worker is doing their job

Organisation Chart

A diagram that shows how the workers are organised in a business and who is in charge of whom


The money earned by workers as a reward for the work they do

Part-Time Working

When a person works fewer than 35 hours per week

Person Specification

Lists the qualities, qualifications and knowledge that a person should have to do a particular job


A method of motivating a worker by complimenting their work and so making their work recognised and valued


A measure of output per worker. It is the only way of measuring the performance of workers

Professional Development

Includes both vocational and academic development. It involves learning over a long period of time. Workers may learn through external courses with this learning being reinforced by practical activity in the workplace.

Profit Sharing

When workers receive some of the profits made by a business

Recruitment Agency

A specialist agency that carries out all the tasks involved in recruitment and selection of workers on behalf of an organisation


Statements from a previous or current employer or other responsible person about the suitability of the applicant for the job


Rules imposed on businesses by the government


When workers can be kept employed by businesses rather than them leaving to work elsewhere

Retention of Workers

When workers choose to stay in a firm rather than move elsewhere


The process of choosing between applicants for a job


When people work as their own business, selling their work to buyers who may be consumers or other businesses

Skills Gap

When the business recruits skilled workers because it is short of them

Skills Shortage

Refers to a situation in which businesses cannot recruit workers with the skills they need

Social Media

Online applications that allow people to create and share content to participate

Span of Control

The number of subordinates who report directly to the line manager

Statement of Employment Particulars

Part of the employment contract. It gives details of the terms of employment


The workers that a line manager is responsible for

Temporary Working

When a person only works for a short period of time for an employer, sometimes on a short-term contract or sometimes just on a day-to-day basis as needed


Activities completed by applicants which check their skills

The Purpose of Human Resources

The work that must be done by human resources. It is usually broken down into a number of different jobs

Trade Union

An employee organisation that exists to represent the interest of its members


Short term and is focused on helping a worker to do his or her job well

Turnover of Labour

A measure of the number of proportion of a staff who leave a firm each year and need replacing

Verbal Communication

Communication by speaking

Vertical Communication

Communication up or down the hierarchy within an organisation


An online location with several pages that can be contacted by internet users through its address

Working Environment

The quality of the physical workplace and its climate

Working Time Directive

A statement of maximum number of hours that a person can be asked to work

Working While Mobile

When people work when they are on the move, travelling or on holiday

Written Communication

Communication by written words and diagrams

Zero-Hours Contracts

Contracts given to employees which do not guarantee any work. The business will call workers if and when they are needed to ask them to come in to work

Unit 4 – Operations

After-sales service

Advice and help given to a customer after they have bought a product or service

As Described

Means that goods must be as the business described them


A production process involving machinery that is not controlled by a person but usually controlled by a computer

Batch Production

The process of production where one type of product is made and then production is switched to make a different product

Click and Collect

Ordering online and collecting goods from the store at a later time

Consumer Laws

The area of law which protects the customers of a business. This is mainly through the Consumer Rights Act of 2015

Customer Engagement

The contact between the business and the customer

Customer Service

The name given to an area of business that deals with customer enquiries


The bringing together of buying and selling electronically

Face to Face Selling

Usually completed in a shop where there is direct contact between buyer and seller

Fit for Purpose

Means that goods must do what they are meant to do

Flow Production

Production of one product that takes place continuously using a production or assembly line. This is sometimes called mass production

Job Production

The process of production where products are made individually


A factor of production. It is the labour employed by businesses to produce goods and services


The place where a business is sited


The management of the transportation and storage of goods


The management of purchasing within a business

Product Knowledge

The detailed knowledge of a product or service that staff within a business use to help persuade a customer to buy

Product Processes

The three methods or processes of production – job, batch and flow


Means ‘nearness to’. It can refer to proximity to the market, to raw materials and to labour supplies


About a product being fit for purpose

Quality Assurance

An approach that involves the whole business focusing on quality, thus aiming to prevent quality problems arising

Quality Control

A system for inspecting the quality of the goods or services produced and that they are of a good standard

Raw Materials

Materials that are processed in some way as part of the manufacture of a product


When a fault occurs with a product and the business asks for the product to be brought back so it can be repaired or replaced


Goods which customers take back to the shop because there are problems with the quality of them


What customers say and feel about a business. Damage to a reputation can seriously affect a business


The use of robots in the process of productions

Satisfactory Quality of Goods

How the goods are made will reflect the price. A high-priced product must be of high quality


Parties who supply goods and/or services to a business


Sales completed over the telephone

Transport Infrastructure

The provision of roads, railways, ports and airports in an area for transporting goods and people

Unit 5 – Finance Definitions

Average Rate of Return (ARR)

A method of measuring and comparing the profitability of an investment over the life of the investment

Break-Even Forecast

A prediction about the break-even quantity based on estimates of future sales revenues and costs

Break-Even Quantity

The amount a business must sell to earn enough revenue to just cover its costs so that it does not make a profit nor a loss


Not simply notes and coins held in the business, but also money in a bank account

Cash Flow Forecast

A statement showing the expected flow of money into and out of a business over a period of time

Closing Balance

The amount of cash left at the end of the month. This becomes the opening balance at the start of the next month


Money raised through an appeal to the public


Money that the business pays out


The costs of operating a business

Finance Function

Sometimes referred to as the finance department. Only found in larger businesses

Financial Information

Includes details of profit, loss, cash flow, break-even, profit margin and average rate of return. These can be used in helping business decision-making

Fixed Costs

The costs that stay the same as output changes, for example, rent

Gross Profit

Sales minus the cost of sales

Gross Profit Margin

Gross profit divided by sales multiplied by 100


The amount of money that has to be paid on borrowed money


Money that the business receives


The ability of a business to pay its short-term debts which must be paid in the near future


The sums borrowed for a certain period at an agreed rate of interest


Occurs in a business when costs are greater than revenue

Margin of Safety

The amount by which a business’ actual output is greater than its break-even output

Negative Cash Flow

When during one month, more cash is flowing out of the business than flowing in

Net Cash Flow

The total inflow minus total outflow

Net Profit

Gross profit minus the expenses of operating the business

Net Profit Margin

Net profit divided by sales multiplied by 100

Opening Balance

The amount of cash available at the beginning of the month that was the closing balance at the end of the previous month


An arrangement with a bank that a business can spend more money than it has in its account

Owners’ Capital

Money from savings put in to the business by the owner

Positive Cash Flow

When, during one month, more cash flow is flowing into the business than is flowing out of it.


The revenue received by a business minus the costs of running the business

Profitability Ratios

Calculations such as gross profit margin and net profit margin which help to interpret data

Retained Profit

Profit that is not distributed to shareholders as dividend


The money from sales

Sale of Assets

Items sold by the business


Something of value that is offered to a lender as a form of guarantee of payment

Share Issue

Money raised from investors by selling new shares

Short-Term Debts

The bills that a business has to pay in the near future, for example electricity or rent

Taking on a Partner

Adding a new partner who contributes some new capital

Time Period

The length of time for which the finance is required

Total Costs

The addition of fixed and variable costs

Total Inflow

The total amount of cash flowing into a business

Total Outflow

The total amount of cash flowing out of a business

Trade Credit

When the business has the goods to sell and agrees to pay at some time later

Variable Costs

The costs that change as output changes, for example, wages

Unit 6 – Influence on Business


Money or assets such as machines, buildings, vehicles

Child Labour

The use of young children, below the legal age for employment, in order to achieve low-cost production

Climate Change

The process is when average temperatures rise or fall and patterns of weather change

Consumer Income

The total amount of income that all customers in the country receive and which they have available to spend


Buyers who buy goods and services for the satisfaction or benefit they will get from them. Customers largely buy from retailers

Distribution of Income

Refers to how the income is shared out amongst different people in the community.

Economic Climate

Refers to how well the country is doing in terms of the levels of income and employment

Economic Growth

A period when GDP is rising, causing income and employment to rise

Environmentally Friendly

An adjective that describes consumers and businesses that act to make production sustainable

Ethical Business

Businesses that behave in a morally correct way

Ethical Marketing

Marketing activities that seek to give customers information to make good choices for themselves


What is right and what is wrong

Free Trade

The absence of restrictions on trade between countries


The process by which business activity around the world has become increasingly interconnected

Global Warming

The rise in average temperatures that scientists say is taking place

Gross Domestic Product (GDP)

A measure of how much a country produces in a year. It influences the level of income and employment


The amount of money that people receive from work and from assets they own, such as shares and property

International Branding

Creating an image or values for a product that are communicated in countries around the world

International Economic Climate

Refers to what is happening to income and employment in different parts of the world

Level of Employment

The number of people in work in a country

Level of Income

The average income of people in a country

Level of Unemployment

The number of people out of work in a country

Multinational Companies

Businesses that operate in different countries around the world

Non-Renewable Resources

Resources that can only be used once, such as oil


Causing harm to the environment including air, land and water


A measure of the output of each worker on average


A limit in terms of weight or value on the amount of a good or service that can be imported


A period when GDP is falling, causing income and employment to fall


When resources are reused produce something


Rules about the goods and services that can be sold in a country

Renewable Resources

Resources that can be used more than once, such as wind or water power, or that can be recreated such as crops

Sustainable Production

When production does not lead to the depletion of natural resources


A tax on goods or services that is imported


The import and export of goods and services

Unit Cost

The cost per unit produced. The greater the productivity of workers, the lower the unit cost of production

Waste Disposal

The process of getting rid of unwanted materials

Art Vocab

Business Vocab

Child Development Vocab

Computing KS3 Vocab

Computing KS4 Vocab

Dance KS3 Vocab

Dance KS4 Vocab

Design Technology KS3 Vocab

Design Technology KS4 Vocab

Drama KS3 Vocab

Drama KS4 Vocab

Economics Vocab

English KS3 Vocab

English KS4 Vocab

Ethics Vocab

Food and Nutrition KS3 Vocab

Food and nutrition KS4 Vocab

Geography Vocab

History KS3 Vocab

History KS4 Vocab

Maths Vocab

Music KS3 Vocab

Music KS4 Vocab

Philosophy Vocab

Psychology Vocab

Science KS3 Vocab

Science KS4 Vocab

Sociology Vocab