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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 Test marketing: launching a Stakeholder: someone who
inputs into output that is of product in a limited is affected, in monetary
greater value to consumers geographical area to asses terms of otherwise, by the
e.g. raw materials into consumer reaction to the activities of a business e.g.
finished goods. product and identify consumers, employees,
problems with the product. shareholders, those living
near factories.
Trade-off: the loss of one Retained profit: profits Loan: money lent on
opportunity as a result of made that are kept within condition that it is repaid,
taking another opportunity the business, instead of within a specific date,
e.g. choosing between being distributed among the usually with interest.
business ideas or new owners of the business.
products.
Debenture: a type of Venture capitalist: a Ordinary shares: securities
security issued for finance financier specializing in issued to the public,
by a business to the public, funding new and whereby buyers become
whereby the buyer becomes innovative, but also high part owners of the
a lender to the company, risk, businesses in exchange company, have voting
and is paid a fixed amount for shares in the business, rights when electing
of interest annually over a in the hope that the directors, and are paid
period of time. business will grow over dividends based on profits
time.
Market mapping: Leasing: hiring an asset e.g. Leaseback: selling an asset,
identifying key variables in a a machine from a leasing and immediately leasing it.
product, plotting graphically company for a specific This is used to raise finance
how competing products time, in exchange for for the business, while
are located in terms of paying rental charges. It is retaining use, but not
combining two variables, an alternative to buying the ownership, of the asset.
and identifying potential asset.
gaps.
Trade credit: credit given by Limited liability: being liable Cost based pricing: pricing
one company (e.g. a for business debts only to a product based on how
supplier) to another (e.g. a the extent of the amount much it cost to produce it,
buyer). invested in the company. and adding a profit margin.
This arises because the
business is a separate legal
entity.
Psychological pricing: an Penetration pricing: Penetration: the extent to
approach to pricing that charging a low price for a which a product has been
reflects the psychological new product in a market accepted by the total
impacts of pricing, and not with lots of competitors, in possible users, generally
just the economics of the the hope of gaining a expressed as a percentage.
situation e.g. higher prices significant market share.
= higher quality
Price skimming: charging a Fixed costs: costs that do Variable costs: costs that
very high price for a new not change with the level of change with the level of
product to make large output in the short run e.g. output, increasing when
profits, then lowering the rent more output is produced
price when competitors e.g. raw materials, wages
enter the market.
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.