Exploring Business by Karen Collins (Test 1: Chapters 5, 9, 10 Vocab)

Flashcard maker : Lily Taylor
Entrepreneur
Individual who identifies a business opportunity and assumes the risk of creating and running a business to take advantage of it.
Small Business Administration (SBA)
Government agency that helps prospective owners set up the businesses, obtain financing, and manage ongoing operation.
Small Business
According to the SBA, a business that is independently owned and operated, is organized for profit, and is not dominant in its field.
goods-producing sector
All businesses whose primary purpose is to produce tangible goods.
Service-producing sector
All businesses whose primary purpose is to produce service rather than a tangible good.
Business Plan
Formal document describing a proposed business concept, description of the proposed business, industry analysis, mission statement and core values, a management plan, a description of goods or services, a description of production processes, and marketing and financial plans.
Franchise
From a business ownership in which a franchiser (a seller) grants a franchisee (a buyer) the right to use a brand name and to sell its products or services.
Executive summary
Overview emphasizing the key points of a business plan to get the reader excited about the business (it is a hook).
Mission statement
Statement describing an organizations purpose or mission-its reason for existence-and telling stockholders what the organization is committed to doing.
Core Value
Statement of fundamental beliefs describing what is appropriate and important in conducting organizational activities and providing a guide for the behavior of organization members.
Small Business Development Center (SBDC)
SBA program in which centers housed at colleges and other locations provide free training and technical information to current and prospective small business owners.
Service Corps of Retired Executives (SCORE)
SBA program in which a businessperson needing advice is matched with a member of a team of retired executives working as volunteers.
Marketing
Marketing is the activity, set of institutions and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners and society at large.
Marketing concept
Basic philosophy of satisfying customer needs while meeting organizational goals.
Marketing strategy
Plan for selecting a target market and creating, pricing, promoting, and distributing products that satisfy customers.
Target Market
Specific group of customers who should be interested in your product, have access to it, and have the means to buy it.
Consumer Market
Buyers who want a product for personal use
Industrial market
Buyers who want a product for use in making other products.
Market segment
Group of potential customers with common characteristics that influence their buying decisions
Demographic segmentation
Process of dividing the market into groups based on such variables as age and income
Geographic segmentation
Process of dividing a market according to such variables as climate, region and population density
Behavioral segmentation
Process of dividing consumers by behavioral variables, such as attitude toward the product, user status, or usage rate.
Psychographic segmentation
Process of classifying consumers on the basis of individual lifestyles as reflected in peoples interests, activities, attitudes, and values
Marketing mix
Combination of product, price, place, and promotion used to market products
marketing research
Process of collecting and analyzing data that is relevant to a specific market situation
Secondary data
information used in marketing decisions that has already been collected for other purposes.
Primary data
newly collected marketing information that addresses specific questions about the target market
Focus group
Group of individuals brought together for the purpose of asking them questions about a product or marketing strategy
brand
Word, letter, sound or symbol that differentiates a product from similar products on the market.
trademark
Word, symbol, or other mark used to identify and legally protect a product from being copied.
Private branding
Product made by a manufacturer and sold to a retailer who in turn resells it under its own name.
Generic branding
Product with no branding information attached to it except a description of its contents.
manufactuerer branding
Branding strategy in which a manufacturer sells on or more products under its own brand names
brand equity
Value of a bran generated by a favorable consumer experience with a product.
brand loyalty
consumer preference for a particular brand that develops over time based on satisfaction with a company´s products
packaging
Container that holds a product and can influence a consumer´s decision to buy or pass it up.
Labeling
information on the package of a product that identifies the product and provides details of the package contents.
Skimming pricing
Pricing strategy in which a seller generates early profits by starting off charging the highest price that customers will pay.
Penetration pricing
Pricing strategy in which the seller changes a low price on a new product to discourage competition and gain market share
Cost-based pricing
Pricing strategy that bases the selling price of a product on its cost plus a reasonable profit
Demand-based pricing
Pricing strategy that bases the price of product on how much people are willing to pay for it.
Target costing
Pricing strategy that determines how much to invest in a product by figuring out how much customers will pay and subtracting an amount for profit.
Prestige pricing
Practice of setting a price artificially high to foster the impression that it is a product of high quality.
odd-even pricing
Practice of pricing products a few cents (or dollars) under an even number
Distribution
All activities involved in getting the right quantity of a product to the right customer at the right time and at a reasonable cost.
Intermediary
Wholesaler or retailer who helps move products from their original source to the end user
Reailers
Intermediaries who buy goods from producers and sell them to consumers
Wholesalers (distributors)
Intermediaries who buy goods from suppliers and sell them to businesses that will either resell or use them
Profit margin
Amount that a company earns on each unit sold
Physical disctribution
Activities needed to get a product from where it was manufactured to the customer
Storage warehouse
Building used for the temporary storage of goods.
Distribution center
Location where products are received from multiple suppliers, stored temporarily, and then shipped to their final destinations.
Materials handling
Process of physically moving or carrying goods during production, warehousing, and distrubiton
just-in-time production
System for reducing inventories and costs by requiring suppliers to deliver materials just in time to go into the production process
Supply chain
Flow that begins with the purchase of raw materials and ends in the sale of a finished product to an end user
Supply chain management (SCM)
Process of integrating all the activities in the supply chain.
Customer value triad
Three factors that customers consider in determining the value of a product: quality, service, and price.
Value chain
Entire range of activities involved in delivering value to customers
Promotion mix
Various ways to communicate with customers, including advertising, personal selling, sales promotion, and publicity
Advertising
Paid, non personal communication designed to create an awareness of a product or company.
Personal selling
One-on-one communication with customers or potential customers
Sales promotion
Sales approach in which a company provides an incentive for potential customers to buy something
Publicity
Form of promotion that focuses on getting a company or product mentioned in a newspaper, on TV, or in some other news media
Public relations
Communication activities undertaken by companies to garner favorable publicity for themselves and their products
Customer relationship management
Strategy for retaining customers by gathering information about them, understanding them, and treating them well.
Permission marketing
Form of marketing in which companies ask customers or potential customers for permission to contact them or send them marketing materials.
Mass marketing
the practice of sending out messages to vast audience of anonymous people.
Interruption marketing
Marketing the interrupts people to get their attention (TV, Radio, Movies)
Social media marketing
The practice of including social media as part of a companys marketing program
Product Life cycle
Four stages that a product foes through over its life: introduction, growth, maturity, and decline
External marketing environment
Factors external to the firm that present threats and opportunities and that require shifts in marketing plans.
Consumer behavior
Decision process that individuals go through when purchasing or using products.
Advertising agency
Marketing consulting firm that develops and executes promotional campaigns for clients
Product
Something that can be marketed to customers because it provided a benefit and satisfies a need,
Industry
Group of businesses that compete with one another to market products that are the same or similar
Market
Group of buyers or potential buyers who share a common need that can be met by a certain product.
niche
Narrowly defined group of potential customers with a fairly specific set of needs
Market Share
Company´s portion of the market that is has targeted.
Breakeven Analysis
method of determining the level of sales at which the company will break even (have no profit or loss).
Fixed costs
Costs that don´t change when the amount of goods sold changes
Variable costs
Costs that vary, in total, as the quantity of goods sold changes but stay constant on a per-unit basis
Contribution margin per unit
Excess of revenue per unit over variable cost per unit
Breakeven point in units
Number of sales units at which net income is zero
Project team
Individuals from different functional areas assigned to work together throughout the product development process.
Product development process
Series of activities by which a product idea is transformed into a final product.
Product concept
Description of what a new product will look like and how it will work
Prototype
Physical model of a new product
Ramp-up stage
Stage in the product development process during which employees are trained in necessary production processes and new products are tested
Patent
Grant of the exclusive right to produce or sell a product, process, or invention

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