Chapter 1 Business Terms:

Profit:

Money left over after all the costs involved in doing business have been deducted from revenue.

Not-For-Profit Organization:

Organizations that provide goods and services without having a profit motive; also called nonprofit organizations. ***Examples: Churches, Museums, Universities, Charities and Catholic Schools.***

Competitive Advantage:

Some aspect of a product or company that makes it more appealing to target customers.

Informational Technology (IT)

Systems that promote communication and information usage through the company or that allow companies to offer new services to their customers.

Market environment:

A company's target customer's, the buying influences that shape the behavior of those customers, and competitors that market similar products to those customers.

Business Model:

A concise description of how a business intends to generate revenue.

Business Mindset:

A view of business that considers the myriad decisions that must be made and the many problems that must be overcome before companies can deliver the products that satisfy customer needs.

Business:

Any profit-seeking organization that provides goods and services designed to satisfy customers' needs.

Barrier to Entry:

Any resource or capability a company must have before it can start competing in a given market. Other barriers to entry include government testing and approval, tightly controlled markets, strict licensing procedures, limited supplies of raw materials, and the need for highly skilled employees. (Capital needed to compete in goods producing industries)

Economic Environment:

The conditions and forces that affect the cost and availability of goods, services, and labor and thereby shape the behavior of buyers and sellers.

Etiquette:

The expected norms of behavior in any particular situation.

Professionalism:

The quality of performing at a high level and conducting oneself with purpose and pride.

Goods-Producing Business:

Companies that create value by making "things," most of which are tangible (digital products such as software are a notable exception). ***Examples: Pop-Tarts, Furniture, and Clothing.*** Goods-producing industries are often called CAPITAL INTENSIVE BUSINESSES, because they require large amounts of money, equipment, land, and other resources to get started and operate.

Service Business:

Companies that create value by performing activities that deliver some benefit to customers such as finance, insurance, transportation, construction, utilities, wholesale and retail trade, banking, entertainment, health care, maintenance and repair and information. ***Examples: Twitter, Jiffy Lube, HBO, and Verizon Wireless*** Service businesses tend to be LABOR INTENSIVE, in that they rely on human resources than on buildings, machinery, and equipment to prosper.

Technological Environment:

Forces resulting from the practical application of science to innovation to products, and processes.

Research and Development (R&D):

Functional area responsible for conceiving and designing new products.

Stakeholders:

Internal and external groups affected by a company's decisions and activities.

Legal and Regulatory Environment:

Laws and regulations at local, state and even international levels.

Operations Management:

Management of the people and processes involved in creating goods and services.

Revenue:

Money a company brings in through the sale of goods and services.

Social Environment:

Trends and forces in society at large.