Business Life Cycle
business plan
A document a business should produce to give it purpose and direction over the long term
debtor
A person or business who owes money
undercapitalisation
A reason for business failure. When a business starts and it does does not have sufficient funds to pay their expenses or operate the business
poor record keeping
A reason for business failure. When the management of a business do not know the financial situation as they have not kept recorded all the business' transactions.
inflation
An increase in the general level of prices
creditor
An individual or business which is owed money by a business
proprietor
An owner of a business
renewal
In post maturity, business sales begin to rise again as the products are modified to attract customers
decline
In post maturity, the sales fall as the business' products are no longer in demand by consumer.
debt
Money owed by a business to creditors
profit
Revenue minus expenses
cessation
The closure of the business
establishment
The first stage of the life cycle. The business starts and sales are low.
post maturity
The fourth stage of the business life cycle.
market share
The percentage value of a business' sales as a proportion of total market sales
growth
The second stage of the business life cycle. Sales increase at a rapid rate
maturity
The third stage of the business life cycle. Sales level off.
sales
The value of goods sold by the business
loss
When revenues are less than expenses
breakeven
the total revenue is equal to the total costs