This means to increase the difference between the cost of inputs and the price people are prepared to pay for the product.

Assets

Assets are all the business's possessions

Balance Sheet

Balance sheet shows where the money comes from to finance the business and how it is being used.

Barter

Barter is a direct swap of products or services where no money changes hands.

Batch Production

Batch production is used to make things in groups like firing pots in a kiln.

Business plan

A report that explains how a new business will market its product, what it will cost to produce, how much money it will expect to make and how much it needs to start the business.

Business Angel

Business angels invest in small businesses. This helps the business and makes money for the angel.

Business Plan

A business that wants to raise money to develop will produce a plan to show that their schemes will work. It explains how production, finance, human resources and marketing contribute to the plans.

Business culture

A businesses culture is the collection of attitudes of the people who work there.

It may be positive, which is helpful to the business but it can also be negative.

Cell production

A management method that puts employees into teams.

Each team takes responsibility for its area of production and can organise itself to achieve greatest efficiency.

There are often incentives to encourage them to produce as much as possible, while ensuring that quality is high.

Commission

This is used to encourage sales staff to work hard. It is a payment made according to the level of sales.

Company

A company is a registered business owned by shareholders. A public limited company sells shares to the public. The shareholders in a private limited company can decide who can own the shares.

Competition

Competition comes from businesses that are selling similar products or services to the same customers.

Competition Commission

Competition Commission investigates businesses which use their power to raise prices or reduce consumer choice.

Competitive pricing

Competitive pricing sets a price at a level similar to similar products.

Continuous improvement

Continuous improvement means that training becomes a regular part of working life. People need to learn new ways to produce the product and work within the organisation.

Corporate responsibility

Corporate or social responsibility is the duty that a business shows to some or all of its stakeholders.

Costs

Costs come in all shapes and sizes. Start-up costs cover everything that has to be paid for before any sales are made. Running costs cover everything that must be paid for to keep production going. There are more to come.

Cost plus pricing

Cost plus pricing adds a percentage to the cost of production to decide the price.

Differentials

The difference between levels of pay within and between occupations. More skills, training or responsibility often lead to higher pay.

Dividends

Dividends are the share of annual profits paid to shareholders.

Euro

The euro is the common currency of some members of the European Union.

Eurozone

The eurozone is made up of the countries which have decided to convert to the new euro currency.

Flow production

Flow production involves making things in a continually moving process like paper for printing.

Fringe benefits

These are rewards other than pay. They might include pensions, holiday time or a car. They are often given to reward loyalty.

Gap analysis

Gap analysis involves comparing a business's product range with its competitors to see if it is missing any opportunities.

Gross Profit

Gross profit is calculated by subtracting cost of sales from turnover.

Human resources

Human Resources are the people who work for a business.

Incentives

Incentives are paid or given in the form of holidays, meals etc. to encourage people to work hard.

Job enrichment

Job enrichment means making the job more rewarding. Training can help because it often means that people take on more responsibility.

Job production

Job production is used when products need individual attention like a tailor made suit.

Level playing field

Level playing field refers to a situation in which competition between companies is fair.

Liabilities

Liabilities are all the businesses' debts.

Location

Location for a business is where its premises, a factory, shop or office, are based.

Manufacturer

Manufacturers use resources to make a product.

Management buyout

A management buyout is when a business is bought by the people who are running it.

Marketing

Marketing consists of all the processes involved in making sure that a product is just what people want to buy.

Marketing mix

The marketing mix combines product, price, promotion and place (distribution) in a way that should help a business to sell its products.

Market share

The proportion of the market held by a product or a business.

Markets

Markets bring buyers and sellers together. They may meet each other or trade at a distance, on the Internet or by mail order for example.

Market research

Market research is used to find out what customers want and what competitors are doing.

Motivate

If you motivate someone you are helping them to be keen and committed in carrying out their job.

Multi-skilled

Multi-skilled staff are trained to carry out a range of different processes.

This makes production flexible as people can move from one part of the production process to another very easily.

Net Profit

Net profit is gross profit minus any interest that is paid by the business or one off charges like shutting down a shop.

On-the-job training

On-the-job training takes place in the working environment. It may mean watching someone else or practicing a skill while someone gives you feedback.

Off-the-job-training

Off-the-job training usually takes place in a training room with a trainer who teaches new skills or gives information.

Office of Fair Trading

The Office of Fair Trading is the government body which ensures that businesses act in line with competition law.

Operating profit

Operating profit is calculated by subtracting overheads from gross profit.

Organic growth

Organic growth comes from growth within the business. It might come from increasing sales or doing things more efficiently. Inorganic growth comes from buying other businesses.

Partnership

A partnership is an agreement between two or more people to take joint responsibility for running a business. They share both the profits and the risks.

Penetration pricing

Penetration pricing sets a price lower than similar production in order to attract customers and break into the market.

Performance related pay

This means people are paid more if they do well.

Place

Place refers to the ways in which a product is distributed. It might be through shops, the Internet, mail order etc.

Price

The price is the amount that is charged for a product. It must be set at a level that people are prepared to pay.

Price skimming

Price skimming is setting a high price for a new product because you expect people will be willing to pay more for a new product.

Primary research

Gathering information from first hand sources such as interviews, questionnaires and focus groups.

Product

Products are things you buy or sell. The word is often used to mean both actual items and services.

Productivity

Productivity measures the value of the products of a business in terms of the inputs used to make them.

Product life cycle

The phases of growth and decline that a product goes through from its introduction to the end of its life.

Profit

Profit is the difference between money earned from sales and the costs of making the product.

Profit after tax

Profit after tax is net profit minus the company's tax payment.

Profit and loss account

Profit and loss account shows all the revenue or turnover and all the expenditure. When one is taken from the other, you have either a profit or a loss.

Promotion

Promotion involves any kind of advertising or incentive that encourages customers to buy a product.

Rationalisation

Reorganising a business, usually involving reducing the workforce, in order to produce more efficiency and therefore cut costs.

Resources

Resources are things that you need to make a product or provide a service. They include people, buildings, equipment and materials.

Retained profits

Retained profit is what is left when the business has paid the shareholders their dividend. Turnover is the money earned from sales.

Safe

All products and services must be safe to use. Health and Safety laws guide producers on what this means for their products.

Secondary research

Information which is already available from other people's research.

Service

A service is a product provided by people. E.g. hairdressers, estate agents, solicitors and teachers.

Sole trader

Sole traders run their own businesses. They either work on their own or employ other people

Suppliers

Suppliers are businesses that supply other businesses with materials.

Workforce

A workforce is the number and range of people available for work in an area.