Important Business Terms PDF

**IMPORTANT TERMS/WORDS TO STUDY:** **Importance of Initial public offering (IPO) in a business** - An IPO is the perfect opportunity for wealth creation for these key stakeholders who have toiled away, working hard to make the company a success. - Going public gives the company a sho...

**IMPORTANT TERMS/WORDS TO STUDY:** **Importance of Initial public offering (IPO) in a business** - An IPO is the perfect opportunity for wealth creation for these key stakeholders who have toiled away, working hard to make the company a success. - Going public gives the company a shot at branding, as IPOs are extensively covered by the media. - For any company, raising capital for its ventures is of paramount importance. One can even go as far as to say that money is the lifeblood of any business/organization. The best advantage of IPO is to Improve Public Image. **Importance of marketing in an enterprise** - Good marketing attracts new customers and keeps existing ones coming back. - Marketing allows a business to quickly respond to changes in customer preferences or market conditions. - Marketing helps define what your brand stands for, making it recognizable and unique compared to others. **Capital** - the financial resources and assets that a business uses to fund its operations and growth. **Fixed Capital** -- type of capital that comprises long-term investments that a business uses to produce goods or services over time. **Equity Capital** -- is an enticing, yet challenging, source of funds/capital to pursue. This is when you invite people on companies to invest in your business, but instead of repaying the money. You agree to give up a certain percentage of ownership. In arranging your capital for a business, you need to analyze and find-out the amount and the duration of finance required as well as the duration for such finance is needed in the business. **Angel investor** - High-net-worth individuals that provide funding in exchange for equity in the company. **Marketing** - includes advertising and allows businesses to sell products and services to consumers, other businesses, and organizations. **Marketing management** - involves developing and implementing strategic marketing programs, processes, and activities that align with wider business objectives. Marketing in an enterprise helps define what your brand stands for, making it recognizable and unique compared to others. **Business Plan** - a formal document that outlines a company\'s objectives, strategies and financial forecasts, serving as a comprehensive roadmap for business growth and development. **Executive summary** - indicates the introductory overview of the business. **Retained earnings** - an internal source of funds. **Balance sheet** - provides a snapshot of a company's financial position at a specific point in time. **Activity of a Marketing Management** - Coordinating teams where overlap for marketing activities is present - Setting goals and objectives for the marketing department - Managing annual budgets and staff resources **1980s-1990s Corporate Social Responsibility (CSR) Expansion** - The period in which corporations increasingly recognized the importance of ethical standards and social responsibility, with some companies beginning to publish annual social responsibility reports. **Purposes of business plan** 1. To outline financial projections and goals. 2. Show the future financial performance of the company and its economic situation for the owners and investors. 3. Help identify risk that may affect the growth of the company and its economic situation for the owners and investors. 4. Help make predictions about market trends, competitor behavior, customer requirements and define and prioritize key business objectives. **Recommended guideline for starting a business** - Conducting thorough market research - Developing a detailed business plan - Identifying a clear target audience The first step in starting a business is to conduct market research. Accounting equation Assets = Liabilities + Equity **Corporate social responsibility (CSR)** -- emphasizes contributing positively to society and the environment. A business donating a portion of its profits to charity is 1 example of CSR. **Social responsibility** important for businesses because it build trust and goodwill among stakeholders. **Right to Safety** - The right of consumers to expect that the products and services they purchase will be safe and free from harmful defects. **21st Century** - The contemporary era, where social responsibility is viewed as a critical part of corporate strategy, and companies are expected to address social, environmental, and ethical issues actively and transparently. **Early 20th Century** - The time period in which businesses started to face growing pressure from society to consider ethical practices, environmental concerns, and fair treatment of workers. **CHARACTERISTICS OF GOOD BUDGETING** - -careful planning - -Practicality - -Flexibility - -Accessibility **Getting Started in Business** - Business structure selection - Business model development - Goal setting - Financial projection - Licensing and permits - Pricing strategy - Marketing plan - Customer service plan - Risk management **Theories of Social Responsibility** - Philanthropic Responsibilities - Ethical Responsibilities - Be ethical - Legal Responsibilities **Production planning** - A systematic process of defining what a company will produce, how it will produce it, and when production will occur. **Resource allocation** - The process of determining the resources, time, and labor needed to produce goods efficiently. **Market research** - The stage that includes analyzing the market, industry trends, and target customers to understand the business environment. **Strategic planning** - The section of the business plan where specific objectives and strategies for achieving them are outlined. **Organizational structure** - The stage of the business plan that describes the business structure, management team, and operational workflow. **The Industrial Revolution** - The era when business was primarily focused on maximizing profits with little concern for the impact on society, and the role of government was limited.