Business Case Study: Key terms and definitions

Private limited company (line 1) - Is a type of privately held small business entity owned by
shareholders who are often members of the same family. It limits the number of shareholders to
50 and requires permission of all shareholders while selling.

Word of mouth promotion (line 6) - An unpaid form of promotion that is generated by person to
person communication in which satisfied customers tell other people how much they like a
business/product/service.

Viral marketing (line 7) - The use of social media sites or text messages to increase brand
awareness or sell products.

Business plan - a written document that describes a business, its objectives and its strategies, the
market it is in and its financial forecasts.

Paternalistic approach (line 21) - A type of fatherly leadership style used by dominant males where
their power is used to control and protect subordinate employees who are expected to be loyal
and obedient.

Operations (line 37) - Refers to the administration of business practices that combine factors of
productions to provide output at a high efficiency.

Local craftsmanship (line 11) - A worker who practices with his local expertise who trades,creates
and performs with skill or dexterity. Usually in a specified local area.

External stakeholders (line 12) - People or groups of people who are not a part of the organisation
but can be affected by, or impact, and therefore have an interest in business decisions.

Just in time (line 14) - Stock control method aims to avoid holding stock by requiring supplies when
they are needed in production and completed products are produced to order. It allows high
quality, flexible production while minimising manufacturing waste and stock levels.

Ethically produced inferred as “Ethics” (line 17) - Moral guidelines that determine decision making

Leadership (line 21) - The art of motivating a group of people towards achieving a common
objective

Sole trader (line 23) - One person owns and controls the business and keeps all the profits.

Product oriented (line 23) - An inward looking approach focussing on making products that can be
made and have been made for a long time.
Distribution channels (line 73) - The chain of intermediaries a product passes through from
producer to final customer

Product development (line 38) - Product development involves modifications of an existing product
or its presentation or formulation of an entirely new product that satisfies newly defined
customers demands or a market niche.

Human resource manager (line 40) - Responsible for certain objectives, organising resources and
motivating staff to help the business gain a competitive advantage.

Brand loyalty (line 43) - The faithfulness of consumers to a particular brand as shown by repeat
purchases irrespective of marketing pressure from competing brands.

Crisis management plan (line 50) - Outline laid which holds the steps taken by an organisation to
limit the damage from a significant damaging event by handling, containing and resolving it.

Internal sources of finance (line 52) - Raised from the business’s own assets or retained profits

Contingency planning (line 50) - Preparing the immediate steps to be taken by an organisation in
the event of a crisis or emergency.

Internal growth (line 51) - The development of companies by growing its existing business with its
own finances as opposed to acquiring other businesses.

Marketing (line 37) - The management task that links business to customer by identifying and
meeting the needs of customers profitably (right product, person, place, time)

Entrepreneur (line 1) - Is a risk taker who combines all the factors of production to satisfy a need or
a want of customers.

Retailers (line 36) - A business or person that breaks the bulk of the distribution channel and sells
goods to the consumer in small quantities (last link).

Financial Loss (line 49) - Damage suffered by a person such as can be seen only on a balance
sheet rather than as physical injury to the person or destruction of property.

Investors (line 53) - A person or organization that puts money into financial schemes, property, etc.
with the expectation of achieving a profit.

Vision (line 53) - An aspirational description of what an organisation would like to achieve in the
mid-term or long-term future. It serves as a clear guide for choosing current and future courses
of action.
Social responsibility (line 58) - The obligation of an organisation’s management towards welfare and
interests of society in which it operates.

Long term viability (line 56) - Long-term survival, and its ability to have sustainable profits over a
period of time.

Fixed costs (line 62) - Periodic costs that do not vary with output in the short run irrespective of the
output level or sales revenue.

Gross profit margin (line 61) - Measure of a company’s profitability that is expressed a percentage
of sales revenue.

Gross profit (line 61) - Sales revenue less the cost of sales.

Capital expenditure (line 64) - An amount spent to acquire or upgrade productive assets to increase
the capacity or efficiency of a company for more than one accounting period. Usually, the
amount of money spent on fixed assets and increase in capital expenditure is viewed increase
in investment.

Expansion (line 67) - When the economy moves from a trough to a peak. It is a period when the
level of business activity surges and gross domestic product (GDP) expands until it reaches a
peak. A period of expansion is also known as an economic recovery.

Stratified sampling (line 68) - The process of dividing a population into the smaller subsets for
sampling purposes.

Strategic alliance (line 74) - Agreements between firms in which each agrees to commit resources
to achieve an agreed set of objectives.

Organisational Charts (line 80) - A graphic representation of how authority and responsibility is
distributed within an organisation.

Manager (line 40) - Responsible for certain objectives, organising resources and motivating staff to
help the business gain a competitive advantage

Revenue streams (line 55) - The income an organisation gets from a particular activity. Each activity
therefore potentially provides a new revenue stream.

Delegation (inferred from line 31) - Passing authority down the organizational hierarchy

Joint venture (line 74) - Two or more businesses agree to work closely together of a project and
create a separate business division to do so.
Franchising (line 75) - A form of business organization in which a firm which already has a
successful product or service (the franchisor) enter into a continuing contractual relationship
with other businesses (franchisees) operating under the franchisor’s trade name and usually
with the franchisor’s guidance, in exchange for a fee

Organisational structure (line 78) - Determines how the roles, power and responsibilities are
assigned, controlled, and coordinated, and how information flows between the different levels of
management a.k.a. skeletal structure of organisation

Location (line 19) - Named geographical place (such as an airport, seaport, container freight station
or terminal) that provides permanent facilities for movement of goods ( such as customs,
storage, and other support services) or is designated for a stated purpose

Stakeholders (line 12) - People who can be affected by and therefore have an interest in any action
by an organization.

Shares (line 1) - A certificate confirming part ownership of a company and entitling the shareholder
to dividends and certain shareholder rights.

Business plan (line 10) - A written document that describes a business, its objectives and its
strategies, the market it’s in and its financial forecasts, time period for review

Brand (line 21) - A type of product manufactured by a company under a name.

Commodity market (line 19) - Trades in primary economic sector rather than manufactured products
(Eg- wheat, coffee)

Multinationals (line 37) - A multinational corporation (MNC) produces in at least one country other
than its home country

Charities (line 35)- Is a type of non-profit organisation(NPO). It differs from other types of NPOs in
that it centers on philanthropic goals as well as social well-being

Customers (line 47) - A party that receives or consumes products and has the ability to choose
between different products and suppliers.

Revenue (line 55) - Income generated from sale of goods or services or any other use of capital or
assets associated with the main operations of an organization before any costs are deducted.

Market research (line 69) - Process of collecting, recording, analysing data about customers,
competitor and market

Profit (line 70) - The positive gain from an investment or business operation after subtracting
expenses.
Distribution channels (line 73) - A distribution channel is a chain of businesses or intermediaries
through which a good or service passes until it reaches the end consumer.

Organisational charts (line 80) - A graphic representation of how authority and responsibility is
distributed within a company or organisation, also called org chart

Business (line 33) - Organisation or enterprising entity engaged in commercial, industrial or

professional activities

Social enterprise (inferred from line 35) - a business with mainly social objectives that reinvests
most of profits into benefiting society rather than maximising profits.

Promotion (line 6) - One of the elements of the marketing mix, that uses advertising, sales
promotion, personal selling etc to inform consumers and persuade them to buy.

Market (line 45) - An actual or nominal places where forces of demand and supply operate, and
where buyers and sellers interact (directly or through intermediaries) to trade goods, services, or
contracts or instruments, for money or barter

Market research (line 68) - Component of marketing research whereby a specific market is
identified and its size and other characteristics are measured along with collecting, recording
and analysing data based on customers and competitors

Culture (line 11) -

Capacity (line 13) - The maximum output that a business can produce in a given period with the
available resources. Capacity is usually measured in production units (e.g. 1,000 cars per
month).

Fair Trade (line 17) - Trade between companies in developed countries and producers in
developing countries in which fair prices are paid to the producers.

Ethically produced (line 17) -

Full potential (line 44) - The estimated maximum total sales revenue of all suppliers of a product
in a market during a certain period.

Positioning (line 55) - How you differentiate your product or service from that of your competitors
and then determine which market niche to fill . Positioning helps establish your product's or
service's identity within the eyes of the purchaser.

External investors (line 53) -

Customized product (line 61) - Individualised product tailored to individual customer want

Timeline:

1. 2000 - John Ariki built 12 villas

2. Present - Built 24 villas
3. 2006 - Opens JAC
4. Tasting, brochures and displays at JAC
5. JAC wins award as roaster
6. 2011- Paul and Liza take over
7. 2016 - Natural disaster, first financial loss & rebuilding
8. Paul and Liza explore options