Valentina Mónaco business

Business
A business is any organization that uses resources to meet the needs of customer by
providing a product or service that they demand.

Consumer goods: the physical and tangible goods sold to the general public. They include
cars and washing machines, which are referred to as durable consumer goods. Non- durable
consumer goods include food, drinks and sweets that can only be used once.

Consumer services: non- tangible products that are sold to the general public and include
hotel accommodation, insurance services and train journeys

Capital goods: physical goods that are used by industry to aid in the production of other
goods and services such as machines and commercial vehicles.

Economic sectors

Primary sector: Firms engaged in farming, fishing, oil extraction and all other industries that
extract natural resources so that they can be used and processed by other firms

Secondary sector (manufacturing): Firms that manufacture and process products from
natural resources, including computers, brewing, baking, clothing and construction

Tertiary sector (service) industries: firms that provide services to consumers and other
businesses, such as retailing, transport, insurance, banking, hotels, tourism and
telecommunications

Quaternary sector: is focused on information technology (IT) businesses and information

service providers such as research and development, business consulting and information
gathering.

Entrepreneur: someone who takes the financial risk of starting and managing a new venture

Intrapreneur: someone within a large corporation who takes direct responsibility for turning
an idea into a profitable finished product through using ‘entrepreneurial talents’ such as risk-
taking and innovation

Private Sector: comprises businesses owned and controlled by individuals or groups of

individuals

Public Sector: comprises organizations accountable to and controlled by central or local

government (the state)

Privatization: the sale of public sector organizations to the private sector. Privatization is
Benefit and Cost.

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Valentina Mónaco business

Sole trader: a business in which one person provides the permanent finance, in return, has
full control of the business, and is able to keep all of the profits

Partnership: a business formed by two or more people to carry on a business together, with
shared capital investment and, usually, shared responsibilities

Limited liability: the only liability – or potential loss – a shareholder has if the company fails
is the amount invested in the company, not the total wealth of the shareholder

Legal personality: It is legally recognized that a company has a separate identity from that
of its owners. This means, for example, that if products sold by a company are found to be
dangerous or defective, the company itself can be prosecuted, but not the owners, as would
be the case with a sole trader or a partnership.

Private limited companies: a small to medium-sized business that is owned by

shareholders who are often members of the same family; this company cannot sell shares to
the general public.

Public limited company (plc): a limited company, often a large business, with the legal
right to sell shares to the general public; its share price is quoted on the national stock
exchange

Social enterprises: A business with mainly social objectives that reinvests most of its profits
into benefiting society rather than maximising returns to owners

- Cooperative: a group of people acting together to meet the common needs and
aspirations of its members, sharing ownership and making decisions democratically

- Microfinance: the provision of very small loans by specialist finance businesses,

usually not traditional commercial banks.

Public–Private partnership (PPP): involvement of the private sector, in the form of

management expertise and/ or financial investment, in public sector projects aimed at
benefiting the public.

Non-profit organization: Any organization that has aims other than making and distributing
profit and which is usually governed by a voluntary board.

Non-governmental organization (NGO): A legally constituted body with no participation or

representation of any government, which has a specific aim and purpose, e.g. supporting
disadvantaged groups in developing countries or advocating the protection of human rights.

Charities: An organization set up to raise money to help people in need or to support

causes that require funding.

Mission statement: A statement of the business’s core aims, phrased in a way to motivate
employees and to stimulate interest by outside groups

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Vision statement: A statement of what the organisation would like to achieve or accomplish
in the long term.

Corporate aims: The long term goals which a business hopes to achieve

Divisional/operational objectives: Short- or medium-term goals or targets – usually

specific in nature – which must be achieved for an organisation to attain its corporate aims

Strategy: A long-term plan of action for the whole organisation, designed to achieve a
particular goal

Tactic: Short-term policy or decision aimed at resolving a particular problem or meeting a

specific part of the overall strategy

Ethics: moral guidelines that determine decision making

Ethical code (code of conduct): a document detailing a company’s rules and guidelines on
staff behaviour that must be followed by all employees.

Stakeholders: People or groups of people who can be affected by, and therefore have an
interest in, any action by an organization.

Corporate social responsibility: This concept applies to those businesses that consider
the interests of society by taking responsibility for the impact of their decisions and activities
on customers, employees, communities and the environment