HSC Business Studies key terms

The business function that turns inputs such as materials, labour and information into finished goods or services that customers buy and value.

The set of activities that convert inputs into outputs, adding value at each step through facilities, technology and the work of employees.

The increase in worth of a product as each stage of production or service delivery adds features, convenience or quality that customers will pay for.

The resources a business draws on to produce goods or services, including raw materials, labour, capital equipment, information and customer needs.

The final goods or services that result from the transformation process and are delivered to customers, including any waste or by-products.

Long-term decisions about how production will be organised, covering capacity, location, layout, technology and quality, so operations support the business's overall goals.

The targets operations aims to meet, commonly quality, speed, dependability, flexibility, customisation and cost, which guide process design and improvement.

The proportion of a business's maximum possible output that is actually being produced in a given period, usually expressed as a percentage.

Cost advantages that arise as output increases, because fixed costs are spread over more units and purchasing or production becomes more efficient.

Coordinating the flow of materials, information and payments from suppliers through production to customers so goods arrive at the right time and quality.

Planning and controlling the storage and movement of goods, including warehousing, inventory and transport, so products reach customers efficiently.

Obtaining inputs such as materials, components or services from suppliers located outside the business's home country, often to reduce costs or access expertise.

Contracting another business to perform a function or process that was previously done internally, such as manufacturing, IT support or payroll.

The systems and practices a business uses to ensure products consistently meet customer expectations, including quality control, quality assurance and continuous improvement.

Inspecting and testing outputs, often at the end of production, to identify defects and remove faulty items before they reach customers.

Designing processes and standards so that quality is built in at every stage, rather than relying on inspection of finished goods alone.

Controlling the quantities of raw materials, work in progress and finished goods held by a business to balance holding costs against the risk of running out.

The business function that identifies customer needs and designs, prices, promotes and distributes products to satisfy those needs profitably.

The combination of product, price, promotion and place decisions a business adjusts to meet the needs of its target market.

Dividing a broad market into smaller groups of buyers with similar characteristics or needs so marketing can be tailored to each group.

The specific group of customers a business chooses to aim its products and marketing efforts at, selected from the wider market.

The place a product occupies in customers' minds relative to competitors, shaped by image, price, quality and the benefits the brand emphasises.

Creating a name, symbol or identity for a product or business so customers recognise it and associate it with particular qualities or values.

The stages a product passes through over time, typically introduction, growth, maturity and decline, each requiring different marketing decisions.

The approach used to set prices, such as cost-plus, market-based, skimming or penetration pricing, chosen to suit objectives and competitive conditions.

The methods a business uses to communicate with customers and persuade them to buy, including advertising, personal selling, publicity and sales promotions.

The route a product takes from producer to consumer, which may involve intermediaries such as wholesalers and retailers or go direct.

Collecting and analysing information about customers, competitors and market conditions to support marketing decisions; it may be primary or secondary.

The business function concerned with planning, obtaining and managing money so the business can fund its activities and meet its obligations.

The movement of money into and out of a business over a period, showing whether enough cash is available to pay expenses as they fall due.

The funds available for day-to-day operations, calculated as current assets minus current liabilities, indicating short-term financial health.

The ability of a business to convert assets into cash quickly to meet short-term debts and day-to-day expenses.

A financial plan that estimates expected income and expenditure over a future period, used to guide spending and monitor performance.

Calculating the level of sales at which total revenue equals total costs, so the business makes neither a profit nor a loss.

Expenses that do not change with the level of output in the short term, such as rent, insurance and salaried management wages.

Expenses that change in direct proportion to the amount produced or sold, such as raw materials and hourly production labour.

The capacity of a business to earn more revenue than it spends on costs, often measured by ratios such as gross profit and net profit margins.

The proportion of a business's capital that is funded by debt rather than owners' equity, indicating financial risk and reliance on borrowing.

The business function that manages the relationship between an organisation and its employees, covering recruitment, training, pay and workplace relations.

Attracting and selecting suitable people to fill positions in a business, through activities such as advertising vacancies, screening and interviewing.

Activities that build employees' skills and knowledge, helping them perform current roles and prepare for future responsibilities.

The processes used to set expectations, review and improve how well employees perform, including appraisals, feedback and goal setting.

The internal and external forces that drive employees to work productively and stay committed to the organisation's goals.

The rate at which employees leave a business and are replaced, which can raise costs and disrupt operations when it is high.

The interaction between employers, employees and their representatives, covering bargaining, disputes and workplace agreements.

A negotiated workplace agreement between an employer and employees, approved by the industrial regulator, that sets wages and conditions for a group of workers.

A feature or capability that lets a business outperform rivals, such as lower costs, superior quality, faster delivery or strong brand loyalty.

A strategy of becoming the lowest-cost producer in an industry so the business can compete on price or earn higher margins than rivals.