Castilla y León PAU Business and Business Model Design flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

Opportunity cost

The value of the best alternative forgone when a resource is committed to one use. It is the relevant cost for comparing business decisions, even when no money changes hands.

PESTEL analysis

A framework scanning the macro environment through political, economic, socio-cultural, technological, ecological and legal factors. It identifies external opportunities and threats the firm cannot control but must anticipate.

Stakeholder

Any individual or group affected by or able to affect the firm's decisions and results: owners, employees, customers, suppliers, creditors, unions, government and local community. Their interests may conflict.

Corporate social responsibility

The voluntary integration of social, environmental and ethical concerns into business operations and stakeholder relations, going beyond legal minimums. It can reduce reputational risk and improve long-term legitimacy.

Sociedad Limitada

A Spanish limited company with capital divided into participaciones, a legal minimum of 3,000 euros fully paid, liability limited to contributed capital, and restricted transfer of shares.

Sociedad Anónima

A Spanish company whose capital is divided into freely transferable shares, with a minimum of 60,000 euros of which at least 25% is paid on incorporation. It suits large capital-raising ventures.

Unlimited liability

A legal condition in which the owner answers for business debts with personal assets, not only with capital invested. Typical of the sole trader, sociedad civil and general partners.

Sociedad Laboral

A Spanish company form in which at least 51% of capital belongs to employees with indefinite contracts, with tax advantages and limits on individual shareholdings.

Incorporation steps

Name certification from the Mercantile Registry, capital deposit in a bank, public deed before a notary, Mercantile Registry registration, then tax identification and Social Security registration.

Porter five forces

An industry analysis covering rivalry among existing competitors, threat of new entrants, threat of substitutes, buyer bargaining power and supplier bargaining power. Strong combined forces depress industry profitability.

Cost leadership strategy

A generic strategy based on producing at the lowest cost in the industry so the firm can compete on price or earn higher margins. It requires scale, efficiency and tight cost control.

Differentiation strategy

A generic strategy in which the firm offers attributes consumers value enough to pay a premium: quality, design, brand, service or technology. The extra price must exceed the extra cost.

Ansoff matrix

A growth framework crossing products (existing or new) with markets (existing or new): market penetration, product development, market development and diversification, which carries the highest risk.

SWOT analysis

A tool crossing internal strengths and weaknesses with external opportunities and threats. Its value comes from converting findings into strategies: exploit, correct, defend or avoid.

Business Model Canvas

A one-page model with nine blocks: customer segments, value proposition, channels, customer relationships, revenue streams, key resources, key activities, key partnerships and cost structure.

Value proposition

The bundle of benefits a firm promises a specific customer segment to solve a problem or satisfy a need. It must be distinctive, testable and matched to the segment's priorities.

Recurring revenue stream

Income received repeatedly from the same customer, such as subscriptions, licences, leases or usage fees. It improves revenue predictability compared with one-off transactions.

Freemium model

A business model offering a free basic service to attract a large user base and charging for premium features. It works when conversion rates and retention offset the cost of free users.

Primary market research

Data collected first-hand for the specific problem: surveys, interviews, observation and experiments. It is tailored and current but slower and more expensive than secondary data.

Marketing mix

The set of controllable commercial variables, traditionally product, price, place and promotion; services add people, processes and physical evidence. Each must be consistent with the target segment and positioning.

Customer acquisition cost

Total sales and marketing spending divided by the number of new customers acquired in a period. It is compared with customer lifetime value to judge commercial viability.

Product life cycle

The sequence of introduction, growth, maturity and decline in a product's sales. Each stage calls for different pricing, promotion and distribution decisions.

Penetration pricing

Setting a low initial price to win market share quickly and deter entrants, then raising it later. It sacrifices early margin and requires cost or scale advantage to be sustainable.

Break-even point

The sales volume at which total revenue equals total cost, so profit is zero. In units it equals fixed costs divided by contribution margin per unit (price minus variable cost).

Net present value

The sum of future cash flows discounted at the cost of capital, minus the initial investment. A positive NPV means the project adds value and should be accepted.

Internal rate of return

The discount rate that makes a project's net present value equal to zero. A project is accepted if its IRR exceeds the firm's cost of capital.

Return on equity

Net profit divided by shareholders' equity, expressed as a percentage. It measures the return generated on owners' funds and rises with financial leverage, which also raises risk.

Working capital

Current assets minus current liabilities. It measures short-term financial cushion; a positive value means current obligations are covered by assets expected to turn into cash within a year.

Financial leverage

The use of debt in the capital structure. It magnifies return on equity when the return on assets exceeds the interest rate, and magnifies losses when it does not.

Functional structure

An organisational design grouping activities by specialism such as production, marketing, finance and human resources. It favours efficiency and expertise but can create coordination silos between departments.

Matrix structure

An organisational design in which employees report to both a functional manager and a project or product manager. It improves coordination but creates dual authority and role conflict.

Herzberg two-factor theory

Motivation theory separating hygiene factors (pay, conditions, supervision), which prevent dissatisfaction, from motivators (achievement, recognition, responsibility), which produce genuine satisfaction and effort.