Edexcel GCSE Business key terms

An estimate of a future outcome, such as sales revenue, costs or profit.

Learning through an organised, structured programme with specific objectives, delivered within the business or by an outside provider.

An arrangement allowing an entrepreneur to operate using an established business’s name, products and business system in return for fees.

The entrepreneur or business that pays to operate using a franchisor’s brand and business system.

The business that grants permission to use its brand and business system in a franchise arrangement.

A self-employed person who provides services to businesses on a job-by-job basis rather than being their employee.

A pricing approach that provides a basic product free of charge but charges for additional features or services.

An additional benefit provided to an employee beyond their basic wage or salary, such as a company car or private healthcare.

Working the normal full working week in a business, commonly around 35–40 hours.

The purpose of a product and how well it performs the tasks customers need it to perform.

An opportunity to supply customers whose needs are not currently being met by existing products or businesses.

The process by which national economies become more connected through trade, investment and technology, allowing businesses to buy, sell and operate across borders.

A physical product, such as a bicycle or a T-shirt.

The authorities responsible for governing a country, including setting and enforcing laws and collecting taxes.

Sales revenue minus cost of sales: the amount available to cover other operating expenses and interest before leaving net profit.

Gross profit expressed as a percentage of sales revenue, showing the proportion of sales revenue remaining after cost of sales.

Laws requiring businesses to protect people’s health, safety and welfare in connection with their activities.

An organisational structure with many levels of authority, usually a long chain of command and relatively narrow spans of control.

A takeover opposed by the management of the business being bought.

A good or service bought from another country.

Registered as a company with a legal identity separate from its owners.

The freedom an owner has to work for themselves and make their own business decisions.

The freedom an entrepreneur has to make decisions about their business and its direction.

A tax on spending, such as Value Added Tax (VAT).

A general increase in the prices of goods and services over time.

Learning through everyday work, such as watching an experienced colleague and receiving guidance, rather than following a structured course.

The introduction of a new or significantly improved product or way of doing something.