The Best Glossary on Business Studies
Welcome to the updated page of Business Studies Glossary. This page includes some of the most significant technical terms mainly used in the field of Business Studies and Research. Generally in a Glossary terms are arranged in alphabetic list for better reference. But in this page I have given a random list of most popular technical terms used in Business Studies.
A state of being busy in termed as business. Any human activity directed for production or acquisition of wealth through buying and selling of goods is known as business.
Exchange of goods for cash or credit is known as trade. Trade is primarily concerned with buying and selling of goods. Trade is regarded as the nuclear around whom the various activities of the commerce rotate.
Commerce denotes the sum total of business activities relating to distribution, marketing and the exchange of goods and services from the production centre. The organized system for the exchange of goods between the members of the industrial world is termed as commerce.
Those activities which are undertaken to produce, convert, extract and fabricate raw materials into finished product are known as industry. It is the place where raw materials are turned into finished product.
Entrepreneur is a person who takes initiative for establishing a business unit and he recognizes the need for a product or service.
The organization where various business activities are performed is called business enterprise. It is also regarded as a medium through which business activities are carried on.
Plant refers to an establishment where goods are produced or provisions of service originate. It is the production centre where machine, equipment and workers work together. The plant is otherwise called as mill or factory.
Firm denotes the broader sense of the term ‘plant’. It refers to an establishment which owns an manages the plant, arranges marketing of the products, and maintains proper control.
Buying and selling of goods and commodities within the national boundaries of a country is known as home trade. Home trade may consist of wholesale trade and retail trade.
Purchase and sale of goods and commodities among different countries of the world is called foreign trade. Foreign trade may be an export trade or import trade.
The organisation or establishment which does something with regard to sale of goods is called marketing enterprise. These organisations make frequent dealing with other business houses.
Constructive industry refers to a type of industries which is engaged in the creation of infrastructure for smooth development of the economy. These industries are engaged in the construction of docks, building, roads, dams, tunnels and canals.
The facilities which facilitate buying and selling of goods and commodities are called aids-to-trade. The aids-to-trade are transporting, packing, warehousing, insurance and financing. These are essential for the growth of trade in a country.
The risks which a businessman faces during the ordinary course of a business are called business risks. The examples of business risks are goods lost by fire, theft or accident.
Profession denotes some kind of vocation carried on by specialized knowledge of an individual. The professional man renders personal services of specialized nature in return of fees.
A sole trader is a form of business which is owned and controlled by a single individual. Since ownership belongs to one individual, he is regarded as the financer, manager and the administrator of his business.
The word unlimited liability denotes that there is no limitation to the liability of the individual. The sole proprietorship as a form of business organisation enjoys the status of unlimited liability.
Promptness in taking decision is termed as quick decision. The sole trader can take prompt decision with regard to his business affairs as he ha supreme authority over his business. The sole trader arrives at a decision point quickly because no other consultants or associates are there who are to be contacted at the time of decision making.
The agreement to carry on partnership business is called partnership deed. It contains exhaustive provisions with regards to the matters concerning the business and the partners. So it is the document where terms and conditions for the conduct of business are incorporated. This document is otherwise called as the “article of partnership”.
As the name implies, a sleeping partner is a person who sleeps and does not take active part in the day-to-day conduct of the business. Such a partner contributes capital for the business but does not take active part in the conduct of the business. He is otherwise called as dormant partner.
Limited partnership is a type of partnership where there is at least one general partner whose liability is unlimited and at least one special partner whose liability is limited. This type of partnership is found in UK, USA and other European countries. There is no provision of limited partnership under Indian Partnership Act, 1932.
A document which contains detail information about the joint stock company inviting public to subscribe for the share capital is called a prospectus. It is written invitation to the public to subscribe for share capital.
The process of conceiving an idea and developing it into concrete form through incorporation is called promotion. In other words, the process through which the idea of business opportunity is conceived, developed and assigned a shape in the form of company is called promotion.
A wholesaler is a person who buys large quantities of goods from the producers and resale them in small quantities to the retailers. He is regarded as the first intermediary in the channel of distribution.
A large scale retail establishment dealing in food products is called a super market. There is no sale assistants to sell the products. The customers collect their required articles through wheeled trollies and pay cash at the counter.
Vending machine is a type of selling machine where sale of the products is effected by inserting a coin to the machine. Railway tickets and bus tickets are sold by this machine.
Trade between two countries is called foreign trade. Foreign trade takes place when there are differences in the cost of production of commodities to be exchanged. Foreign trade is otherwise called as international trade.
The selling of goods by a home country to a foreign country is termed as export trade. The persons or institutions who carry on such types of trade are called exporters.
The buying of goods and services from a foreign country for the use of home country is termed as import trade. The persons or institutions who perform such types of trade are called importers.
Purchase of goods from a foreign country not for the sake of consumption but for re-selling those goods to another foreign country is termed as entrepot trade.
A printed form filled in all respect is submitted to dock authorities along with goods is called dock challan. This is prepared in duplicate. One copy is regained by dock authorities and the second copy is returned to the exporter which is known as dock receipt.
Bill of exchange along with shipping documents like bill of lading, invoice, insurance and certificate of origin is called a documentary bill.
Bank refers to an establishment for the custody of money and it pays out money on customer’s demand. Bank is a financial institution which acts as a purveyor of money as well as creator of money.
Banking denotes a certain type of activity engaged trading in money. The activities concerning trading in money are exchange of money, depositing of money and lending of money.
It is a banking sector which helps the agricultural people. The primary objective of agricultural bank is to provide short-term as well as long-term loan to the people engaged in agriculture.
A carrier is a person or an organisation who carries goods or passengers from one place to another. For the services of the carrier, he may or may not be paid.
When goods are delivered to the railway authorities, the sender of the goods fill up a form called consignment note. It contains description of goods, quality, name and addresses of the consignor and the consignee.
Bottomry bond is a contract where the ship and cargo is given security in an emergent situation to raise loan for the sake of completing the voyage. This bond is executed by the master of the ship. The money borrowed under this contract is repaid when the ship arrive in the port of destination safely.
When goods are sent by airways, the sender of the goods prepares airway bill in triplicate. The airway bill is otherwise called as air consignment note. The airway bill contains place and date of carriage contract, the place of departure, the name and addresses of the sender, name and addresses of the carrier, name and addresses of consignee, description of goods, nature of goods and the details of freight.
Pathways are an important form of land transport. It is the oldest form of transport found in hilly areas, forest areas and in remote places. These are used by human beings and animals for transport. In forest and hilly areas transport is carried on through human beings. Animal transport has also played a significant role where there is no road and railway communication.
Storage is a marketing function which involves stocking of goods for some time to equalize demand and supply of goods. Storage bridges the time gap between production and consumption of goods.
The service provided for storage of goods is termed as warehousing. A warehouse denotes a place where goods are stored by the owner till they are required. An establishment for storage or accumulation of goods is known as a warehouse.
The holder of warehouse warrant issues a delivery order when a part of the goods stored are transferred. The warehouse keeper gives a note on the warrant with regard to goods delivered.
When the importer keeps goods in the bonded warehouse, the warehouse keeper issues a receipt acknowledging the receipt of goods. Such a receipt is known as dock warrant.
Indent houses are specialized houses in import trade and act as middlemen between the importer and the exporter. They render a number of services to the importer by furnishing information on availability of goods, arranging credits and conveying the grievances of the importer to the exporters.
The premium consists of two types called pure premium and the margin. The premium calculated on the basis of age or prospects of life is called pure premium. The additional sum over the pure premium is called margin. This margin is otherwise called as loading or extra premium.
The transfer of interest in the policy which enables a person to receive payment of the sum assured in case of death is called nomination. The person to whom such an interest is transferred is called a nominee. Nomination is termed as a device of transferring interest in the policy.
Assurance is a contract where the insurer undertakes to pay an agreed sum of money after expiry of certain period or on the death of the persons whichever happens earlier. The contract of life insurance is the best example of assurance.
When an insurance company insures the risks with some other insurance company, it is called re-insurance. So transfer a part of risks on a particular policy by insuring it with other insurance company is known as Re-insurance.
When the subject matter of the insurance is insured by the insurer with two insurance companies, it is called double insurance. Taking more than one policies in case of life insurance is the best example of double insurance.
The written document which contains the contract of insurance is known as a policy. The terms and conditions stated in the policy are binding to both the insurer and the insured.
Industrial bank denotes a kind of bank which provides long-term financial, technical and managerial assistances to industries. These banks play a significant role in the development of industry of a nation.
Overdraft denotes a system of borrowing where the current account holder is allowed to draw more than the balance available to the credit of his account. Overdraft facility is allowed upto a certain limit.
Commercial banks refer to a type of bank which provide financial assistance to the trader of a country. They provide short-term financial assistance for the business. They accept deposit from the investors and extend loans in the form of loan, cash credit, overdraft and discounting of bills. There are two types of commercial banks found in India. These are scheduled and non-scheduled banks.
The process of buying and selling of goods or exchange of services within the national boundaries of a country is called home trade. The home trade may be a local or state or inter-state trade. The exchange of goods amongst the people of a particular locality is called local trade. The home trade is otherwise known as internal trade or domestic trade.
A multiple shop is a retail organisation where a single business owns a large number of retail shops which are scattered over various localities of a country and all are engaged in the same line of activities. Bata shoe Company and Delhi Cloth mills are the best examples of multiple shops in India.
One price shop is a retail organisation where the prices of all commodities dealt carry a single price irrespective of their quality. These shops usually deal with low-priced articles. These shops are popular in USA and “Woolworth” is the best example of the one price shop.
Mail order Business
Mail order business is a type of retail trade where orders for supply of goods are received through post and goods are sold through post. From the point of view of the buyer, it is regarded as shopping by post and from seller’s viewpoint, it is regarded as “Selling by Post”.
A departmental store is a type of retail organisation which deals in a wide variety of merchandise under one roof. The various departments of the departmental store are under same ownership, management and control. The primary aim of departmental store is too provide a wide varieties of goods to the consumer at one place.
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