Key Terms

advisory board
group of advisors that helps an organization make strategic decisions about the business, and brings certain knowledge and experience that can bring a new perspective on issues without having the actual authority to vote or govern

copyright
grants the creator of a work the exclusive right to reproduce the work, typically for a specified period of time

decision tree
flowchart diagram used to explore the outcomes of different decisions

economic factors
inflation, interest, employment, and currency exchange, rates, (among many other factors) that impact the business owner’s pricing of goods or services, the demand for such services, and the cost of production

funding sources
monetary resources used by the entrepreneur in the operation of the initial startup and early business

human resources
people hired by the entrepreneur to perform various duties in the business, provide customer service, or produce the goods

independent contractors
(also, freelancer) people or businesses that provide work similar to an employee without being part of the payroll for the contracting business, and who pay their own taxes and pay for their own benefits

intangible resources
assets that cannot be seen, touched, or felt, such as intellectual property, patents, designs, and processes

line of credit
lending of funds in exchange for a promise to repay

outsourcing
hiring an outside company or third party to perform a specific task, job, or process, or to manufacture goods

PEST
framework that can be used to distinguish political, economic, sociocultural, and technological factors influencing access to needed resources

political factors
stem from changes in politics, such as the policies of a new presidential administration or congressional legislation, as well as of state and local offices

pre-launch costs
cost of all the resources needed to open the business to the public

quota
specific number of units allowed into a country; sometimes quotas are limited to one source, such as one country, and sometimes the limit is placed on aggregate quantity regardless of source(s)

resource dependence theory (RDT) model
creating networks with business partners through mergers, vertical integration, joint ventures, or engaging in joint political activities to slow dependency among member groups

service mark
word, phrase, symbol, or graphic that identifies the origin or source of a service

sociocultural factors
changes in how society is moving and the direction of that movement as it relates to a customer base and potential new markets

tangible resources
assets that have a physical form as they can be seen, touched, and felt

tariffs
taxes or duties that are added to imported goods from another nation

technological factors
technological equipment and tools the enterprise needs to be sure it operates efficiently

trademark
registration that provides the owner the ability to use a name, symbol, jingle, or character in conjunction with a specific product or service, and prevents others from using those same symbols to sell their products