KS3 Business Key Terms & Vocabulary

Business

set up as a charity instead of for profit to direct all surplus into a cause.

Customers

stakeholders because they affect the business's success.

Public-sector services

usually funded by tax revenue.

Sole traders

usually the simplest type of business to set up.

A broad long-term goal for a business is called an aim.

Aims and objectives may change as a business and its market grow.

A clear set of aims helps every employee work in the same direction.

A challenge for social enterprises is balancing financial survival with their mission.

The BBC and Channel 4 are part of the UK public sector.

The UK enterprise that sells a magazine to support homeless people is The Big Issue.

A business provides goods or services for its customers.

Without businesses, customers would struggle to get many goods and services daily.

A common UK charitable cause is cancer research and treatment.

Charities rely on donations as well as any trading income.

Charities are a type of business focusing on social aims.

A charity based in England or Wales usually must register with the Charity Commission if its income is over £5,000 a year; smaller charities need not register, and Scotland and Northern Ireland have their own regulators.

An organisation that exists to help a cause, not profit, is called a charity.

A charity has non-financial aims as its main goal because its purpose is social impact, not maximum profit.

An aim that helps a business survive when costs rise sharply is cost control and efficiency.

A person who pays a business for its goods is a customer.

Two designers form a partnership rather than each staying a sole trader to share workload, ideas and start-up costs.

A person who gives money to a charity is a donor.

An employee mainly wants fair pay, safety and steady work.

A local resident affected by deliveries is an external stakeholder.

The Fairtrade movement matters to social enterprise because it pays producers a guaranteed fairer price.

A high-street florist counts as a business but a hobby gardener does not because the florist sells goods or services for income.

An arrangement that lets someone use an established brand for a fee is a franchise.

Physical items a business sells, such as bread or shoes, are called goods.

A feature of a 'good' that differs from a service is that it can be physically held and stored.

A growing business swaps survival aims for growth aims because profits and stability allow expansion plans.

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ATM

a cash machine that dispenses cash from a bank account.

Bank statement

a document that records money flowing in and out of a bank account in a given period.

Budget

a written plan for income and expenditure over a period.

Compound interest

interest earned on past interest as well as on the original principal.

Current account

used for everyday spending: receiving wages and paying bills.

Debit card

used to spend money already in the customer's account, not borrowed money.

Deficit

spending more than you earn over a period.

Emergency fund

money kept aside for unexpected costs.

Buying a takeaway pizza

expenditure; receiving pocket money is income.

Fixed expense

a cost that stays roughly the same each month (e.g. rent).

Flexible budget

one that adapts when costs or income change.

Impulse spending

buying something on the spur of the moment without having planned to.

Income

all the money a person receives in a period (e.g. a month).

Interest

the cost of borrowing money (or the reward for saving it).

House deposit

an example of a long-term saving goal for a young adult.

House deposit

a long-term goal; buying lunch tomorrow is a short-term spend.

Reviewing the budget monthly

useful because costs and income often change with life events.

Need

something essential for survival (food, water, shelter, warmth).

Overdraft

borrowed money from the bank. It is not saving, and interest can be charged.

Pension

a workplace long-term savings plan that pays in retirement.

Saving

setting money aside for the future instead of spending it now.

Savings account

designed mainly to earn interest on money set aside.

Interest

what a savings account pays the customer.

SMART goals

Specific, Measurable, Achievable, Relevant and Time-bound.

Standing order

an automatic regular payment from a bank account, set by the customer.

Surplus

income is greater than expenditure for the period.

Drinking water

a basic need; a new phone, concert tickets and designer trainers are wants.

Interest expressed as a percentage of a year is called the annual rate.

Apps and spreadsheets make it easier to track a budget over time.

APR stands for Annual Percentage Rate: a standardised yearly cost of borrowing.

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APR

useful because it combines interest and standard fees into one annualised figure, making comparisons fair between lenders.

Initial payments

small and instant, which can make BNPL feel less like borrowing.

Personal loan

usually cheaper than a credit card for large purchases because loans charge a lower interest rate.

Mortgage

usually treated as good debt because homes can rise in value over time.

UK scam victims can report what happened to Report Fraud (formerly Action Fraud) and the police.

Affordability is the ability to repay a loan comfortably from regular income.

Asking "can the repayments fit the monthly budget?" is the key affordability question before taking on any debt.

APR stands for Annual Percentage Rate and shows the yearly cost of a loan as a percentage.

Of two loans, the one with the lower APR is the cheaper borrowing (all else equal).

Using a high-interest credit card for short-term consumption like takeaways is a classic example of bad debt.

Debt that funds an item that loses value quickly is often called bad debt.

A sensible rule before using BNPL is to check that the total fits the monthly budget.

Across many small BNPL plans, total debt can creep up without the shopper noticing.

BNPL splits a purchase into smaller instalments paid over weeks or months.

BNPL agreements often start interest-free but charge fees if payments are missed.

BNPL stands for Buy Now Pay Later: a short-term credit option at checkout.

Missing BNPL payments can lead to fees and a damaged credit history.

A warning sign of overuse is having multiple unpaid payment plans at once.

Many BNPL providers now report to UK credit reference agencies (Experian, Equifax, TransUnion).

Borrowing lets a person make a big purchase before they have fully saved up for it.

Borrowing usually costs more than the amount borrowed because of interest.

A sensible response to a suspicious "your bank" text is to ignore the link and call the bank directly using the number on the card.

Borrowers should compare the total amount repaid, not just the monthly payment: a smaller monthly payment over a longer term can cost more in total.

Many credit cards charge an annual fee in return for rewards like cashback or air miles.

A credit card is a plastic payment card that lets a customer spend now and repay later.

Credit-card balances attract interest if they are not paid off in full each month.

Failing to make even the minimum credit-card payment can damage a credit score.

Credit risk is the risk that a borrower will fail to repay what they owe.

A credit score is a number that reflects a person's past borrowing behaviour and predicts future repayment.

Money owed by a borrower to a lender is called debt.

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Advertising

paid promotion that brings attention to a product or service.

Brand

the identity (name, design and symbols) that makes a product recognisable.

Brand loyalty

valuable because loyal customers buy repeatedly and recommend the brand to others.

Customers

the people who buy a business's goods and services.

Hashtag

a short tag starting with # used to group social-media posts.

Influencer

a partner who promotes products on social media to their followers.

Influencer

a popular online personality paid to recommend products.

Instagram

a social platform known for photo and reel sharing by brands.

Logo

a visual symbol that identifies a brand.

Marketing

all the ways a business attracts and keeps customers.

Online advertising

often cheaper for a small business than TV because smaller budgets can still reach a targeted audience.

Place

where customers can buy the product (channels and distribution).

Price

the decision about the cost to charge customers.

Promotion

the P that covers how a product is advertised and presented to customers.

Customers

often segmented by age because different ages have different needs and habits.

Sponsorship

paying to link a brand to an event, team or person in return for promotion.

Target market

the group of customers a business aims its product and marketing at.

Tesco

a well-known UK supermarket brand (Toyota = cars, Adidas = sportswear, Spotify = music).

Trademark

the legal protection for the brand name and logo.

Viral content

content that spreads quickly online from person to person.

In the UK, the ASA regulates adverts (including on social media) to stop misleading claims and ensure they are "legal, decent, honest and truthful."

A strong brand lets a business charge more because customers trust the brand and perceive higher value.

A logo and a consistent visual style help customers spot a brand quickly on a shelf or online.

A detailed sketch of a typical customer is called a customer persona.

Digital advertising channels include social media, search engines, display ads and mobile ads.

For a luxury product, disposable income is the most useful customer detail because it shows who can afford to buy.

Businesses focus on one group rather than "everyone" because targeted marketing makes resources stretch further.

The traditional marketing mix has four Ps.

Strong marketing usually needs the four Ps to work together as one consistent mix.

Identifying customer needs and meeting them is part of marketing.

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Brainstorming

generating many ideas freely in a group before evaluating them.

Break-even

the point at which revenue equals total cost.

Business plan

a document explaining a business's idea, market and finances.

Poor cash-flow management

a common reason new businesses fail in the first year.

Crowdfunding

many people each investing small amounts online.

Monthly shop rent

a fixed cost: it does not change with output.

Great idea

not the same as a great business; execution matters too.

Insolvency

when a business legally cannot pay its debts.

Insolvency

when a firm cannot pay its debts.

Market research

research that investigates customer needs and a target market.

Online surveys

a quick, low-cost way to gather primary research.

Primary market research

collecting new data directly from customers.

Making a profit

important because it funds growth and rewards the owner.

Revenue

the total income from selling goods or services.

Business plan

most useful when reviewed and updated regularly.

Survey

a question form that gathers customer opinions.

Selling above the break-even point begins to generate profit.

A business in financial trouble may seek formal help called administration.

An angel investor uses their own money to back a start-up.

A drawback of borrowing from a bank is that interest must be repaid even if profits fall.

An entrepreneur can get a long-term loan to start a business from a bank.

Banks usually ask for a business plan because it shows whether the loan will be repaid.

A small or biased sample can give misleading market-research results.

Keeping a careful budget and forecast reduces the chance of business failure.

A wealthy individual investing in a start-up in return for shares is a business angel.

50 cakes at £3 = £150 revenue; £150 − £100 costs = £50 profit.

Poor cash flow causes failure because bills cannot be paid even if the business is profitable.

Running out of cash before profits arrive is a common reason businesses fail.

If costs rise but price stays the same, profit per item falls.

Crowdfunding raises small sums from many online supporters.

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Bonus

a one-off extra payment for good performance.

Class 1

the class of NI paid by most employees.

Gross pay

total pay before any deductions.

HMRC

the UK department that collects income tax from workers.

Income tax

the tax taken from earnings each month.

Net pay

more useful than gross pay for daily budgeting because it is what arrives in the account.

Net pay

always lower than gross pay for an employee paying income tax.

Net pay

what an employee receives after tax and deductions.

NHS

a UK public service funded by taxes.

National Insurance number

the unique reference identifying a worker for NI.

National Insurance number

needed for working legally in the UK.

P60

the document that confirms an employee's yearly pay and tax.

Pension contributions

sometimes taken from gross pay as a deduction.

Personal allowance

the amount of yearly income a person can earn tax-free.

Salary

typically a fixed annual amount paid in equal monthly instalments.

Salaried worker

usually paid the same amount even if they work extra hours.

Salary

steady and predictable each month, which workers may prefer for budgeting.

Sales commission

a payment linked to the value of sales achieved.

Tax code

the letter-and-number code on a payslip that your employer uses to work out how much Income Tax to take from your pay.

Taxes

"compulsory": paying them is required by law.

VAT

an "indirect" tax because it is paid through prices, not directly by the shopper to HMRC.

VAT

the UK tax added to the price of most shop goods.

Wage

payment calculated per hour worked.

Fresh apple

an example of a zero-rated item (no VAT).

The additional rate at the highest band applies to very high earners (over £125,140 in 2024/25).

A café worker is more likely to be paid a wage (hourly) than a salary.

Local councils collect council tax to help pay for local services.

Income tax and National Insurance are usually deducted from gross pay before net pay is calculated.

Employers also pay National Insurance contributions for each employee.

The fire and rescue service is a public service paid for by taxes.

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Thinking like an entrepreneur

called enterprising.

Risk-taking

part of enterprise, but reckless risks can sink a business fast.

Investing personal savings

a risk because some or all of the money could be lost.

New idea

stronger when it solves a clear customer problem.

Steve Jobs and Steve Wozniak founded Apple in 1976.

Jeff Bezos built Amazon from an online bookstore.

Anita Roddick founded The Body Shop.

Richard Branson founded the Virgin Group of companies.

Potential financial loss if a business fails is called business risk.

One common entrepreneurial trait is willingness to take calculated risks.

A typical entrepreneurial characteristic is willingness to take calculated risks.

Strong communication and leadership help an entrepreneur recruit and lead a team.

Creativity helps an entrepreneur spot new opportunities and solutions.

A sign of a good business opportunity is customers willing to pay for the solution.

Starting a dog-walking service in a local area is an example of enterprise in everyday life.

The TV programme where entrepreneurs pitch to investors is called Dragons' Den.

James Dyson fronted the early Dyson vacuum-cleaner brand.

Enterprise means starting and running your own business.

Enterprise skills can be useful even for people who never start their own business (intrapreneurship).

Being enterprising means spotting opportunities and acting on them.

Someone who starts and runs a business is called an entrepreneur.

Many famous entrepreneurs experienced failures before later successes.

The Global Entrepreneurship Monitor asks new entrepreneurs about four motives: to make a difference in the world, to build great wealth or a very high income, to continue a family tradition, and to earn a living because jobs are scarce. Across the UK, continuing a family tradition is far less often cited than the other three.

A financial risk of starting a business is losing the savings invested in start-up.

A gap in the market is an unmet customer need with no current supplier.

Enterprise leads to economic growth because new businesses create jobs and innovation.

A possible reward for taking business risks is higher profits if the business succeeds.

Higher-risk ideas often promise the biggest possible reward.

Some prefer self-employment for greater independence and control over decisions.

Entrepreneurs use innovation to think differently.

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Artificial intelligence (AI)

technology that lets computers perform tasks that normally need human intelligence, such as recognising patterns or learning from data.

Different countries' currencies

converted through an exchange rate.

Goods bought from abroad

called imports.

Using computers to do work without humans is called automation.

Automation can replace some routine tasks once done by humans.

A carbon footprint is the total greenhouse gases linked to an activity, product or organisation.

A carbon footprint is the footprint that shows greenhouse-gas use.

A small local shop can struggle against a national chain because chains buy in bulk and charge lower prices.

Using child labour to make cheap clothes is an example of unethical business behaviour.

Storing data remotely on servers over the internet is called cloud computing.

Coca-Cola operating across many countries is an example of a multinational company.

Some customers are willing to pay more for products made ethically.

A business's voluntary efforts to behave responsibly are called corporate social responsibility (CSR).

Cyber-security is now a major concern for every business with online systems.

Businesses must protect customer data because UK law and customer trust both require it.

A benefit of e-commerce for a small business is selling 24/7 to a wider geographic market.

E-commerce has changed retail because customers shop online without visiting shops.

Ethical practices can boost a business's reputation and customer loyalty.

Ethical means doing business in a morally responsible way.

A business demonstrates ethical sourcing by using certified Fairtrade or organic suppliers.

Fair trade means paying producers a fair price for their goods.

The UK Fairtrade mark signals that producers in poorer countries have been paid fairly.

A business operating across many countries is described as global.

Many global brands started as small local businesses (Apple, McDonald's, Coca-Cola).

One benefit of globalisation for UK consumers is wider product choice at lower prices.

Globalisation is increasing economic links between countries.

A downside of globalisation for UK workers is job losses when factories relocate abroad.

Globalisation has been driven partly by cheap shipping and the internet.

Businesses invest in greener packaging because customers and regulators value lower-waste options.

Greenwashing is when a business claims eco-credentials it does not have.

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A levels

typically studied at a sixth-form college or school sixth form.

Career stereotypes

harmful because they limit who feels welcome in each role.

Both A levels and T levels can lead on to a university degree.

An apprenticeship mixes paid work with study.

Apprenticeships pay a wage while the apprentice trains for a qualification.

The route that mixes paid work with study is the apprenticeship.

Skilled trades like electrician most often require an apprenticeship pathway.

A benefit of doing an apprenticeship rather than A levels is earning a wage while gaining experience.

Some careers, like the armed forces, accept entrants straight after KS4.

Many adults change career direction at least once in their working life.

A career is a long-term sequence of jobs across a person's working life.

Talking to a careers adviser can help plan post-16 choices.

A school careers fair helps students explore career options.

A personal benefit of lifelong learning is confidence and adaptability through life.

A covering letter explains why the applicant suits the job.

Yearly professional updates by workers are called continuing professional development (CPD).

A game designer at a studio is a typical creative-industry career.

A CV is a written summary of a person's education and work history (Curriculum Vitae in Latin).

A CV should leave off untruths about qualifications or experience.

Name and contact details go at the top of a CV so employers can reach the applicant.

A university course after A levels or T levels typically leads to a degree qualification.

Treating people unfairly because of a stereotype is called discrimination.

Gender balance in STEM matters because diverse teams produce broader and better solutions.

A workforce with a variety of backgrounds is called diverse (workplace diversity).

Employers often value staff who keep updating their skills.

A common stereotype about engineering is that engineering careers are mainly for men.

The UK law that prohibits discrimination in hiring is the Equality Act 2010.

An adult evening class in coding is an example of lifelong learning.

A low-cost way for an adult to keep learning is free online courses from reputable sites.

Most students sit GCSE exams at the end of KS4.

Showing 30 of 60. Practise the full Careers and the world of work set →

Harassment at work

unlawful in the UK under the Equality Act 2010; bullying itself is not against the law.

CEO

the most senior decision-maker at the top of a large company.

Constructive feedback

feedback that points out what could be improved.

Customer-service skills

valuable even in roles that are not customer-facing.

Employee

a person paid to work by a business.

Full-time UK employees

legally entitled to at least 5.6 weeks paid annual leave.

Interview

a chance for both employer and candidate to find out about each other.

Leadership

the skill of guiding and motivating others at work.

Listening carefully

a key communication skill.

Marketing manager

responsible for advertising and customer research.

Person specification

the skills and qualities needed for a job.

Problem-solving

a transferable skill useful across many jobs.

Self-employed people

responsible for their own income tax and National Insurance.

Skills

practical talents employers look for.

Team member

a worker who reports to a team leader.

Teamwork

people working together toward a common goal.

Trade union

an organisation that represents workers and negotiates with employers over pay and conditions, for example Unite or the GMB.

Voluntary work

unpaid time given to help others.

Coding in a programming language is a hard (technical) skill employers value.

Good communication at work avoids mistakes and saves time.

A contract of employment is the document an employee signs to start work.

A covering letter usually accompanies a CV to introduce the applicant.

The customer-service team usually handles complaints in a shop.

CV stands for curriculum vitae: the document candidates send when applying for jobs.

Using spreadsheets to manage data is an example of digital literacy.

Diverse teams often bring more varied ideas to a project.

Most large UK businesses divide their work into separate departments.

A sign of an effective team is that members trust each other and share work fairly.

A benefit of being employed is steady wages and paid holiday entitlement.

An engineer or maintenance technician makes sure a factory's machinery keeps running.

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Cash

the physical form of money: coins and banknotes.

Contactless

faster than chip-and-PIN for small purchases.

Cryptocurrency

digital money held on a computer system.

Bank-account balance

an example of digital money.

Euro

used as legal tender in France, Germany and other Eurozone members.

Exchange rate

the price of one currency in terms of another.

UK money

no longer backed by gold: it is fiat money.

Signed personal letter

not a form of money; notes, coins, and account balances are.

M-commerce (mobile commerce) payments

usually made on a smartphone.

UK coins

made by the Royal Mint.

Money

a store of value because it keeps its worth over time so people can save it.

Birthday gift

an example of unearned income.

Money

a "unit of account": the function that lets us measure how much things cost.

Wheat

not money in modern Britain: the forms are notes, coins, card balances and app balances.

Money sent between bank accounts electronically is called a bank transfer.

A problem with bartering is that both people must want what the other offers (the "double coincidence of wants").

A government payment to support people unable to work is called a benefit.

The Bank of England issues new banknotes for England and Wales.

The Bank of England prints UK banknotes: not councils, banks, or government departments.

Travellers usually swap pounds for foreign cash at a bureau de change.

A disadvantage of cash for large purchases is that it can be lost or stolen easily.

Coins and paper notes used for everyday payments are called cash.

A card with a small chip for tap pay is called a contactless card.

A benefit of contactless cards is fast checkout with no PIN for small purchases.

Tapping a contactless debit card is a digital payment method.

Direct debit lets a business collect payment from a customer's account regularly.

"Exchange rate" is the term that sets how currencies swap.

Currency not backed by gold is called fiat money.

The £50 note is the highest-value banknote in everyday UK use.

Travellers swap home currency for "foreign" currency before visiting another country.

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