Quality control refers to the process, most often implemented in manufacturing, of monitoring the quality of finished products through statistical measures and an overall corporate commitment to producing defect-free products. Quality control principles can also be utilized in service industries.
Racial discrimination is the practice of letting a person's race or skin color unfairly become a factor when deciding who receives a job, promotion, or other employment benefit. It most often affects minority individuals who feel they have been unfairly discriminated against in favor of a Caucasian (or white) individual, but there have been recent cases where whites have claimed that reverse discrimination has occurred—that is, the minority received unfairly favorable treatment at the expense of the white individual.
Rebates, widely known as refunds, are a popular tool used by businesses to promote their products and services. Rebates are distinct from coupons and other forms of discounting in that they reimburse a customer for part of the purchase price following, rather than at the time of, the sale.
Reciprocal marketing describes a situation in which two businesses promote each other in order to gain a mutual benefit. In the late 1990s and early 2000s, it has become a highly popular method of marketing for electronic retailers.
Record retention refers to the practice of retaining copies of business or personal records over time. It is important for small business owners not only to keep good records, but also to know which ones to retain and for how long.
Recruiting describes the processes companies use to find qualified candidates to fill job openings. Some types of recruiting, such as college recruiting and networking, also serve to bolster the company's image among certain groups of potential employees.
Over the past few decades, recycling has become a central component of many business operations in the United States. Recycling is valued for the cost-savings associated with some programs as well as its general environment-friendly aspects.
Reengineering is a management tool that became popular in the late 1980s and early 1990s. Like many such tools, it aims to cut costs while at the same time increasing productivity and providing higher levels of service.
Refinancing is the refunding or restructuring of debt with new debt, equity, or a combination of both. The refinancing of debt is most often undertaken during a period of declining interest rates in order to lower the average cost of a firm's debt.
Regulation D is a section of the U.S. federal securities law that provides the means for small businesses to sell stock through direct public offerings (DPOs).
The Regulatory Flexibility Act (RFA) of 1980 is a law designed to make government agencies review all regulations that they impose to ensure that they do not place a disproportionate economic burden on small business owners and other small entities. The Regulatory Flexibility Act was intended to extend protection to three different types of small entities in the United States: small businesses (as defined by the Small Business Administration); small organizations (nonprofit establishments that are independently owned and operated and not dominant in their field); and small governmental jurisdictions (defined as governments of cities, counties, towns, townships, villages, school districts, and other districts with populations of less than 50,000).
Relocation is the action of transferring a company's place of operation from one physical location to another. For small businesses, the act of relocating is often fraught with uncertainty, since the margin for error in companies with modest financial resources is so small.
Remanufacturing is a process where a particular product is taken apart, cleaned, repaired, and then reassembled to be used again. Many different types of products can go through this process, including auto parts, tires, furniture, laser toner cartridges, computers, and electrical equipment.
Renovation describes a series of planned changes and updates made to a facility where business is conducted. Office and building renovation is a common undertaking in today's competitive business environment, as businesses endeavor to keep up with infrastructure needs (especially those sparked by technology use) and provide aesthetically pleasing settings for customers.
Request for Proposal (RFP) is the process by which a corporate department or government agency prepares bid documents to acquire equipment or services. RFPs are frequently published in the legal documents section of pertinent newspapers or in trade journals covering the industry in which the department operates.
Research and development (R & D) is a process intended to create new or improved technology that can provide a competitive advantage at the business, industry, or national level. While the rewards can be very high, the process of technological innovation (of which R & D is the first phase) is complex and risky.
A résumé is a document presented by a job applicant to a prospective employer outlining and summarizing that person's qualifications for employment. A résumé generally includes data on education, previous work experience, and personal information, and well-crafted ones are composed in such a way as to maximize the applicant's attractiveness as a potential employee.
Retailers are business firms engaged in offering goods and services directly to consumers. In most—but not all—cases, retail outlets are primarily concerned with selling merchandise.
Retirement planning describes the financial strategies individuals employ during their working years to ensure that they will be able to meet their goals for financial security upon retirement. Making sound decisions about retirement is particularly important for self-employed persons and small business owners.
Return on assets (ROA) is a financial ratio that shows the percentage of profit that a company earns in relation to its overall resources. It is commonly defined as net income (or pretax profit) / total assets.
Return on investment (ROI) is a financial ratio that compares the amount of income derived from an investment with the cost of the investment. ROI is known as a profitability ratio, because it provides information about management's performance in using the resources of the small business to generate income.
Return policies are the rules retail merchants establish to manage the process by which customers return or exchange unwanted or defective merchandise that they have purchased previously. Return policies are an extension of the customer service retailers provide, and thus are often fairly liberal.
For organizations to make money and to survive in the long run, they must have constant sources or streams of revenue. Revenues come from sales, and the various categories of sales of a service or manufacturing firm are known as revenue streams.
Right-to-know laws are a group of rules and regulations at the state and national levels that mandate that employers share scientific information with workers and local communities about the toxicity and other characteristics of chemicals and materials used in business processes. This information encompasses all substances to which workers might be exposed in the workplace, including materials and chemicals utilized in producing goods or providing services, chemical releases into the environment, waste management, and long-term exposure to substances.
Risk management involves identifying, analyzing, and taking steps to reduce or eliminate the exposures to loss faced by an organization or individual. The practice of risk management utilizes many tools and techniques, including insurance, to manage a wide variety of risks.
The term "risk and return" refers to the potential financial loss or gain experienced through investments in securities. An investor who has registered a profit is said to have seen a "return" on his or her investment.
The Robotic Industries Association defines robot as follows: "A robot is a reprogrammable, multifunctional manipulator designed to move material, parts, tools or specialized devices through variable programmed motions for the performance of a variety of tasks." Recently, however, the industry's current working definition of a robot has come to be understood as any piece of equipment that has three or more degrees of movement or freedom.
Royalties are payments made by one company (the licensee) to another company (the licensor) in exchange for the right to use intellectual property or physical assets owned by the licensor. For example, software giant Microsoft invented the Windows operating system for personal computers as a means of managing files and performing operations.
Royalty financing is a relatively new concept that offers an alternative to regular debt financing (loans and trade credit) and equity financing (venture capital and stock sales). In a royalty financing arrangement, a small business would receive a specific amount of funds from an investor or group of investors.
Rural businesses are those firms that are established and operate in rural settings, far from the metropolitan areas that have traditionally been the site of most non-agricultural business enterprises. Most businesses continue to conduct business in large cities or thriving suburbs, but analysts contend that technological advances, demographic changes, and increased attention to "quality of life" considerations have all combined to spur meaningful business growth in many rural areas as well.
A small business has the option of incorporating at the beginning of its existence or after years of doing business. Once it incorporates, it has two choices: to be a regular C corporation by default or to elect S corporation status, a name derived from Subchapter S of the Internal Revenue Code.
The sales commission is a method of compensating salespeople for the services they provide to their employer. Under so-called "straight" commission arrangements, the salesperson receives a previously agreed-upon percentage of the revenue brought in by a sale that he or she makes.
A sales contract is an agreement between a buyer and seller covering the sale and delivery of goods, securities, and personal property other than goods or securities. In the United States, domestic sales contracts are governed by the Uniform Commercial Code.
A company's sales force consists of its staff of salespeople. The role of the sales force depends to a large extent on whether a company is selling directly to consumers or to other businesses.
The sales forecast is a prediction of a business's unit and dollars sales for some future period of time, up to several years or more. These forecasts are generally based primarily on recent sales trends, competitive developments, and economic trends in the industry, region, and/or nation in which the organization conducts business.
Sales management refers to the administration of the personal selling component of a company's marketing program. It includes the planning, implementation, and control of sales programs, as well as recruiting, training, motivating, and evaluating members of the sales force.
Sales promotion is an important component of a small business's overall marketing strategy, along with advertising, public relations, and personal selling. The American Marketing Association (AMA) defines sales promotion as "media and nonmedia marketing pressure applied for a predetermined, limited period of time in order to stimulate trial, increase consumer demand, or improve product quality." But this definition does not capture all the elements of modern sales promotion.
In the dotcom industry, the ability for a Web site to grow at a rate comparable to that of the business itself is known as scalability. In order to stay competitive, a site must be able to add and drop merchandise and inventory from their online store in a relatively short period of time.
Search engines are online services that allow users to scan the contents of the Internet to find Web sites or specific information of interest to them. A user inputs a search term, and the search engine attempts to match this term to categories or keywords in its catalog of World Wide Web sites.
Seasonal businesses are businesses that operate in one of two common business situations. The first situation is a business that is only open for operations during certain seasons of the year.
Companies that are privately owned are not required by law to disclose detailed financial and operating information in most instances. They enjoy wide latitude in deciding what types of information to make available to the public.
The U.S. Securities and Exchange Commission (SEC) is a federal agency responsible for administering federal securities laws that protect investors.
Seed money, or seed capital, is the financing an entrepreneur needs in the very early stages of launching a new business. It gets its name from the idea that early stage financing plants the seed that enables a small business to grow.
Self-assessment is a tool that involves performing a critical analysis of one's own goals, interests, skills, and experience. Among its many applications in the business world are employee development, team performance, and organizational change efforts.
Self-employment refers to the status of an individual who—rather than accepting a position as an employee of another person or organization—chooses to go into business for him or herself. Self-employment offers individuals a number of advantages, from the freedom to work without supervision to the ability to deduct the costs of doing business for tax purposes.
The Self-Employment Contributions Act (SECA) of 1954 is a tax law that requires the owners of small businesses—such as S corporations, partnerships, and sole proprietorships—to pay a tax of 15.3 percent of their net income from self-employment to cover their own Social Security, Medicare, and Old Age Survivors and Disability Insurance (OASDI) costs. Workers who are employed by a company or another person (rather than being self-employed) only have to pay half this amount, which is withheld from their paychecks.
Many small business owners eventually decide to sell their companies, though the reasons for such divestments vary widely from individual to individual. Some owners may simply wish to retire, while others are impatient to investigate new challenges—whether in business or some other area—or tired of the frustrations of the business in which they find themselves.
Seniority is defined as the length of service by an employee in a continuing or temporary job or position. In some employment situations, time in supplemental positions may be added to an employee's seniority as well.
Service businesses are enterprises that are established and maintained for the purpose of providing services (rather than or in addition to products) to private and/or commercial customers.
The Service Corps of Retired Executives (SCORE) is a national non-profit organization that counsels business owners and aspiring entrepreneurs. There are 389 SCORE chapters throughout the United States offering counseling services to small businesses in all areas at no charge to the client.
Sexual harassment is a term used to describe a variety of illegal discriminatory actions—from un-welcome sexual advances to verbal conduct of a sexual nature—that create a hostile or abusive work environment. The Equal Employment Opportunity Commission (EEOC) defines sexual harassment as follows: "Unwelcome sexual advances, requests for sexual favors, and other verbal or physical contact of a sexual nature constitute sexual harassment when: 1) Submission to such conduct is made either explicitly or implicitly a term or condition of an individual's employment.
Shared services is an operational philosophy that involves centralizing administrative functions that were once performed in separate divisions or locations. Services that can be shared among the various business units of a company include finance, purchasing, inventory, payroll, hiring, and information technology.
Shoplifting is the practice of stealing merchandise from retail establishments. Unfortunately, shoplifting is a serious and persistent problem for most retailers.
Sick leave and personal days are a form of time off afforded to employees who must miss work due to an illness or a personal situation. Since nearly all employees need such time off occasionally, all businesses should have a clear policy established regarding sick leave and personal days.
Simplified employee pension (SEP) plans—also known as SEP/IRAs since they make use of individual retirement accounts—are pension plans intended specifically for self-employed persons and small businesses. Created by Congress and monitored by the Internal Revenue Service, SEPs are designed to give small business owners and employees the same ability to set aside money for retirement as traditional large corporate pension funds.
For many small businesses, business location is an essential component in its eventual success or failure. Site selection can be pivotal in all sorts of businesses, including retail, service, wholesale, and manufacturing efforts.
The Small Business Administration (SBA), which was created in 1953, is an independent federal agency charged with aiding, counseling, and protecting the interests of American small businesses. The agency maintains a wide range of programs designed to address various aspects of this mandate.
Business consortia are alliances of individual business enterprises. These firms are often in the same broad field or industry, though they are rarely in direct competition with one another.
One of many programs administered by the Small Business Administration (SBA), the Small Business Development Center (SBDC) program is intended to provide management assistance to both established and prospective small business owners. The SBA characterizes the program, which was established in 1976, as a "cooperative effort of the private sector, the educational community, and federal, state, and local governments.
The Small Business Innovation Research Program (SBIR) is the federal government's most important research and development funding program for small businesses. It was established by the passage of the Small Business Innovation Development Act of 1982.