Zero-based budgeting is a budgeting method in which every expenditure has to be justified from scratch - regardless of the previous year's figures. Instead of simply updating existing budgets, the planning process starts from scratch. The aim is to utilise resources more efficiently and avoid unnecessary costs.
Production costs are all expenses directly associated with the production of a product - these include material costs, production wages and overheads for machinery, energy and administration. They form the basis for the calculation of sales prices and the valuation of inventories in the balance sheet.
The safety margin refers to the distance between the actual value of a company or project and the point at which losses would occur. It serves as a buffer to minimise risks and compensate for financial fluctuations. A larger safety margin increases the likelihood that the company will remain profitable even in difficult times.
Financial leverage refers to the use of borrowed capital to finance investments in order to increase the return on equity. By using borrowed funds, companies can make larger investments than would be possible with pure equity. However, the risk increases, as high debt can also lead to higher financial burdens in the event of losses.
Dynamic pricing is a pricing strategy in which prices for products or services are adjusted in real time based on various factors such as demand, supply, competition and customer behaviour. This method enables companies to maximise their revenue by adapting pricing to market conditions and customer preferences.
Cost-plus pricing is a pricing strategy in which the sales price of a product or service is based on the production costs to which a fixed margin is added. This method ensures that all costs are covered and a profit is made. It is easy to apply, but may not take into account market conditions and the competitive landscape.
The product life cycle describes the various phases that a product goes through in the market - from market launch to growth, maturity and saturation through to decline. Each phase brings with it different challenges and strategies, for example in terms of marketing, pricing or further development. Analysing the life cycle helps companies to manage products in a targeted manner and introduce innovations in good time.
Customer experience (CX) describes the entire experience that customers have with a company across all contact points - from the first interaction to after-sales service. A positive CX is created through consistent communication, user-friendly processes and emotional loyalty. The aim is to increase customer satisfaction and build long-term relationships.
The Net Promoter Score (NPS) is a key figure for measuring customer satisfaction and loyalty. It is based on the question of how likely it is that customers would recommend a company to others - on a scale of 0 to 10. Depending on the answer, respondents are categorised into promoters, passives and detractors. The NPS results from the proportion of promoters minus the proportion of detractors.