BUSINESS TERMS

Business Term With Ufak's Innovative Ideas 

---

To start and run a business, you often need to understand business terms that may not be well defined in a standard dictionary. Our glossary of business terms provides definitions for common terminology and acronyms in business plans, accounting, finance, and other aspects of small business.

Accounts Payable 

(AP)  Bills to be paid as part of the normal course of business. This is a standard accounting term, one of the most common liabilities, which normally appears in the Balance Sheet listing of liabilities. Businesses receive goods or services from a vendor, receive an invoice, and until that invoice is paid the amount is recorded as part of “Accounts Payable.”

Accounts recievable (AR) 

Debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid. The standard procedure in business-to-business sales is that when goods or services are delivered the come with an invoice, which is to be paid later. Business customers expect to be invoiced and to pay later. The money involved goes onto the seller’s books as accounts receivable, and onto the buyer’s books as accounts payable.

Accrual-Based Accounting 

Standard business accounting, which assumes there will be Accounts payable (Bills to be paid as part of the normal course of business) and/or sales on credit (Sales made on account; shipments against invoices to be paid later) , as opposed to Cash-Basis only.

Adventure Capital 

Capital needed in the earliest stages of the venture’s creation before the product or service is available to be provided.

Advertising Opportunity

A product or service may generate additional revenue through advertising if there is benefit from creating additional awareness, communicating differentiating attributes, hidden qualities or benefits. Optimizing the opportunity may involve leveraging strong emotional buying motives and potential benefits.

Agent

A business entity that negotiates, purchases, and/or sells, but does not take title to the goods.

Assets

Property that a business owns, including cash and receivables, inventory, etc. Assets are any possessions that have value in an exchange. The more formal definition is the entire property of a person, association, corporation, or estate applicable or subject to the payment of debts.

Brand 

A name, term, sign, symbol, design, or a combination of all used to uniquely identify a producer’s goods and services and differentiate them from competitors.

V/S

Brand Equity 

The added value a brand name identity brings to a product or service beyond the functional benefits provided.

Brand Extension Strategy 

The practice of using a current brand name to enter a new or different product class.

Brand Recognition

 is extent to which a consumer can correctly identify a particular product or service just by viewing the product or service's logo, tag line, packaging or advertising campaign.

Broker 

An intermediary that serves as a go-between for the buyer or seller.

Bundling

 The practice of marketing two or more product or service items in a single package with one price.

Business Mission

A brief description of an organization’s purpose with reference to its customers, products or services, markets, philosophy, and technology.

Business Plan 

The written document that details a proposed or existing venture (course of action.). It seeks to capture the vision, current status, expected needs, defined markets, and projected results of the business. A business plan “tells the entrepreneur’s story” by describing the purpose, basis, reason and future of the venture.

Co-Branding

The pairing of two manufacture’s brand names on a single product or service.

                            

Payroll

 the total amount of money that a company pays to its employees.Wages, salaries,bonuses,employee compensation, etc.

Commission

 In business, a commission is the compensation paid to the person or entity based on the sale of a product; commonly calculated on a percentage basis.

Telemarketing A form of direct marketing that uses the telephone to reach potential customers.

Direct Mail Marketing 

A form of direct marketing that involves sending information through a mail process, physical or electronic, to potential customers.

 Direct Marketing Any method of distribution that gives the customer access to an organization’s products and services without intermediaries; also, any communication from the producer that communicates with a target market to generate a revenue producing response.

Depreciation 

An accounting and tax concept used to estimate the loss of value of assets over time. For example, cars depreciate with use.

Labor

Work, especially physical work

Laborer 

A person doing unskilled manual work for wages

Stock Market 

The organized trading of stocks, bonds, or other securities, or the place where such trading occurs.

Dividends 

Money distributed to the owners of a business as profits.

SWOT analysis 

A study undertaken by an organization to identify its internal strengths and weaknesses, as well as its external opportunities and threats.

Expense 

Websters calls it “a spending or consuming

Earnings 

Also called income or profits

Competitive Advantage

 The strategic development where customers will choose a firm’s product or service over its competitors based on significantly more favorable perceptions or offerings.

Goodwill 

 the amount of value or image that a company's good reputation adds to its overall value

Entrepreneur

 Someone who starts a new business venture; someone who recognizes and pursues opportunities others may not see as clearly, and finds the resources necessary to accomplish his or her goals.

Equity 

Business ownership; capital. Equity can be calculated as the difference between assets and liabilities

Inventory

Goods in stock, either finished goods or materials to be used to manufacture goods

Invention 

 the action of inventing something, typically a process or device

Innovation 

A new method, idea, product, etc

---