Glossary of Business Terms
Accrual
The method of accounting in which you match revenue with expense regardless of when the cash may or may not be collected.
Alt Tags
A means for creating text for images by describing in words what a picture depicts.
ASAP
As Soon As Possible
Balance Sheet
A “point-in-time” snapshot listing all of your assets as well as your liabilities.
BPA
Business Process Automation
Business Process
A series of steps to perform a function..
BPsass
Business Process Software As a Service
Business Model
A method of how a company generates revenue.
Business Plan
A written outline that evaluates all aspects of your business.
Business Profile
A concise definition and description of your intended business, and how you plan to go about it.
CAM
Computer Aided Manufacturing.
Capital
The funds and assets invested in a business by the owners.
Capitalization Rate
The desired return (profile) you desire to determine the valuation of a business, expressed as a percentage return on your investment.
Cash Basis of Accounting
Method of accounting in which you recognize income when you receive the cash, and expense when you receive the bill.
Cash Flow Control
A simple method of projecting your future needs for cash.
Category Killer
Large discount chains with powerful buying power and efficiencies of scale.
Certificate of Insurance
Your landlord or you – it needs to be done.
Commodity Business
A business for which you must have the lowest cost to survive.
Compounding
The ability of an asset to generate earnings which are then reinvested in order to generate their own earnings. In other words, compounding refers to generating earnings from previous earnings. (Interest is added to principal so that the interest that has been added also earns interest).
Current Liability
A debt due in less than 12 months.
Deal Point
A non-negotiable condition; no transaction can be closed without including it.
Demographic Report
Population statistics based on census data.
Depreciation
A non-cash expense of doing business (such as recording that assets are going down in value over time)
Domain Name
The unique name that identifies you to all the other computers on the Internet. (Your website name URL)
Due Diligence
The overall process of evaluating a business opportunity including examination of financial records.
E-commerce
The sale of products and services over the Internet.
Entrepreneur
One who organizes, operates, and assumes the risk in a business.
Equity
An ownership interest in a business.
FAQ
Frequently asked questions.
Goodwill
The value of a company’s reputation which gives it a competitive edge and earning power. An intangible asset of a business derived from the perceived value of the business’ assets.
Hollow Corporation
A business in which important elements are outsourced to subcontractors.
HR Department
Human Resources Department including payroll functions and training.
HTML
Hypertext Markup Language: the common language of the Internet.
Income Statement
Also known as “profit and loss statement”. Shows income and expenses and resulting profit or loss over a specified period of time.
Independent Contractor
Someone who is retained to perform a certain act but who is not an employee. An independent contractor pays all their own expenses, taxes and receives no employee benefits.
Internal Controls
What is needed to avoid losses in the handling of funds: either cash, checks, or credit cards.
Intrinsic Valuation
The value of a business based on a mathematical calculation which converts all estimated future earnings to their present value.
IPO
Initial Public Offering (the first public issuance of stock in a company).
Just-In-Time
The controlling of inventory so that materials are delivered just-in-time for assembly or manufacture.
Links
Links to and from other websites help create more ways for people to arrive at your website. The World Wide Web refers to the web these links create.
Liability Insurance
Insurance for damage or loss that may be caused by the policyholder on another person in form of bodily injury or property damage.
Liquidity
Money in the bank i.e. sufficient cash to pay your bills and payroll on time.
Meta Tags
Information inserted into the “head area” of your web pages.
Moonlighting
Operating a business while still employed. “In the moonlight” - a part-time business.
Options
Most commonly refers to a legal right to convey a property or share.
Outsourcing
The practice of using subcontractors rather than paid employees.
Payroll Service Provider
An outside resource to take over payroll and other employee-related functions.
Percentage Rent
A rental charge that is based on a percentage of your sales.
Pilot Operation
A small-scale operation to evaluate and test the merits of a business concept.
Pricing Power
Unique qualities that enable maintenance of profitable pricing.
Profit Center
A unit of a business that can be compartmentalized financially such as an individual store within a chain.
Retained Earnings
Cumulative net earnings or profit after accounting for dividends. They're also referred to as the earnings surplus.
RPA
Robotic Process Automation
SEO
Search Engine Optimisation. Enhancement methods used to improve website rankings on search engines
Secured Credit
Loans secured by the assets of your business or your personal assets or both.
Shrinkage
Loss of goods through shoplifting and other types of stealing.
Site Criteria
Factors making up the overall and objective evaluation of a location for a specific business.
Unsecured Credit
Loans for which there is no collateral granted to the lender.