100 Business Terms Every Professional Must Know

Doing business without an understanding of the vocabulary used throughout it is like trying to navigate a ship without a sextant. Whether one is a battle-hardened veteran or an undecided freshman, knowing key business terms is important for effective communication, strategic thinking, and success in general. This list of 100 business terms and their definitions prepares one with words that set up a person for success in any professional setting.

Financial Terms:

1. Accounts Payable (AP): The money a company owes to suppliers for goods or services received on credit.
2. Accounts Receivable (AR): The money owed to a company by customers for goods or services purchased on credit.
3. Asset: A resource with economic value owned by a business that can be converted into cash. (e.g., property, equipment, inventory)
4. Balance Sheet: A financial statement that provides a snapshot of a company’s financial health at a specific point in time, showing its assets, liabilities, and shareholder equity.
5. Break-Even Point: The point at which a company’s total revenue equals its total expenses, resulting in neither profit nor loss.
6. Capital: The financial resources used by a business to operate and grow. (e.g., cash, equipment, buildings)
7. Cash Flow: The movement of cash in and out of a business over a specific period.
8. Cost of Goods Sold (COGS): The direct costs associated with producing the goods a company sells.
9. Depreciation: The gradual decrease in the value of an asset over time due to wear and tear, obsolescence, or other factors.
10. Equity: The ownership interest shareholders have in a company, calculated as total assets minus total liabilities.
11. Fixed Costs: Business expenses that remain constant regardless of production volume. (e.g., rent, salaries)
12. Gross Profit: The total revenue minus the COGS.
13. Income Statement (Profit & Loss Statement): A financial statement that summarizes a company’s revenues, expenses, and net income over a specific period.
14. Liability: A financial obligation a company owes to another party, such as a debt or unpaid taxes.
15. Liquidity: The ease with which an asset can be converted into cash.
16. Margin: The difference between the revenue from selling a good or service and its associated costs, expressed as a percentage. (e.g., profit margin, gross margin)
17. Net Income (Profit): The total revenue minus all expenses incurred during a specific period.
18. Return on Investment (ROI): A performance measure used to evaluate the efficiency of an investment or project, expressed as a percentage.
19. Working Capital: The difference between a company’s current assets (cash, inventory, accounts receivable) and its current liabilities (accounts payable, short-term debt).

Marketing & Sales Terms:

20. B2B (Business-to-Business): A marketing and sales model where businesses sell products or services to other businesses.
21. B2C (Business-to-Consumer): A marketing and sales model where businesses sell products or services directly to individual consumers.
22. B2G (Business-to-Government): A marketing and sales model where businesses sell products or services to government agencies.
23. Brand: The unique identity of a product, service, or company.
24. Buyer Persona: A semi-fictional representation of a company’s ideal customer, including demographics, behaviours, and needs.
25. Conversion Rate: The percentage of website visitors or leads who take a desired action, such as making a purchase or signing up for a newsletter.
26. CRM (Customer Relationship Management): A software system that helps businesses manage interactions with customers and prospects.
27. Direct Marketing: A targeted marketing approach that involves communicating directly with potential customers through various channels like email, telemarketing, or direct mail.
28. Inbound Marketing: A strategy that attracts customers by creating valuable content and experiences that draw them to a company.
29. Lead: A potential customer who has shown interest in a company’s product or service.
30. Marketing Mix (4Ps): The four key elements of a marketing strategy: product, price, place (distribution), and promotion.
31. Market Research: The process of collecting and analysing data about a target market to understand customer needs and preferences.
32. Market Share: The percentage of the total sales revenue in a market that a specific company captures.
33. Sales Funnel: The journey a potential customer takes from initial awareness of a product or service to becoming a paying customer.
34. Sales Pipeline: A visual representation of the sales process, tracking potential customers through various stages of qualification.
35. SEO (Search Engine Optimization): The practice of improving the ranking of a website on search engine results pages (SERPs) to increase organic traffic.
36. Social Media Marketing: Utilizing social media platforms to connect with customers, build brand awareness, and drive sales.
37. SWOT Analysis: A strategic planning framework that helps businesses evaluate their Strengths, Weaknesses, Opportunities, and Threats.
38. Target Market: A specific group of customers a company aims to reach with its marketing and sales efforts.
39. Unique Selling Proposition (USP): A distinct advantage that sets a company’s product or service apart from competitors.
40. Viral Marketing: A marketing strategy that encourages rapid online sharing of content or messages, leveraging consumer networks.

Management & Operations Terms:

41. Delegation: Assigning tasks or responsibilities to others while maintaining accountability for the outcome.
42. Employee Engagement: The level of commitment and enthusiasm employees have towards their work and their company.
43. Human Resources (HR): The department responsible for managing a company’s workforce, including recruitment, training, and employee relations.
44. KPI (Key Performance Indicator): A measurable value that reflects a company’s progress toward achieving its goals.
45. Leadership: The ability to influence, motivate, and guide others towards a common goal.
46. Management: The process of organizing and coordinating resources to achieve a business objective.
47. Outsourcing: Contracting with an external provider to perform specific tasks or services.
48. Performance Management: The continuous process of setting goals, evaluating employee performance, and providing feedback.
49. Project Management: The application of knowledge, skills, tools, and techniques to effectively complete projects within a defined timeframe, budget, and scope.
50. Stakeholder: An individual or group with an interest in a company’s success, such as shareholders, employees, customers, and suppliers.

Strategy & Growth Terms:

51. Benchmarking: Comparing a company’s performance metrics against those of competitors or industry leaders.
52. Blue Ocean Strategy: A strategic approach focused on creating uncontested market space by differentiating from existing competitors.
53. Business Model: A framework outlining how a company creates, delivers, and captures value for its customers.
54. Competitive Advantage: A factor that gives a company an edge over its competitors in the market.
55. Core Competency: A specialized skill or capability that sets a company apart from competitors and contributes significantly to its competitive advantage.
56. Disruptive Innovation: Innovation that significantly alters the way an industry functions and creates new value networks.
57. Entrepreneurship: The process of starting a business and taking on the risks associated with it.
58. First Mover Advantage: The competitive advantage enjoyed by a company that is the first to enter a new market.
59. Merger & Acquisition (M&A): A strategic transaction where two companies combine through a merger or one company acquires another.
60. Scalability: The ability of a business to efficiently increase its output to meet growing demand without significant changes in cost or structure.

Accounting & Finance Terms:

61. Accrual Accounting: A method of accounting that recognizes revenue when it is earned and expenses when they are incurred, regardless of cash flow.
62. Double-Entry Bookkeeping: A system of bookkeeping that records every financial transaction twice, once in a debit account and once in a credit account.
63. Earnings Per Share (EPS): A company’s profit divided by the number of outstanding shares, indicating profit allocated to each share of stock.
64. Financial Statements: Documents that summarize a company’s financial performance and position, including the balance sheet, income statement, and cash flow statement.
65. General Ledger: The central record of all financial transactions for a company.
66. Inventory Turnover Ratio: A metric that measures how often a company sells and replaces its inventory over a given period.
67. Net Present Value (NPV): A method of evaluating the profitability of an investment by considering the time value of money.
68. Prepaid Expense: An expense paid for in advance of when it will be used or consumed.
69. Revenue: The income generated from the sale of goods or services.
70. Corporate: Governance: Policies and practices for company management.

Business Technology Terms:

71. Big Data: Large and complex datasets that are analyzed to uncover hidden patterns, trends, and insights.
72. Block Chain: A secure, distributed ledger technology that enables the recording of transactions and tracking of assets in a transparent and verifiable way.
73. Cloud Computing: On-demand delivery of IT resources like servers, storage, databases, networking, software, and analytics over the internet.
74. Cybersecurity: The practice of protecting computer systems, networks, and data from unauthorized access, use, disclosure, disruption, modification, or destruction.
75. Data Analytics: The process of examining, transforming, and cleansing data to identify useful information, inform conclusions, and support decision-making.
76. Enterprise Resource Planning (ERP): A software system that integrates core business processes like accounting, human resources, manufacturing, and supply chain management.
77. Internet of Things (IoT): A network of physical devices embedded with sensors, software, and other technologies that allows them to collect and exchange data.
78. Machine Learning: A type of artificial intelligence (AI) that enables systems to learn and improve from data without being explicitly programmed.
79. SaaS (Software as a Service): A software delivery model where applications are hosted by a vendor and accessed over the internet on a subscription basis.
80. UX/UI Design: User experience (UX) design focuses on creating a positive and user-friendly experience for users interacting with a product or service. User interface (UI) design deals with the visual elements and layout of a product or service.

Business Communication & Legal Terms:

81. Contract: A legally binding agreement between two or more parties outlining rights and obligations.
82. Intellectual Property (IP): Intangible creations of the human mind, including inventions, literary and artistic works, designs, and symbols.
83. Negotiation: The process of discussing and reaching agreement on a common course of action, often involving compromise.
84. Non-Disclosure Agreement (NDA): A legal contract that protects confidential information disclosed by one party to another.
85. Presentation: A formal or informal speech accompanied by visual aids to convey information or persuade an audience.
86. Public Relations (PR): The practice of managing the spread of information about a company or organization to influence public perception.
87. Stakeholder Communication: The ongoing process of sharing information and engaging with stakeholders to keep them informed about a company’s activities and goals.
88. Teamwork: The collaborative effort of a group to achieve a common objective.
89. Verbal Communication: The exchange of information through spoken words.
90. Written Communication: The exchange of information through written words or text.
91. Business Jargon & Phrases:

91. Blue-Sky Thinking: A brainstorming session focused on creative and innovative ideas without limitations.
92. Bottom Line: The net profit of a company. 93. Buy-In: Securing agreement and support from stakeholders for a proposal or idea.
93. Closing the Deal: Successfully completing a sale or agreement.
94. Going the Extra Mile: Exceeding expectations by putting in extra effort.
95. Low-Hanging Fruit: Easy to achieve tasks or goals.
96. Moving the Needle: Making significant progress towards a goal.
97. Out of the Box Thinking: Unconventional and creative thinking approaches.
98. Synergy: The combined effect of two or more things that is greater than the sum of their individual effects.
99. Think Tank: A group of experts brought together to address a specific challenge or generate new ideas.
100. Value Proposition: A clear and concise statement that explains the specific benefits a customer will receive from a company’s product or service. It highlights how the offering solves a customer’s problem or fulfils their needs.