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Common business acronyms first-time entrepreneurs need to know

Before getting down to the real deal, budding entrepreneurs should learn the basics of business. First off—these acronyms below.
By MJ Dinglasan |
Common business acronyms first-time entrepreneurs need to know

First times are always crucial especially in business. Getting the hang of it takes time and success isn’t achieved overnight. First-time entrepreneurs need to know that building a business is a learning process and is an experience that will eventually teach them how to manage their own. By knowing the basics and every detail that goes along with it, their business will grow and succeed in no time.

Being new to the industry, budding business owners should make themselves familiar with the business language. Part of the learning process is understanding important acronyms that are incorporated in their business generally. These may seem confusing, but knowing them will help beginners achieve their business goals. Below are some of the most common acronyms used in the business industry. Understand these and assess if you’re knowledgeable enough to start your own.

1.    ROI – Return on investment

A profitability measure that evaluates the performance of a business by dividing net profit by net worth. (definition from Entrepreneur.com)

ROI measures the effectiveness of a certain investment. Through this, entrepreneurs can determine if the investment is successful or not. If they get a high return, then that means that the investment gained profit. Tracking the ROI will help you find out what’s good and bad for your business.

2.    B2B – Business to business

It is a term used to define a business transaction made between two companies rather than between a company and its consumer. One example would be a transaction between a garment factory and a clothing company. The garment factory supplies garments to the clothing company, which makes clothes out of those. In this case, the garment factory’s products don’t end up on the consumers, but on another company to produce another form of merchandise.

3.    B2C – Business to consumer

This defines a transaction made between a company and a consumer. These businesses are those that provide products or services directly to the consumers. Some of the examples are restaurants, malls, and banks.  

4.    SEO – Search engine optimization

Since we’re living in the digital age, most businesses have gone digital, too. And one of the most important terms to know is SEO. Search results matter if your business is in the digital phase. SEO is an important business tool that will help your venture land on the first page of results when consumers search for a related product or service. Good content also contributes to a higher ranking in SEO.

5.    IPO – Initial public offering


This term is mainly used in investments. If a company offers an IPO, it means that it’s the first time that company sells its stocks or shares to the public. Most entrepreneurs take this as an opportunity to be a part (somehow) of any publicly listed company. IPO and public listing are among ways for businesses to generate additional capital from interested and willing investors, who usually aim to reap profits in return.

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