10 Vital Business Words and Their Meanings
Important terminology you need to know as a professional
The Magic of Words
Words are sometimes referred to as ‘spells’. Yes, you’re right to assume we are talking about magic spells. We wanted to point out this quality of words because they truly are magical in a sense of the transformation they can create. Through communication, we are able to understand others, convey new ideas, and do business with people around us. Otherwise, it would be rather difficult to even start an agreement.
Vocabulary, however, does vary across different cultures, social groups, and industries. That is why, with the intention of bringing you ‘up to speed’ with the business world vocabulary, we’ve created a list of the 10 most important terms you should know. If you want to play in the professional league, you have to know what other players are talking about. Become familiar with these terms, use them often, and thrive within the business dimension!
As an entrepreneur or a business owner, you have to know this word. It is especially important to remember that without stakeholders there would be no mission a business could pursue.
It means a group within or outside the organisation, that depends on the organisation’s performance. In other words, your business will affect these people’s lives. One way or another.
We wanted to point this word out to you early on, as there is often confusion when this term is mentioned. Remember that it does not mean a social gathering.
The meaning of ‘party’ in the business world refers to any person or a group involved in legal proceedings. For example, when you’re signing a contract with your employer, both of you are separate ‘parties’ that the agreement binds.
Above, we’ve mentioned this word and it seems only fair to mention it here. It is one of the most popular words, regardless of the kind of industry.
A contract is an agreement between two or more ‘parties’ that is enforceable by law. It simply is the document that allows both sides to keep each other accountable. Please note that the safest kind of contract is written down and signed by both parties.
As an entrepreneur, you will have to deal with many different circumstances. Some clients might be easier to communicate with, some might be almost impossible to reach. Either way, you have to make sure that both parties (you included) know what the terms of the agreement are.
The terms of either a contract, employment, or project delivery are simply various conditions attached to these agreements. In other words, through discussing the terms you state the boundaries of your cooperation.
We’ve decided to introduce this word in conjunction with the term ‘profit’. As you’ll see below, the two have a lot to share.
Revenue is the entire amount of income before any deductions are made. In other words, your business revenue comprises all incoming assets, even though it might not mean you’re actually gaining any profit.
You might already have some assumptions about the meaning of this term. This is, ultimately, what any business venture is all about. People might want to make a change or improve the world, but without profit, any entrepreneurial adventure is a fleeting illusion.
Profit can be counted, when you deduct your expenses and taxes from the revenue. It is the amount of money left over after all of the deductions are made. It is where your financial gain takes place.
7. Cash Flow Statement
Like any statement (and there are a lot of them in business), it is a document that keeps your company or self-employment in check. It is as useful for an individual as it is for a huge corporation.
A cash flow statement is a financial statement that presents the flow of money in and out of the business. To put it in more simple terms, it is a file that shows your current financial position and can be treated as proof of lawful behaviour. It is very important to have one, especially at the end of the tax year.
This word has emerged on the wave of digitalisation, but its essence has been around humankind for as long as we could remember. It is as much a term as it is a skill and mastering it can greatly empower your business opportunities.
Networking means using contacts with friends, family members, or social media acquaintances to find business-related opportunities. With the use of networking, you can find a new job or recruit a professional for the role you have to fill.
This term is closely related to networking. A commonly used word, especially within the entrepreneurial and freelancing sphere of the marketplace.
To outsource means to delegate selected functions or activities of an organisation to another party, which can perform them more efficiently. Often used to cut costs or save precious time.
We’ve decided to leave this one for the end, as it is likely to be the most important one for yourself as an entrepreneur or a business owner. A term that comprises many facets of the business.
Branding combines the name, words, symbols, and/or designs that identify the product and the company. With the use of branding strategy, a business can distinguish itself from the competition and earn recognition on the market. Note that almost everything public-facing could be considered a part of the brand.
The Greatest Weapon
Words can change history, initiate wars, or promote change for the better. With words, one can truly transform their world. That is why, with the list of the terms above, we would like to encourage you to learn more meaningful vocabulary and use it often. At Revolancer, we value communication and recognise its importance in everyday life and business. We wish that through the proper use of the terminology you will be able to achieve greater success and thrive in your industry.
It is not by coincidence that the greatest speakers of our world were often the leaders of their communities. People like Martin Luther King, Gandhi, or Aristotle are only a few examples of individuals, who through articulate rhetoric moulded the world into a better space. So, do not take words for granted, learn daily, and use the power of words to thrive in business and life.
Before You Go
Freelance marketplace: Revolancer