A lot of people dream of opening their own company – but first they must discover some helpful terminology. Right here is a short list to help you out!
Any firm exists to produce either a product or a service to then sell it for a profit. A profit is amongst the most basic financial terms and concepts that you will encounter in the corporate world, and in basic terms a profit is gained when the revenues from selling the good or a service exceed the costs involved in its production. If a business goes public, it has to announce its earnings to the public, including its profits, like Nestlé profits for instance. These costs involved in the calculation of the profit can either be fixed or variable, and these are two important financial terms that any businessperson has to be aware of. Fixed costs, as the name suggests, are any costs that don't differ with output, like rent and workers wages; variable costs on the other hand will alter with the volume of output, like the cost of purchasing raw materials for example.
There is no use in making a product if no body is aware of it. To be sure that their target market knows about the existence of their product, firms resort to the help of marketing. Simply put, marketing is the study of a relationship between the manufacturer and the consumer that will help companies put the perfect product on the market, and it is surely amongst the most handy common business terms you will ever come across. Every firm has their own marketing strategy, like Dell marketing strategy as an example.
There are a lot of things going on in the daily life of any firm, be it small or big. Within it there is a number of men and women working in different departments that are in charge of various tasks. Nevertheless to ensure that all of these tasks go according to plan, there is always someone to oversee them. At the lower level you come across your line managers and departmental mangers, who make decisions on an almost day-to-day basis. But as you go higher up the corporate hierarchy you will find men and women like the chief executive or the CFO who are in charge of the whole company and who make decisions that will have a much larger impact on the future of the company they are leading. Many businesses likewise have shareholders, who own shares of that company and consequently have an interest in how the company is run without being immediately involved. To stay informed on how the firm is doing and any new advancements they attend an annual general meeting, or AGM for short, and that is probably one of the most basic business terms you certainly need to be familiar with. Every public firm has to hold one every year, like the Telecom Italia AGM that is always a major occasion for their shareholders. During an AGM, shareholders are presented with an annual report about the company’s performance and strategy.