Resources / Glossary
Business terms, in plain English.
34 definitions in 6 categories. Open a category, then a term for the full explanation, an example and the official source.
Starting up4 terms
- Business modelA business model describes how a business creates value for customers, who those customers are, and how it earns money and covers its costs.
- Minimum viable product (MVP)A minimum viable product is the simplest version of a product or service that real customers can use and pay for, built to test whether a genuine need exists.
- Product-market fitProduct-market fit means a product satisfies a real and sizeable demand in a specific market, shown by customers who buy it, keep using it and recommend it without heavy persuasion.
- Sole traderA sole trader is a self-employed individual who runs a business in their own name.
Companies House and legal5 terms
These terms describe UK company law. Each page notes how the US and EU differ.
- Authorised corporate service provider (ACSP)An authorised corporate service provider (ACSP) is an agent, such as an accountant, solicitor or company formation agent, that is registered with Companies House to act for clients.
- Companies House identity verificationCompanies House identity verification is a UK requirement for company directors and people with significant control to prove who they are.
- Confirmation statementA confirmation statement is an annual filing that a UK company makes to Companies House to confirm that the information held about it is correct.
- Person with significant control (PSC)A person with significant control is someone who ultimately owns or controls a UK company, for example by holding more than 25 per cent of its shares or voting rights, or by being able to appoint or remove a majority of its directors.
- Registered office addressA registered office address is the official address of a UK company, where legal notices and official post can be sent.
Money7 terms
- Break-even pointThe break-even point is the level of sales at which total revenue equals total costs, so the business neither makes a profit nor a loss.
- Cash flowCash flow is the movement of money into and out of a business over a period.
- Contribution marginContribution margin is what each sale leaves over after the variable costs of making that sale, the amount it contributes towards fixed costs and then profit.
- Customer concentrationCustomer concentration is how much of a business's revenue comes from a small number of customers.
- Gross marginGross margin is the share of revenue left after the direct costs of making or delivering a product or service.
- Payback periodThe payback period is how long an investment takes to earn back what it cost.
- Working capitalWorking capital is the money a business has available to fund its day-to-day operations.
Operations7 terms
- BottleneckA bottleneck is the step in a process with the lowest capacity, which limits how much the whole process can produce.
- Business process reviewA business process review is a structured look at how work actually gets done in a business, from first request to finished result.
- Fractional project managerA fractional project manager is an experienced project manager who works for a business part-time, for example one or two days a week, rather than as a full-time employee.
- Process mappingProcess mapping is drawing out how a piece of work actually moves through a business, step by step, from the first trigger to the finished result.
- Programme managementProgramme management is the coordinated management of several related projects, together with day-to-day business activity, to achieve a larger change.
- Single point of failureA single point of failure is any one person, supplier, system or customer whose loss would stop or seriously damage a business, because nothing else can step in.
- Standard operating procedure (SOP)A standard operating procedure is a written, step-by-step description of how a routine task should be done, so that it is performed the same way every time.
Marketing and search4 terms
- Conversion rateConversion rate is the percentage of people who take a desired action out of everyone who had the chance, such as buying, signing up or making an enquiry.
- Customer acquisition cost (CAC)Customer acquisition cost is the average amount a business spends to win one new customer.
- Ideal customer profile (ICP)An ideal customer profile is a description of the type of customer a business serves best and most profitably.
- Search engine optimisation (SEO)Search engine optimisation is the practice of making a website easier for search engines to understand and for people to find through search.
Technology and AI7 terms
- AI readinessAI readiness is how prepared a business is to use artificial intelligence on real work and get a measurable result.
- Custom softwareCustom software is software designed and built for the specific needs of one organisation, instead of being bought as a ready-made product.
- Data portabilityData portability is the ability to obtain your data from one service in a structured, commonly used, machine-readable format and move it to another.
- Data readinessData readiness is whether the information a business wants to use, for reporting, automation or AI, is accurate, complete, in one place the right people can reach, and handled lawfully.
- Generative AIGenerative AI is a type of artificial intelligence that creates new content, such as text, images, audio or code, in response to a prompt.
- Total cost of ownership (TCO)Total cost of ownership is everything a system or asset costs over its whole life, not just the price to buy it: setup, running costs, maintenance, training, upgrades and the cost of the work it leaves behind, until the day it is retired or replaced.
- Vendor lock-inVendor lock-in is a situation where a business depends so heavily on one supplier's product or service that switching to another would be costly, slow or technically difficult.
How we write these: the answer comes first, examples are plain, and each term is checked against official or recognised sources where they exist, with the date we checked. Legal terms are re-checked when the rules change. How we write these.