Glossary

Cash Flow

Cash flow is the money going both in and out of your business (i.e. money gained via income and money paid for expenses such as rent, taxes, debts, and other various expenses).

Financial Plan

A detailed assessment of your business’s entire engagement with money. This means all income sources, bills, budgets, profits, and so on. A financial plan will also include your predicted profits for the near future.

Market Segment

Sections of your target market that you split according to common traits (i.e. levels of income, location, age, etc).

Overheads

Overheads are ongoing business expenses (that are usually fixed) and do not directly lead to profits. (i.e. rent, maintenance of machinery, etc).

Profit and Loss

A profit and loss statement summarises all of your income and expenses over a period of time (usually a fiscal quarter of a year).

Sales Forecast

A sales forecast is a month-by-month prediction of your sales.

Target Market

The group of customers you wish to sell to.

Gross Profit

This is the difference between the income from your total sales and the cost of producing your goods.

Net Profit

This is your total earnings after all expenses are accounted for. Your net profit is measured quarterly and/or annually.