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These days, acronyms are being used practically everywhere. You probably see or hear shortened forms of words or phrases when you peruse social media posts, watch sporting events on television, or walk through your office. Acronyms are easier to say, and contrary to popular belief, they are not surging in popularity because of the younger generation. Acronyms have been around for decades and are used in all business-related industries. If you are not as “acronym-savvy” as your peers or colleagues, here’s a quick primer from Balboa Capital. We compiled a list of 10 business acronyms you should know.
1. SWOT
A SWOT analysis is an essential strategy businesses use during the planning and marketing stages to help them develop a competitive position in the marketplace. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats related to business competition. The SWOT analysis dates back to the 1970s; it remains a “go-to” tactic for business planning due to its usefulness and effectiveness.
2. SBA
Of all the acronyms on this list, the SBA is probably the one you are most familiar with. The SBA stands for the Small Business Administration, formed in 1953 to help small businesses acquire loans, government contracts, and other assistance methods needed for growth.
3. OSHA
OSHA stands for the Occupational Safety and Health Administration, formed in April 1971. If your business has one or more employees, it must comply with OSHA regulations designed to keep work environments safe for workers. OSHA is a federal law, but some states have their own OSHA laws. You can find out if your state is on the list by visiting the U.S. Department of Labor’s OSHA website.
4. P&L
“Get me a P&L report” is a common request business owners ask of their accountants. A P&L report, also referred to as a P&L statement, is an overview of your small business’s profits and losses during a specific period. You most likely look at your quarterly profit and loss statements to evaluate how well your business is performing based on its revenues and expenses.
5. CAN-SPAM
You must adhere to CAN-SPAM laws if you contact customers, vendors, or prospects via email. CAN-SPAM stands for Controlling the Assault of Non-Solicited Pornography and Marketing, signed into law in 2004. Before deploying an email campaign for your business, contact a business attorney to learn more about CAN-SPAM laws.
There are strict rules and content guidelines for commercial email messages, and you must give the recipient the option to “opt out” at any time. Not following these rules violates the CAN-SPAM law and can result in huge fines by the Federal Trade Commission.
6. EBITDA
This business acronym sounds complicated, but it is a relatively easy formula for measuring your small business’s operating performance and ability to generate cash flow. EBITDA stands for earnings before interest, taxes, depreciation, and amortization. EBITDA is one of the most popular measures used by small businesses, middle-market companies, and large corporations.
7. CMS
You use a content management system (CMS) if your small business has a website or blog. A CMS is a software or web-based platform used to create, edit, archive, and publish content on the web. This includes website pages, blog posts, press releases, videos, whitepapers, and infographics.
8. SEO
Think your business’s website will magically get traffic on its own? Think again. Many search engine optimization (SEO) strategies and techniques can influence the number of visitors your website receives.
SEO is the cornerstone of your digital strategy; it encompasses keyword research, copywriting, website design, blogging, internal and external linking, and social media to maximize traffic to your site and improve page rank within the top search engines. You cannot afford to cut corners with your SEO efforts. Hire an SEO specialist, preferably one with extensive analytics experience.
9. SEM
Are you considering buying paid advertising online? This is referred to as search engine marketing or SEM. Like SEO, it is an involved process requiring an experienced professional. Look for an SEM specialist certified in paid advertising.
This individual will evaluate your marketing goals and develop an SEM campaign based on your budget, paid search trends, and cost-per-click (CPC). Once your SEM campaign launches, your SEM specialist will need to monitor it daily and weekly and provide you with the results and recommended changes.
10. ROI
You are in business to make money, plain and simple. Every business decision is designed to help you generate revenues and profit. You can evaluate the performance of your business investments by calculating their return on investment (ROI). The ROI formula is simple. Just divide your net profit by the cost of investment.
For example, if you invested $50,000 in a new piece of machinery that generated $200,000 in net profit, your investment gain is $150,000, and your ROI is 300%.
We hope you enjoyed reading this information about commonly used business acronyms. In addition, our small business blog has articles that discuss several other business acronyms, such as NAICS, DBA, and ROA, and we will continue adding more for our readers.
Balboa Capital, a Division of Ameris Bank, is not affiliated with nor endorses the Small Business Administration, Occupational Safety and Health Administration, Federal Trade Commission, or U.S. Department of Labor. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.