Business Definitions – I

ideas vs opportunities – Ideas are the basis of potential business opportunities. Good ideas do not necessarily represent good opportunities.

impressions – An impression occurs each time an advertisement is seen by a potential customer. For example, in online marketing, an impression happens when an advertisement such as a banner ad loads on a user’s screen, whether for the first time, when returning to a page, or when the ad cycles through dynamically.

income statement – Also called Profit and Loss statement. An income statement is a financial statement that shows sales, cost of sales, gross margin, operating expenses, and profits or losses. Gross margin is sales less cost of sales, and profit (or loss) is gross margin less operating expenses and taxes. The result is profit if it’s positive, loss if it’s negative.

Initial Public Offering (IPO) – A corporation’s initial efforts of raising capital through the sale of securities on the public stock market.

innovation (evolutionary or revolutionary) – The determination if an innovation is a “new and improved” concept taken to the next level (evolutionary), or the rare innovation that revolutionizes a technology or concept to the product or services.

innovators – One type of adopter in Everett Rogers’ diffusion of innovations framework describing the first group to purchase a new product or service.

integrated marketing communications – The practice of blending different elements of the communication mix in mutually reinforcing ways.

intensive distribution – A distribution strategy whereby a producer attempts to sell its products or services in as many retail outlets as possible within a geographical area without exclusivity.

interest expense – Interest is paid on debts, and interest expense is deducted from profits as expenses. Interest expense is either long-term or short-term interest.

intrapreneurship – Entrepreneurial-based activities within a corporation that receive organizational support and resources commitments for the purpose of an innovative new business experience within the organization itself.

inventory – Goods in stock, either finished goods or materials to be used to manufacture goods.

inventory turnover – Total cost of sales divided by inventory. Usually calculated using the average inventory over an accounting period, not an ending-inventory value.

inventory turns – Inventory turnover (above). Total cost of sales divided by inventory. Usually calculated using the average inventory over an accounting period, not an ending-inventory value.

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