Glossary

Small Business Glossary

Every term here comes with a working calculator, so you leave with your number rather than someone else's definition. Nothing is gated.

All terms

• Customer Acquisition Cost (CAC)Customer acquisition cost is what you spend, on average, to win one new customer.
• Average TicketAverage ticket is what a typical customer or job brings in before costs.
• Customer Lifetime Value (LTV)Customer lifetime value is everything one customer pays you across the whole relationship, not just the first sale.
• Repeat RateRepeat rate is the share of your customers in a period who had bought from you before.
• LTV to CAC RatioThe LTV to CAC ratio compares what a customer is worth to what they cost to win.
• Conversion RateConversion rate is the share of people who take the action you want.
• Payback PeriodPayback period is how long it takes a new customer to pay back what they cost to acquire.
• Effective Hourly RateYour effective hourly rate is what an hour of your own time is actually worth to the business.
• Gross MarginGross margin is the share of revenue left after the direct cost of delivering the work.
• Break-Even PointYour break-even point is how much you must sell to cover all your costs.
• Churn RateChurn rate is the share of customers who stop buying from you over a period.
• Marketing BudgetA marketing budget is the amount you commit to winning customers over a period, usually set as a share of revenue.
• Local VisibilityLocal visibility is how easily someone nearby can find you when they search for what you sell.
• Price Increase ImpactA price increase raises revenue on every sale without costing anything to acquire.