Business Glossary - P


Partnering - A mutually beneficial business-to-business relationship based on trust and commitment and that enhances the capabilities of both parties.

Partnership - A legal relationship existing between two or more persons contractually associated as joint principals in a business.

Patent - A patent secures to an inventory the exclusive right to make, use and sell an invention for 17 years. Inventors should contact the U.S. Department of Commerce Patent Office.

Petty Cash Fund - fixed fund used to make small payments without having to write a check or use credit. The total of the unspent petty cash and the amount in receipts should equal the fixed amount of the fund.

Prime Contract - A contract awarded directly by the Federal government.

Prime Rate - Interest rate which is charged business borrowers having the highest credit ratings, for short term borrowing.

Principal - amount owed on a loan not including interest.

Pro Forma - financial planning statement that projects future performance.

Pro-Net - An Internet-based database of information of small, disadvantaged, 8(a) and women-owned businesses seeking procurement contracts.

Product Liability - Type of tort or civil liability that applies to product manufacturers and sellers.

Professional And Trade Associations - Non-profit, cooperative and voluntary organizations that are designed to help their members in dealing with problems of mutual interest. In many instances professional and trade associations enter into an agreement with SBA to provide volunteer counseling

Profit-Sharing Plan - An employee benefit plan established and maintained by an employer whereby the employees receive a share of the profits of the business. The money may be paid directly to the employee, deferred until retirement, or a combination of both approaches.

Proprietorship - The most common legal form of business ownership; about 85 percent of all small businesses are proprietorships. The liability of the owner is unlimited in this form of ownership.

Protest - A statement in writing by any bidder or offeror on a particular procurement alleging that another bidder or offeror on such procurement is not a small business concern.

ProtTgT - A firm in a developmental stage that aspires to increasing its capabilities through a mutually beneficial business-to-business relationship.

Purchases - items bought and resold to customers. This includes the cost of all raw materials or parts purchased for manufacture into finished products.