Goodwill

Definition: Intangible business value associated with factors such as reputation, customer relationships, and expected continued patronage.

Example

An established local business has repeat customers and a trusted name that can contribute value beyond its physical assets.

Keep the distinction clear

Goodwill is not guaranteed merely because a business is old. It differs from tangible property and may depend on whether customer relationships can continue after a sale.

Related terms

Intangible Asset · Going-Concern Value · Tangible Asset

Keep studying

Corporation Sole, Sole Proprietorship, and Single-Owner Businesses

References: FREC Course II syllabus: investment concepts

Pronunciation (US): GOOD-wil (capitals show stress)

Pronunciation reference: Merriam-Webster