Where did the origination of the word “goodwill” as a business term come from?
Sunday, January 31st, 2010 at
7:29 pm
I’d like to know why the term "goodwill" is used to describe an intangible asset. From where did the term originate?
I’m simply confused why it is called goodwill since it appears to have nothing to do with being kind or benevolent.
Like this post? Subscribe to my RSS feed and get loads more!
When you buy a business, you buy the hard assets and you buy the name. It has long been assumed that any value over the value of the assets is because of the "goodwill" created by the name. As things developed, goodwill came to mean anything intangible which could not be easily valued - even for example the present value of future payments due a company.
It’s a measure of the positive or negative reputation a business or product has. I would guess the name was chosen because it denotes a positive reputation