OBO, or open-book accounting, is a method of bookkeeping that allows businesses to more easily track their finances and performance. It’s also known as “cash basis accounting.” To use OBO, businesses first need to create a journal or ledger. This document will track all transactions and assets owned by the business. Next, each transaction must be recorded in the journal or ledger in a specific column. For example, if a company sells an asset for $10,000, the transaction would be recorded in the “Selling Assets” column and the corresponding dollar amount would be entered into the “Amount Sold” column. Finally, to calculate financial statements using OBO, all transactions must be totaled from the journal or ledger and entered into appropriate columns on a financial statement template. This process can be time-consuming and can lead to inaccuracies if not done correctly. To avoid these problems, it’s important for businesses to have someone who is familiar with OBO accounting oversee the process. ..
Or Best Offer
OBO stands for “or best offer.” It’s an acronym that sellers use to denote that they’re willing to accept a price outside their initial ask. This acronym is usually added at the end of the listed price in online marketplace websites like Craigslist or Facebook Marketplace. For example, a post might read “$500 obo.” This initialism can be written in both uppercase and lowercase.
This acronym applies to all kinds of items, from smaller objects like individual pieces of clothing to more expensive things like electronics and vehicles. You’ll often see this item in posts where someone sells many objects at the same time and is pricing them “off-the-cuff.”
Sellers can also use this acronym if they aren’t entirely sure of the value of the item they’re selling. For example, you might not be sure about the resale value of a years-old phone, so you might quote it at a price you see online then invite people to negotiate with you.
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The Origin of OBO
You can trace OBO back to the earliest days of online selling, as online forums, message boards, and classified websites emerged. The term’s earliest entry in the internet slang repository Urban Dictionary dates back to 2004 and reads, “Or best offer. Used in classifieds sections.”
It became even more common online as online selling became the default way of getting rid of things around your house. It’s also a used on social media platforms like Facebook and Twitter.
Auctions vs. OBOs
Something that may be confusing is the difference between an auction on a website like eBay versus an “OBO” selling post.
Auction sales typically involve setting a base price and asking people to bid increasing prices on the item based on their perceived value. This means that there’s no actual cap on what the price of a particular item could be. While some sellers include a “Buy Now” price that allows users to skip the auction process, many people still participate in bidding in the hopes of getting a better price.
OBO posts serve as an invitation for prospective buyers to negotiate. It’s essentially a signal that you’re willing to accept less than your listed price. However, it also signals that there may be multiple people making an offer on the same item and that they’ll be comparing offers from different buyers before deciding who to sell it to. Depending on the rest of the post, OBO may also imply that the seller is willing to negotiate through non-monetary terms.
Other Than Money
Non-monetary terms can mean a lot of things. It could include bartering, which is trading objects of similar value. A seller willing to compromise on their selling price might be open to receiving items, or a mix of money and objects. For example, someone trying to sell a phone might be willing to accept a combination of a lower-powered phone and cash.
A similar factor that comes into play during person-to-person negotiations is payment methods. Many sellers prioritize receiving money in cash, direct transfer apps like Venmo, or even cryptocurrency. These are alternatives to commerce-oriented platforms like credit cards and PayPal, which may take a percentage out of transactions and take longer to process. That means you might be able to negotiate a lower price if you can pay through a direct channel.
Lastly, OBO might come with a sense of urgency. Suppose someone is trying to sell an object quickly because they’re moving or need the money soon. In that case, they may be willing to sell at a lower price if they can complete the transaction immediately. That means they might take an early offer even if they feel that they can get more money in the future.
How to Use OBO
If you’re a seller, using OBO is relatively simple: add the acronym to the price that you have listed in your post. This is an instant signal to prospective buyers that you’re open to negotiating the price. You can use it in both lowercase or uppercase.
Here are a few examples of the acronym in action:
Good luck, and happy shopping!
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