NOTE : Firstly read the notes given by Mr Rama Rao sir and then read this Notes to get the better understanding of the subject. Here in addition to classroom notes given by sir I have added some points of my own from my b.com books and from google and also from Rama Rao sir's notes{ not the whole notes] as my motto was to give a full knowledge of the subject . I HAVE DISCUSSED ALL THE CHARACTERISTIC FEATURES OF BUSINESS . If there are any mistakes in the text please get it to my notice .
BUSINESS
A Business is an economic activity which buys or manufactures and sells the goods and services.
An organization or economic system where goods and services are exchanged for one another or for money.
Every business requires some form of investment and enough customers to whom its output can be sold on a consistent basis in order to make a profit.
Businesses can be privately owned, not-for-profit or state-owned. An example of a corporate business is PepsiCo, while a mom-and-pop catering business is a private enterprise.
Goods are tangible and services are intangible .
CHARACTERISTIC FEATURES
1] Dealing in Goods and Services : The sole purpose of a Business is dealing with goods and services for profit . Goods are both consumer and capital goods . Services are the benefits given to the customers by the business for profit .
It is sometimes possible that a business which deals with goods get into service industry to support the business of the respective goods. It is also possible that a service oriented business enters into goods industry to support the business of the service .
Hence there is an orientation between service industry and goods industry
Example: Maruthi company has opened NEXA showrooms as a part of service to customers to sell its cars baleno and s-cross .
Telecom companies sell the sim cards though their primary business is to provide service .
2] Economic Activity : Economic activities are related to production, distribution, exchange and consumption of goods and services. Human activities which are performed in exchange for money or money's worth are called economic activities. Outsourcing of any services is also termed as economic activity . Barter system is also a part of economic activity .
Example : In Barter system
13] Registration of a business:
Business Registration provides more prominent visibility on your domain name's Whois listing by letting you add a logo, business links, images, business hours, coupons, and even a local map that highlights your location.
You can only add Business Registration to domain names registered in your account with us. However, you can associate a Business Profile with any valid domain name, regardless of where it is registered.
14] Transfer of tittle : In dealing with goods transfer of title to the goods is an important element. In a sale of goods when the seller sell it to the buyer the ownership of the good should be passed at the same time .It is the evident that the insurer gives insurance amount in case of any unforeseen loss to the good only on the basis of the title to the good
15] Element of Risk: It is risk as there is a uncertainity of income or chances of loss .changes in tastes, preferences of consumers, strikes, increased competition, change in government policy, obsolescence etc .Every business organization contains various risk elements while doing the business
For example, an owner of a business may face different risks like in production, risks due to irregular supply of raw materials, machinery breakdown, labor unrest, etc. In marketing, risks may arise due to different market price fluctuations, changing trends and fashions, error in sales forecasting, etc. In addition, there may be loss of assets of the firm due to fire, flood, earthquakes, riots or war and political unrest which may cause unwanted interruptions in the business operations. Thus business risks may take place in different forms depending upon the nature and size of the business
16] Reliability :Reliability is the degree to which measures are free from error and therefore yield consistent results. The definition appears to include factors such as repeatability and internal consistency of the instrument of measure. The goods and services produced by a business should be reliable so that a business can achieve goodwill.
BY P.RAGHU SAYEE KOUSHIK REDDY
ROLL : 171267
BUSINESS
A Business is an economic activity which buys or manufactures and sells the goods and services.
An organization or economic system where goods and services are exchanged for one another or for money.
Every business requires some form of investment and enough customers to whom its output can be sold on a consistent basis in order to make a profit.
Businesses can be privately owned, not-for-profit or state-owned. An example of a corporate business is PepsiCo, while a mom-and-pop catering business is a private enterprise.
Goods are tangible and services are intangible .
CHARACTERISTIC FEATURES
1] Dealing in Goods and Services : The sole purpose of a Business is dealing with goods and services for profit . Goods are both consumer and capital goods . Services are the benefits given to the customers by the business for profit .
It is sometimes possible that a business which deals with goods get into service industry to support the business of the respective goods. It is also possible that a service oriented business enters into goods industry to support the business of the service .
Hence there is an orientation between service industry and goods industry
Example: Maruthi company has opened NEXA showrooms as a part of service to customers to sell its cars baleno and s-cross .
Telecom companies sell the sim cards though their primary business is to provide service .
2] Economic Activity : Economic activities are related to production, distribution, exchange and consumption of goods and services. Human activities which are performed in exchange for money or money's worth are called economic activities. Outsourcing of any services is also termed as economic activity . Barter system is also a part of economic activity .
Example : In Barter system
China, India, Iran and Turkey have offered to use the barter system in the food industry with Russia to avoid transactions in dollars, Russian agricultural watchdog aide Alexei Alekseyenko told Sputnik News.
“We have been getting suggestions from various countries that accounts should be handled in national currencies, or even using mutual goods, that is the barter system, “Alekseyenko told the news agency. “We’ve had negotiations in Tehran, Ankara, New Delhi, Beijing, and so forth.”
Russia is looking at trading national currencies with China, India and Indonesia.
3] Profit Motive : The main motive of each and every business is to make a profit . In profit making there are two types of profits : short term profit and long term profit . The short term profit is the net profit attained by a business at the end of the year . Long term profit is the creation of goodwill .
Integration or aggregation of business is based on capacity utilisation . A business to make profits have to make full utilisation of capacity.
Example : Engineering colleges outsourced their space to polytechnic course at the free time of Engineering classes and are making profits.
4] Regularity of Transactions : An organisation to be called a business should perform an economic activity by the exchange of goods and services . The exchange of goods and services should be regular i.e. only one or two transactions cannot be called a business. The transactions should be regular and recurring.
Example : A one time sale of old clothes to a relative is not a business . These sales should be recurring and regular to be called a business.
5] Element of competition : A class of businesses which sell the same type of product with a small difference in their respective product . Then the class of businesses are said to be in competition.
Example : Jio, Airtel , idea etc are said to be in competition.
6] Size : It is an element of a business which is measured on many parameters like capital , size of the organisation , no of employees . The size of business is mostly based on the size of capital
7] Management : A management is a back bone of a business which controls the flow of goods and services and cash flows . It is an effective tool to generate long term profits. A business is a set of processes , it is a set of circumstances etc controlling all the sets is known as management .
8] Innovation : Innovation means introducing a new product or a new process to facilitate the product to the customer i.e. either in production process or in the marketing process . Innovation is a fuel to a business which raises the income of the business time to time . New and innovative products increase consumer satisfaction.
9] Capital : A capital is the investment made by the owner in the business .Capital is the money or wealth needed to produce goods and services. In the most basic terms, it is money. All businesses must have capital in order to purchase assets and maintain their operations. Business capital comes in two main forms: debt and equity.
10] Social Process : A business is a social process as it is run by society in the form of customers , employees and other individuals .Social processes are the ways in which individuals and groups interact, adjust and readjust and establish relationships and pattern of behaviour which are again modified through social interactions.
11] Business as a system : A system means a proper plan to achieve the objectives of a business. A methodical procedure or process that is used as a delivery mechanism for providing specific goods or services to customers.
12] Art as well as Science : In business generation and execution of an idea is an art . A definite set process to run a business is known as Science .This art should be supported by a science . A business is a combination of art and science . 13] Registration of a business:
Business Registration provides more prominent visibility on your domain name's Whois listing by letting you add a logo, business links, images, business hours, coupons, and even a local map that highlights your location.
You can only add Business Registration to domain names registered in your account with us. However, you can associate a Business Profile with any valid domain name, regardless of where it is registered.
14] Transfer of tittle : In dealing with goods transfer of title to the goods is an important element. In a sale of goods when the seller sell it to the buyer the ownership of the good should be passed at the same time .It is the evident that the insurer gives insurance amount in case of any unforeseen loss to the good only on the basis of the title to the good
15] Element of Risk: It is risk as there is a uncertainity of income or chances of loss .changes in tastes, preferences of consumers, strikes, increased competition, change in government policy, obsolescence etc .Every business organization contains various risk elements while doing the business
For example, an owner of a business may face different risks like in production, risks due to irregular supply of raw materials, machinery breakdown, labor unrest, etc. In marketing, risks may arise due to different market price fluctuations, changing trends and fashions, error in sales forecasting, etc. In addition, there may be loss of assets of the firm due to fire, flood, earthquakes, riots or war and political unrest which may cause unwanted interruptions in the business operations. Thus business risks may take place in different forms depending upon the nature and size of the business
16] Reliability :Reliability is the degree to which measures are free from error and therefore yield consistent results. The definition appears to include factors such as repeatability and internal consistency of the instrument of measure. The goods and services produced by a business should be reliable so that a business can achieve goodwill.
BY P.RAGHU SAYEE KOUSHIK REDDY
ROLL : 171267
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