business: An organisation selling goods and services with a profit motive.
features:
1.goods and services: There is no business without goods or services.
2.economic activities: exchange of goods and services for profits is economic activity. barter system is also called as an economic activity.
3.profit motive: business need to look for long term and short term profits. all the time profits are not immediate. for maximising profits capacity utilisation should be maximum. eg: uber has done maximum utilisation which ola could not do. aggregation and integration are based on capacity utilisation. sometimes even outsourcing is done to maximise profits.
4.business as a system: In a business the system is inputs are processed to get output.
5.regular transactions: sale of scrap, old newspapers etc. does not come under business. the regularity in dealing with goods or services is called as business.
features:
1.goods and services: There is no business without goods or services.
2.economic activities: exchange of goods and services for profits is economic activity. barter system is also called as an economic activity.
3.profit motive: business need to look for long term and short term profits. all the time profits are not immediate. for maximising profits capacity utilisation should be maximum. eg: uber has done maximum utilisation which ola could not do. aggregation and integration are based on capacity utilisation. sometimes even outsourcing is done to maximise profits.
4.business as a system: In a business the system is inputs are processed to get output.
5.regular transactions: sale of scrap, old newspapers etc. does not come under business. the regularity in dealing with goods or services is called as business.
6. transfer of property: transfer of ownership is done to claim for damages. eg: insurance is given only to the owner.
7.business is a science and art: the planning part is called as art and implementation of the plan is a science. art is how can the things be done in other ways, whereas science is getting things done.
8.size:business are classified as micro, small, medium and large. these are classified based on capital investment.
note: only the points which are discussed in class are mentioned above.
The following are the ten important characteristics of a business:
ReplyDelete1. Economic activity:
Business is an economic activity of production and distribution of goods and services. It provides employment opportunities in different sectors like banking, insurance, transport, industries, trade etc. it is an economic activity corned with creation of utilities for the satisfaction of human wants.
2. Buying and Selling:
The basic activity of any business is trading. The business involves buying of raw material, plants and machinery, stationary, property etc. On the other hand, it sells the finished products to the consumers, wholesaler, retailer etc.
3. Continuous process:
Business is not a single time activity. It is a continuous process of production and distribution of goods and services. A single transaction of trade cannot be termed as a business. A business should be conducted regularly in order to grow and gain regular returns..
4. Profit Motive:
Profit is an indicator of success and failure of business. It is the difference between income and expenses of the business. The primary goal of a business is usually to obtain the highest possible level of profit through the production and sale of goods and services.
5. Risk and Uncertainties:
Risk is defined as the effect of uncertainty arising on the objectives of the business. Risk is associated with every business.
a) Taxes
ADVERTISEMENTS:
b) Change in the volume of expected sales
c) Cost of supplies and equipment
d) Overhead costs
e) Salaries
f) Cost of goods and services offered
Unpredictable factors include:
a) Changes in trends and tastes of customers.
b) Impact of the local economy on customer base.
c) Any unexpected action taken by your competitors.
The calculation and management of the risk is vital to ensure the success of a business firm. Insurance and Risk management helps in minimizing the risk associated with the business.
6. Creative and Dynamic:
Modern business is creative and dynamic in nature. Business firm has to come out with creative ideas, approaches and concepts for production and distribution of goods and services. It means to bring things in fresh, new and inventive way.
7. Customer satisfaction:
The phase of business has changed from traditional concept to modern concept. Now a day, business adopts a consumer-oriented approach. Customer satisfaction is the ultimate aim of all economic activities.
8. Social Activity:
Business is a socio-economic activity. Both business and society are interdependent. Modern business runs in the area of social responsibility.
9. Government control:
Business organisations are subject to government control. They have to follow certain rules and regulations enacted by the government.
Some important acts framed by the government include:
i. The Competition Act, 2002
ii. Foreign Exchange Management Act, 1999
iii. The Environment Act, 1986
iv. Indian Companies Act, 1956
v. Consumer protection Act
10. Optimum utilisation of resources:
Business facilitates optimum utilisation of countries material and non-material resources and achieves economic progress. The scarce resources are brought to its fullest use for concentrating economic wealth and satisfying the needs and wants of the consumers.
Following changes and clarifications on Navya's Posting to be noted.
ReplyDelete1. "eg: uber has done maximum utilisation which ola could not do". Not right. Please check before you post either from your friends or me. Both Uber and Ola have been quoted by me as examples for aggregating underutilized capacities in erstwhile Taxi Hiring. You cannot pass any comment on a company without authentic information. Be careful before posting the facts.
2. "regular transactions: sale of scrap, old newspapers etc. does not come under business. the regularity in dealing with goods or services is called as business." I did not take this example. First I should appreciate you for taking an example. But your example is not reflecting the true essence of what we discussed in the class. You didnot understand the issue fully. All blog members to please note that " Examples quoted will become business if done continuously by an entity with a profit motive. They do not become a business if an entity like a household do the transaction once a while to cleanup the house."
3. Please note that getting things done is not Science. It is sheer mistake and please forget this understanding. A simple but not a comprehensive understanding but "Science is that which consistently when repeated gives the same /similar results".
4. Many more points covered in the class are not covered by Navya. This is OK but you need not give this statement that only points covered in class are posted.
Overall it is encouraging that students are taking to blogging habit on the subject. But I need more active discussions and exchanges please.