Foundation of Business

From WikiEducator
Jump to: navigation, search

SLMtitle.png Foundation of Business

By Md. Motaharul Islam

Chapter Outline

  1. Introduction
  2. Learning Objectives
  3. Business: Meaning, Features and objectives
    1. Meaning of business
    2. Features of Business
    3. The objectives of Business
  4. Business: Field or Scope, Differences with Profession and Requisites
    1. Scope of Business
    2. Requisites of a successful Business
    3. Differences between business and Profession
  5. Let's Sum Up
  6. Key Points
  7. Glossary
  8. Practice Test
  9. Answers to SAQs
  10. References anf Further Readings

SLMinto.png Introduction

Human needs are unlimited. Human can fulfill their unlimited needs with the supply of products and services by business. Business can help us to get different products / services from manufacturer and service provider. In addition, business helps us to earn profit. Therefore, nobody should wait for job only and if you have, some ideas about business so you can be easily start business and help to be self-dependent.To start any business successfully peoples offcourse want to get some concepts , objectives, features , requisites etc. about business.In our society some people don,t want to do their jobs under supervision of any manager.This group of people alaways want to be boss not subordinate.Business is only the field which can help anybody to be the boss in their own field.From this chapter anybody can get some ideas about business,and its features, objectives, scope, requisites etc.

SLMobj.png Learning Objectives
After reading this chapter, you are expected to learn about:

  • Define business in the context of sole proprietorship, partnership, joint stock company and state enterprise;
  • Describe the features of business based on the above context;
  • Elaborate the objectives of business;
  • Explain the Scope of Business;
  • Identify the requisites of a successful business; and
  • Distinguish between business and Profession.

Business: Meaning, Features and objectives

Business is a process which can help us to earn prfits and exchange mutual benefites. Why we do business? Offcourse there are some specific reasons or objectives behind this question. Mainly we do business for profits, besides this business can helps to survive our life style and ensure to assign our responsibility for the society. (Comment.gif: Add content here, as a section can't go blank)

Meaning of business

Business is the exchange of goods, services or money for mutual benefit or profit. Literally speaking business means business. In simple words, business means the state of being busy. Broadly, business involves activities connected with the production of wealth. It is an organized & systematized, human activity involving production & purchase of goods & services with the objective to selling them at a profit. According to prof. Own, “Business is an enterprise engaged in production & distribution of goods for sell in market or rendering services for a price Finally, we can tell that business concerns with buying & selling goods, manufacturing goods or providing services in order to earn profit.

Features of Business

There are different features of business from above description as follows:

  1. Sale or transfer of goods for value--One of the basic features of business is that it involves sale or transfer of Goods & Services for value.
  2. Dealing in goods & services--Infect implies dealing in goods & services like bread, cloths watch etc.
  3. Recurrence of dealings--Business involves recurring or repeated transactions of sell & Purchase for sell.
  4. Profit motive--Profit motive is the biggest & powerful stimulus. For running a of Business, Business involves production & purchase of goods & services With the Motive of selling them at profit.
  5. Risk involved--Business risk also. Profit or depends upon the degree of risk involves. The business is rewarded in tarns of profit for his/her risk bearing capacity.
The objectives of Business

Business must achieve there objectives to, Remain in operation. Lists of Business objectives generally include such factors as-

  1. Survivable, Growth & social responsibilities--Survival is an obvious objective and growth is another objective because business does not stand still.

In resent years, meeting social responsibilities has been recognized as an important objective of business.

  1. Profit--The profit objective plays the major role in business. Successful business organization earn a profit because there goods & services effectively meet customers needs & demands. Profit rewards a business enterprise conducting a number activity.

SLMsaq.gif Self-Assessment Questions (SAQs) - 1
1.What do you mean by business?

2.Why we do business?

Business: Scope, Differences with Profession and Requisites

We can starts different types of business for different purpose. For starting any business we need money. But how much money are required for which business this is very important. That is why we should know about different types of business, commerce, industry, trade etc. We also want to gather some ideas about profession. (Comment.gif: add some content here)

Scope of Business

Having gun through the definition & characterizes of business let us now know the scope or component of business. It includes industry, commerce & trade. In brief industry is concerned with the production of goods & material while trade & commerce are concerned with there distribution. Let us discussed these in more detail-

A) Industry- in simply ward industry refers to the process of interactions & production of goods sent for final consummation or use by another industry for us production. According to nature industry are broadly classify into four times.

  1. Interactive Industries- This industry are concerned with the extraction & utilization of natural recourses from the earth, sea & air.
  2. Genetic Industries- these industries include Breeding of plants, seeds, cattle Breeding farm, fish hatcheries, poultry farms
  3. Manufacturing Industries- manufactories are engaged in the conversion of rentals or semi-finished goods into finished goods, manufactories industry can further be classified into following five types-
    1. Analytical industry
    2. Processing industry
    3. Synthetic industry
    4. Serves industry
    5. Assembly industry
  4. Construction industries- these industries are concerned with the creation of infrastructural facilities for face lifting other activating like construction of building bridge roads etc.

B) Commerce- Commerce is the gather major components of business. It includes all those activities which are necessary to bring goods & services from, the place of there production to the place of there consumptions. In simple words commerce include trade & aid to trade. The principle functions. Of trade are to remain the following hindrances-

I.Hindrances of persons
II. Hindrances of Exchanges
III. Hindrances of place
IV. Hindrances of time
V. Hindrances of information

C) Trade- Trade infact is a branch of commerce itself. In a way, it is a final stat of business activity involving sale & purchase of goods on the basic of its coverage & volume trade is normally classified into the following types-
1. On the basis of value-

a) Whole sale trade
b) Retail trade

2. On the basis of coverage-

a) Regional trade
b) National trade
c) International trade
Requisites of a successful Business

Today the business has become very competitive & complies. It is said that, “Business has become a bed of thorns”. A businessperson has to give proper thought to this consideration in order to make his business a successful one. The important requisites for success in a modern business are listed as follows:
1. Clear objective
2. Planning
3. Sound origination
4. Market research capability
5. Finance
6. Proper plant location layout & size
7. Effective Management
8. Harmonious relations with the employees
9. Risk taking capacity.

Differences between business and Profession

Business Business is the exchange of goods and services for mutual benefits or profits.

Profession: Profession means a kind of vocation, which creates with it a specialized skill & knowledge the individual has acquired. A professional man renders his specialized services to his client in return for a predetermined fee like doctors, lawyers, teachers etc.

The main differences between business & profession are given below:

Legal formalities like registration are to be fulfilled. Become the member of concerned professional body.
The primary objective of business is earning profit. Profession is primarily guided by service motive.
There is no code of conduct for business firm. However, professions are guided by specific professional ethics.
Business has client in general. Profession has only specific clients.
Profit is rewarded in business. In profession, reward is professional fee.
Risk is involved in business from beginning to end. The element of risk involved in profession is negligible.

SLMsaq.gif Self-Assessment Questions (SAQs) - 2
1. What requisites are important for business?

2. Discuss the scope of business.
3. Show the differences between business and profession.

SLMsum.png Results

SLMkp.png Key Points

The key points of this chapter are as follows:

1. Business
2. Industry
3. Commerce
4. Trade
5. Profit
6. Profession

SLMtest1.png Practice Test

Essay Type Questions

1.Define Business? Explain its features.
2.Discuss the objectives of business.

Short Type Questions' 1. What is business?

Essay Type Questions'

1.Describe the scope of business.
2.What are the differences between business and profession.

Short Type Questions

1. Mention the requisites of successful business?
2.What is profession?

SLMref.png References and Further Readings

1. Business 21st Century by Skinner

2. Web site