Concepts of Business
Concepts of Business
2CONCEPTS OF BUSINESS
❑Business
Topics
❑Barter
❑Economic Activities of Human Being
❑Types / Classification of Economic Activities
❑Difference Between Economic And Non-economic Activities.
❑Features of Business
❑Objectives of Business
❑Industry
❑Types of Industry
❑Commerce
❑Types of Commerce
❑Types of business
❑Forms of business organization
What things come to your
mind by the word
BUSINESS?
BUSINESS
2. Employment
Employment is a type of occupation under which one person provides his services,
physical or mental to someone else in return for which he gets salary or wage. The
person who employs is called employer and the person who is employed is called
employee or worker.
• 3. Business
•
Business is an economic activity concerned with production and
distribution of goods and services with the aim to earn profit. It
includes all those activities which are directly or indirectly concerned
with production, purchase and sale of goods and services. So the
production, marketing, advertising, warehousing, insurance, banking,
etc. are all business activities
Difference between economic and non-economic activities.
SURPRISED TEST-1
• Q1. What are the names of your University, Department, and Program?
• Q2. What are the names of this course and course code?
• Q3. What are the names of the reference book and author of this course?
• Q4. Write shortly what you have learnt so far from this course.
Features of Business
1. Production or acquisition of goods: It is the business of
“business” to provide goods to people for a price. It is necessary
to that there are goods to be supplied. They must therefore
either manufactured or produced.
1. Economic importance:
Every business
Every business must enterprise must aim
earn a reasonable at greater
profit to survive and productivity to
grow. ensure continuous
survival and growth.
Business should
generate
Large business units Social employment
should undertake opportunities to the
community services objectives disadvantaged
like setting up sections of the
charitable fund, society(e.g.
schools etc. physically
handicapped
people).
Welfare of
employees
Business should provide good working conditions and
pay satisfactory wages/salaries to its employees.
SCOPE OF BUSINESS.
Business
Industry Commerce
Extractive Manufacturing
Genetic Construction Home Foreign
Wholesale Retail
Import Export
Enterport
INDUSTRY
• Industry refers to manufacturing activity concerned with the
conversion of raw materials or semi finished goods into
finished goods.
•
• Prof. M. C. Shukla "The process of extraction, production,
conversion, processing or fabrication of products are
described as industry."
•
• P. H. Collin- "Industry means all factories or companies or
processes involved in the manufacturing of products."
TYPES OF INDUSTRY
• An Industry is either primary or secondary. Primary industry may be either
extractive or genetic, and secondary industry is either manufacturing or
construction.
•
• a. Primary industry: Industries which are concerned with the production of
goods.
•
• i. Extractive industries: Activities which are concerned with the extraction or
production of wealth from soil, water, air or beneath the surface of the earth.
Fishing, Mining etc.
•
• ii. Genetic industries: Activities which are undertaken for reproducing or
multiplying plants or animals with the object of earning profit from their sale.
Cattle breeding farms, Poultry farms,
b. Secondary industries: Industries where human labor plays a more important role than nature.
•
• i. Manufacturing industries: Activities concerned creation of infrastructure for
economic development.
•
• 1. Continuous Industry
• It is an industry in which all raw materials is received at one point, from which
successive operations turned into a finished products. As for example, yarn
spinning, paper and pottery manufacture.
•
• 2. Analytical Industry
• The basic materials is analyzed and separated into several parts –so that the final
product emerge separately and distinct from the mass of original materials. As
for example, the crude mineral oil is analyzed and separated in to kerosene, diesel
oil, lubricating oil, and the final product petrol.
•
•
3. Synthetical Industry
In this type of continuous industry various ingredients are brought
together and combined in the manufacturing process to produce
a new product. As for example, soap making.
4. Assembly Industry
In an assembly industry the finished product can be produced only
after various components have been made and then brought
together for final operations. As for example, shoes or
automobiles.
• 1. Service Business
• A service type of business provides intangible products (products with no physical
form). Service type firms offer professional skills, expertise, advice, and other similar
products.
• Examples of service businesses are: schools, repair shops, hair salons, banks,
accounting firms, and law firms.
• 2. Merchandising Business
• This type of business buys products at wholesale price and sells the same at retail
price. They are known as "buy and sell" businesses. They make profit by selling the
products at prices higher than their purchase costs.
• A merchandising business sells a product without changing its form. Examples are:
grocery stores, convenience stores, distributors, and other resellers.
• 3. Manufacturing Business
• Unlike a merchandising business, a manufacturing business buys products with
the intention of using them as materials in making a new product. Thus, there
is a transformation of the products purchased.
• A manufacturing business combines raw materials, labor, and factory overhead
in its production process. The manufactured goods will then be sold to
customers.
•
• Hybrid Business
• Hybrid businesses are companies that may be classified in more than one type
of business. A restaurant, for example, combines ingredients in making a fine
meal (manufacturing), sells a cold drinks (merchandising), and fills customer
orders (service).
• In that case, restaurants are more of the service type – they provide dining
services.