0Overview of nature and purpose of business
Concept of business:-
Business can be defined as an economic activity concerned with regular production and distribution of goods and services to fulfil the needs and wants of society with a motive to earn a reasonable profit.
Characteristics of business:-
- Economic activity
- Production of goods and services
- Sale of products and services
- Dealing regularly
- Uncertainty of return
- Risk
- Profit
- Dynamic movement
- Legality
- Satisfying human needs and wants
Objectives of business:-
Goals of business can be categorised into two parts that are the primary objective and secondary objective.
Primary objective:-
The primary aim of the business is:-
- Survival
- Profit earning
- Growth
Secondary objective:-
These are as follows:
- Market standing
- Innovation
- Productivity
- Resources earning
- Manager performance
- Workers' performance
- Social responsibility
Classification of business activities:-
It can be classified into two parts:
1. Industry and
2. Commerce
The industry refers to a group of firms producing similar products.
It can be further categories into three parts:
Primary industries
- Genetic industry
- Extractive industry
Secondary industry
Manufacturing industry:- it can be of four types:
Analytical industry, synthetical sector, processing industry, and assembling industry.
Construction industry
Tertiary industry
Commerce:- It can be classified into two parts:-
Trade and auxiliary to trade
Trade having the following parts:-
- Iternal trade consisting of wholesale and retail business
- External trade consisting of import, export and entrepot.
Auxiliary to trade consisting of:-
- Transportation and communication
- Banking
- Warehousing
- Advertisement
- Insurance
