Unit 1 - Business Fundamentals Introduction to Business Terminology Unit 1 - Business Fundamentals

A business has two purposes: Business: An organization that produces or sells goods or services to satisfy the needs, wants and demands of consumers for the purpose of making a profit. A business has two purposes: 1. To make MONEY 2. To provide goods and services to satisfy consumer wants and needs “I feel that luck is preparation meeting opportunity” ~ Oprah Winfrey

Profit or Non-profit? For Profit Organizations: produces or sell goods and services to satisfy the needs, wants, and demands of consumers for the purpose of a making MONEY

For-profit Business By supplying goods and services, a business can make a profit Profit is the income left after all costs and expenses are paid. Expenses are the payments involved in running a business and the assets that get “used up” operating it. Cost is the money required to produce or provide the goods and services. Revenue – Expenses = Profit (or Loss)

Goods and Services Goods: items of monetary value that have been produced Television, Shoes Services: tasks performed by businesses for consumers Lawn Mowing, Spa Businesses can sell both goods and services. Goods are TANGIBLE can touch them Services are INTANGIBLE can’t touch them

Goods or Services? Businesses that sell goods Businesses that provide services Businesses that do both

Non-Profit Organizations

WHAT IS NOT-FOR-PROFIT? Not-for-profit Organization: uses any surplus funds to improve the services offered to its members. These businesses do not distribute profits to members.

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