What Is Business?.

What is Business Continued… Business is the production of goods and services Business is the production of goods and services Producers make goods or provide services and consumers buy them and use them Producers make goods or provide services and consumers buy them and use them Any item or product that you can purchase, possess, and use is a good Any item or product that you can purchase, possess, and use is a good Services are not physical objects. They are acts in exchange for pay. Services are not physical objects. They are acts in exchange for pay.

Business continued… A manufacturer is the company or business that produces the goods. A manufacturer is the company or business that produces the goods. A supplier provides the consumer with the good or service A supplier provides the consumer with the good or service Goods that consumers purchase directly to satisfy their needs and wants are called consumer goods. Goods that consumers purchase directly to satisfy their needs and wants are called consumer goods. The consumer who purchases a good for his/her personal use is called an ultimate consumer. The consumer who purchases a good for his/her personal use is called an ultimate consumer.

Business continued… Goods that businesses purchase from producers are called industrial goods, and the consumer is called the industrial consumer Goods that businesses purchase from producers are called industrial goods, and the consumer is called the industrial consumer Needs are essential things that people lack, and must be fulfilled in order for people to live Needs are essential things that people lack, and must be fulfilled in order for people to live Wants are things that we would enjoy having but that are not essential Wants are things that we would enjoy having but that are not essential

FACTORS AFFECTING BUSINESS SUCCESS Competition Competition Service Service Satisfaction Satisfaction Investment Investment Profit Profit Risk Risk

How Has Business Changed? Growth of small business Growth of small business A small business is defined as one that has fewer than 50 employees; in the manufacturing sector—100 employees Growth of the service sector Growth of the service sector Globalization Globalization Businesses now do business all over the world, from Asia to South America. The process of internationalization is called globalization.

How Has Business Changed Continued… Business Ethics Business Ethics Ethics are standards of conduct that society believes people should follow. Businesses, like people, must also follow ethical standards. Technology Technology Technology is scientific knowledge applied to practical uses. Businesses sell technology and use it.

Functions of Business Production is the process of converting a business’s resources into goods and services. Production is the process of converting a business’s resources into goods and services. Marketing is all the business activities to plan, price, promote, and distribute goods or services to satisfy customer needs and wants. Marketing is all the business activities to plan, price, promote, and distribute goods or services to satisfy customer needs and wants. Finance is the managing of money. Finance is the managing of money. Human Resources is the people aspect of business—the owner’s, managers, and employees. Human Resources is the people aspect of business—the owner’s, managers, and employees. Management—people who manage the business Management—people who manage the business

Functions of Business continued… All of these five functions of business rely on each other, and this mutual reliance is called interdependence.

Factors of Production Land—natural resources Land—natural resources Capital—machinery and equipment Capital—machinery and equipment Required to produce goods and services Labour is the human element of production and includes mental and physical work Labour is the human element of production and includes mental and physical work Technology is the application of scientific research and knowledge to improve the production and distribution of goods and services Technology is the application of scientific research and knowledge to improve the production and distribution of goods and services Entrepreneurship—is the person who brings together all the factors of production and starts the business Entrepreneurship—is the person who brings together all the factors of production and starts the business

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