People in Business Unit 1

 Explain the differences between commercial and non- commercial businesses  List and explain the stakeholders, with examples of each  Explain what interest groups are  Explain the different types of relationships that can occur between the stakeholders in business  List and explain the key elements in a contract At the end of this topic you will be able to...

Commercial v non-commercial businesses  A commercial business is one which has the aim of making a profit, e.g. Dunnes Stores, Ryanair, Apple  A non-commercial business is an organisation which exists for some other reason than making a profit, i.e. to provide a service e.g. charity (Focus Ireland), state agency (FÁS)

Stakeholders in Business Entrepreneur Service Provider Producer Supplier Government Investor Employee Employer Consumer Stakeholders

 An entrepreneur is a person who spots a gap in the market, takes the initiative to set up a business and takes the risk involved in setting up in business  Click here for the Top 10 Irish Female Entrepreneurshere  Entrepreneur of the Year videosvideos  Too Entrepreneurs

 People or organisations that provide support services to the business  Examples:  Financial institutions provide accounts, loans, etc.  Insurance companies provide insurance cover  Solicitor provides legal advice  Electricity companies provide the business with power Service Providers

 Turn raw materials into finished products  They enter into contracts with suppliers  They try to make a profit by keeping costs low and prices competitive  Example – Glanbia turns milk into yoghurt and cheese Producers

 Provides the raw materials required by producers  They compete with other suppliers for contracts by offering inducements, e.g. discounts, credit, prompt delivery or free delivery  Example – dairy farmer Suppliers

 Can effect businesses by the decisions they make, e.g. laws, taxes, etc. Government

 Investors provide finance or funding for a business  In exchange, they expect a return on their money  The greater the risk they take, the greater the return the expect  Examples of investors include shareholders, banks, venture capitalists, the Government Investors

 Make or sell the goods and services for the business in exchange for payment of a wage or a salary Employees

 Hire employees to perform various tasks Employers

 A consumer is a person who buys goods and services for their own use Consumers

Consumer v Customer?

 Interest groups represent the interests, views or goals of the various stakeholders  They achieve results by applying pressure or lobbying decision makers  Example: Society of the Irish Motor Industry (SIMI) successfully lobbied the Government to extend the scrappage scheme in for cars. Click here for article Click here for article What are Interest Groups?

 IBEC – Irish Business and Employers Confederation IBEC  ICTU – Irish Congress of Trade Unions ICTU  CAI – Consumers’ Association of Ireland CAI  IFA – Irish Farmers Association IFA  LVA – Licenced Vintners Association LVA  ITAA – Irish Travel Agent’s Association ITAA  INOU – Irish National Organisation for the Unemployed INOU Examples of Interest Groups

 Relationships between a business and its stakeholders can be either co-operative or competitive  A co-operative relationship occurs when they work together towards a common goal in a mutually beneficial way (win-win)  A competitive relationship occurs when both parties want the same thing but only one of them gets it (win-lose) Business Relationships

 Employees work in teams  Employees and employers agree on wages and work conditions  Producers listen to feedback from their customers  Investors give funding to entrepreneurs who keep them informed and rewarded Co-operation within a business

 Two or more companies may form a strategic alliance  They will share skills, ideas, costs and profits  Example: General Motors and Citroen jointly developed the Opel Corsa and Citroen C3 cars Co-operation between businesses

 Employees compete with other employees for promotion  Employees look for increased wages but employers want to keep costs to a minimum Competition within businesses

 Two producers or service providers may compete on prices, e.g. Ryanair and Aer Lingus  Consumers benefit from lower prices Competition between businesses

In this topic you have learned about:  Commercial and non-commercial businesses  Stakeholders  Interest groups  Co-operative and competitive relationships in business Review of People in Business