1.1: What is Business Activity?

what is a business

an organisation that provides goods and services

features of business activity

1. output - a good or service.
2. consuming goods and services
3. usage of resources
4. bbusiness functions: production, marketing, human resources and financial control
5. external factors
6. profit

consumer goods

goods and services produced for consumers

producer goods

goods and services sold from one business to another

different types of businesses

* private enterprise
* social enterprise
* public enterprise

private enterprise

* owned privately
* in the private sector
* main objective is profit

social enterprise

* private sector
* non-profit
* charities, clubs, groups

public enterprise

* owned by government
* public sector
* provides resources private enterprises can’t adequately

are goods and services in the public sector free

usually yes, as they are paid for through tax

what is a business stakeholder

an individual or group affected by business operations

business stakeholders

* owners
* customers
* employees
* managers
* financiers
* suppliers
* local community
* government

owner

* own a business
* entreprenuers
* set up and run the business
* larger business are owned by shareholders who recieve a dividend upon investing

customers

* buy goods and services
* most are consumers
* some are other businesses

employees

* work for a business
* depend for salary
* require training
* want good working conditions, fair pay, benefits, job security and promotions

managers

* help run a business
* employed to run the different departments of a business
* lead teams, solve problems, make decisions, settle disputes, motivate workers
* help plan business direction
* control resources
* accountable to owners

financiers

* lend money to a business
* banks, individuals, venture capitalists

suppliers

* provide raw materials, parts, commercial services, utilities to other businessess
* have good relations with businesses
* rely on businesses

local community

* employs people who live in local community
* more jobs, overtime, higher pay
* businesses may be criticised by local communities

government

* provide employment
* generate wealth
* pay taxes

factors affecting a business

* competition
* economic climate
* government legislation
* population trends
* demand
* world affairs
* social factors

how do business deal with difficult trading conditions like recession

freeze wages, close down unprofitable divisions, reduce staff, improve efficiency