role of business in society

• what is a business?

  an organisation that makes, buys or sells goods or provides a service
• what do all businesses aim to do?

  satisfy consumer needs and wants
• needs

  the basic requirements that are essential for survival such as food, water, clothing, shelter and warmth
• wants

  things we would like to have but don't need to survive, such as mobile phones or holidays
• how can businesses satisfy needs and wants?

  by providing goods and services to the consumer
• goods


  products that you can see and touch (tangible) such as laptops, clothes or food
• services


  products that you cannot hold or touch (intangible) such as public transport, a haircut or a visit to the cinema
• 4 factors of production

  - capital

  - enterprise

  - labour

  - land
• capital


  the man-made resources used to produce a product or provide a service such as machinery, tools, money or delivery trucks
• enterprise


  - the idea the owner had to create the business

  - how the land, labour and capital is used to make a good or provide a service
• labour


  the workforce used to produce a product or provide a service such as builders, teachers or plumbers
• land


  the natural resources used to provide a good or service such as water, a plot of land, fields, fish or coal
• wealth creation


  the additional wealth that is added at each stage of the production process
• 3 sectors of industry

  - primary

  - secondary

  - tertiary
• primary


  - involved with the extraction of raw materials or natural resources from the land

  - any business that grows goods or extracts materials from the land would be classed as a primary sector business
• examples of businesses that operate in the primary sector

  - farming

  - mining

  - fishing

  - oil production
• secondary


  - concerned with manufacturing

  - involves taking the raw materials from the primary sector and converting them into new products
• examples of businesses that operate in the secondary sector

  - car manufacturers

  - food production

  - building companies
• tertiary


  - concerned with providing a service

  - services are activities that are done by people or businesses for consumers
• examples of businesses that operate in the tertiary sector

  - hairdressers

  - banks

  - supermarkets

  - cinemas
• 3 sectors of economy

  - private

  - public

  - third
• types of organisations in private sector

  - sole trader

  - partnership

  - private limited company (plc)
• who owns private sector organisations?

  private individuals
• what are the primary aims of the private sector?

  to survive and make a profit
• types of organisations in public sector

  - national government

  - local government
• who owns and controls public sector organisations?

  the government
• what are the primary aims of the public sector?

  to provide a service to the public
• how is the public sector funded?

  by taxes
• what areas do the public sector function in?

  - health

  - education

  - housing

  - social work
• types of organisations in third sector

  - charities

  - voluntary organisations

  - social enterprises
• why are third sector organisations set up?

  to help a cause or provide a service to members
• what are the primary aims of the third sector?

  - to raise money

  - increase awareness for good causes
• examples of third sector organisations

  - oxfam

  - the big issue

  - a local youth club