Business

• • Consumer services: Non-tangible products sold to the general public like tourism, hairdressing, banking
• Business Activity:

  • A business is any organization that uses resources to meet the needs of customers by providing a product or service that they demand
  • Business activities use scarce resources of our planet to produce goods and services
  • Types of goods and services:
  • Consumer goods: Physical and tangible goods sold for final consumption (e.g. Cars, Food and Drinks)
  • Capital goods: Physical goods used by businesses to aid in the production of consumer goods (e.g. Machines, Commercial Vehicles)
• Factors of Production:

  • Resources needed to produce goods and services
  • Four factors of production: land, labor, capital, entrepreneurship
  • Factors of production are limited in supply
• Added Value:

  • The difference between the selling price of a product and the cost of bought-in materials and components
• Dynamic Environment:

  • Businesses will succeed if they have a clear mission and vision, inspiring company culture, clear differentiation, and adequate financial reserves
• Reasons for New Businesses Failure:

  • Lack of record-keeping
  • Lack of cash or working capital
  • Poor management skills
  • Changes in the business environment (new competitors, legal changes, economic changes, technological changes)
• Types of Businesses:

  • Local businesses: Operate in a small and well-defined part of the country, no objective of expansion
  • National businesses: Have branches or operations across most of the country, no operations in other countries
  • International businesses: Operate in more than one country, often called multinational businesses
• Entrepreneur:

  • A person who takes the financial risk of starting and managing a new venture
  • Characteristics of an entrepreneur
  • Pros and cons of being an entrepreneur
  • Challenges faced by entrepreneurs
• Intrapreneur:

  • An employee who is tasked with developing an innovative idea or project within a company
  • Role of intrapreneurship in the ongoing success of a business
  • Impact of enterprises on a country's economy
• Business Plan:

  • A written document that describes a business, its objectives, strategies, the market it is in, and its financial forecasts
  • Uses of a business plan
  • Contents of a typical business plan for a new business
  • Limitations of business plans