Introduction to Business

• A producer is a person or organization that makes a good or service available. 
• • A consumer is a person or organization that uses a good or service.  
• • A person can be both a producer and a consumer of the same item.
• • Entrepreneurs are individuals who take risks to solve a problem or to take advantage of an opportunity to produce a good or supply a service to consumers. 
• • Certain qualities are needed to be a successful entrepreneur: leadership, motivation, people skills, organization, work ethic, drive/ambition, persistence (plus more)
• • Three economic resources, or  factors of production, motivate businesses to make goods and services available to consumers.  
• • These factors are natural resources, human resources and capital resources. 
• • Natural resources are the raw materials that the earth, water, air and wildlife provide.
• • Human resources are the people who work to create the goods and services.  These people may extract, refine or develop the raw materials or provide the services.
• • Capital resources refer to the buildings, equipment, tools and vehicles that a business owns.  
• • The relationship between these three factors combined to affect a business’ ability to produce its goods or provide its services.
• • Businesses are organizations that produce or sell goods or services to satisfy the needs, wants and demands of consumers, for the purpose of making a profit.  
• • Competition: a situation in which two or more businesses try to sell the same type of product or service to the same customer. 
• • Interdependent: mutually dependent; relying on others who also rely on you. 
• • Inventory is the goods and materials kept on hand.
• • Keeping a high inventory increases costs and reduces cash flow.  The money you have in your inventory cannot be reinvested in the business.
• • Obsolete: a product or service that consumers no longer want because it has become outdated or outmoded or has been replaced by a new or improved product.
• • Businesses whose products become obsolete risk going out of business.
• • Innovation: finding new ways to produce goods and services or new uses for existing goods or services or more efficient ways of producing these products.
• • Businesses that are innovative are much more likely to be successful.
• • Co-branding is the sharing of business premises by two or more businesses.
• • Co-branding can have both a positive and a negative impact on a business.