Introduction to Business Activities 1. Purpose 2. Types of Businesses 3. Jobs in Service industries 4. Business Resources 5. Unlimited Needs & Wants Vs Limited Resources 6. Managing Financial Resources - Calculation of Loan Interest 7. The Changing Business Environment 8. Nature of Competition - Direct vs Indirect
1. PURPOSE OF BUSINESS ACTIVITIES How will this affect the people in the country & the country? - Provide Goods and Services to the people. - Provide Jobs for the people. - Contribute to the wealth of the country . 2 business terms you must know: NEEDS – These are goods and services that are necessary for SURVIVAL. Question: What are some basic needs of yours? WANTS – These are goods and services that are NOT necessary for survival but which we WISH to have.
2. TYPES OF BUSINESSES GOODS-PRODUCING SERVICES
can be seen & touched
are produced with machines and/or labour
CANNOT be seen & touched but can be EXPERIENCED.
are performed when sellers interact with customers.
3. Jobs in Service industries RETAIL TRAVEL AND TOURISM HOSPITALITY RECREATION FINANCE HEALTH CARE EDUCATION
4. Business Resources (‘CELL’) C APITAL E NTERPRISE L AND L ABOUR
Natural resources Eg: rivers, forests, minerals, oil etc.
You need land to grow crops / build factories to produce goods to meet customers’ needs and wants.
Buildings, equipment and machinery used to manufacture goods and services.
Use of business resources to produce goods and services, and earn profits.
Efforts of the people involved in the production of goods and services. Eg: Farmers, receptionists, tour guides, chefs, bus drivers, engineers, teachers form part of the labour force etc.
5. Unlimited Needs & Wants Vs Limited Resources 6. Managing Financial Resources - Calculation of Loan Interest Needs & Wants > Resources Question: What is money needed for when you start a new business? Salary of Worker Machinery Office Furniture & Equipment Rent and Utilities Raw materials etc
Question: Where do you get the money when you want to start a new business? Personal Savings Loan from a Family members / friends Bank Loans Trade Credit from Suppliers
What is Trade Credit from Suppliers? You get your goods first and pay your suppliers later. Question: Why does the entrepreneur not have enough $ to pay his suppliers?
Customers do not settle their debts on time
Sales tend to go up or down according to the seasons of the year
Calculate LOAN INTEREST Interest = $Amount borrowed x Interest rate/100 x Duration of loan Refer to Textbook Pg 8 and 9
7. The Changing Business Environment “ PETS D G” P olitical and Legal E conomic T echnological S ocial D emographic G lobal