Nature of Business

1. CHARACTERISTICS OF A
BUSINESS

2. IMPORTANT CHARACTERISTICS OF
A BUSINESS
 Economic activity
 Buying and Selling
 Continuous process
 Profit Motive
 Risk and Uncertainties
 Creative and Dynamic
 Customer satisfaction
 Social Activity
 Government control

3. Economic activity

4. Buying & Selling

5. Continuous process

6. Profit Motive

7. Risk and Uncertainties

8. Creative and Dynamic

9. Customer satisfaction

10. Social Activity

11. Government Control

12. Economic activity
Business is an economic activity of
production and distribution of goods and
services. It provides employment opportunities in
different sectors like banking, insurance,
transport, industries, trade. it is an economic
activity corned with creation of utilities for the
satisfaction of human wants.
Buying and Selling
The basic activity of any business is trading.
The business involves buying of raw material,
plants and machinery, stationary, property.
Continuous process
Business is not a single time activity. It is a
continuous process of production and

13. Profit Motive
Profit is an indicator of success and failure of
business. It is the difference between income
and expenses of the business. The primary goal
of a business is usually to obtain the highest
possible level of profit through the production
and sale of goods and services. It is a return on
investment.
Risk and Uncertainties
Risk is defined as the effect of uncertainty
arising on the objectives of business. Risk is
associated with every business. Business is
exposed to two types of risks such as Insurable
risk and Non-Insurable risk.

14. Creative and Dynamic
Modern business is creative and dynamic in
nature. Business firm has to come out with
creative ideas, approaches and concepts for
production and distribution of goods and
services.
Customer satisfaction
The phase of business has changed from
traditional concept to modern concept.
Social Activity
Business is a socio-economic activity. Both
business and society are interdependent.
Modern business runs in the area of social
responsibility.

15. Government Control:
Business organisations are subject to
government control. Government ensures that
the business is conducted for social good by
keeping effective supervision and control by
enacting and amending laws and rules from time
to time.
Important Acts Framed by Govt.
 The Competition Act 2002
 FEMA Act – 1999
 Indian Companies Act – 1956 (Old), 2013 (New)
 Consumer Production Act 1986

16. Profession

17. Profession
A profession is an occupation
founded upon specialized educational
training, the purpose of Public policy and
the nature of administrative responsibility.

18. Characteristics of a Profession
• It demands possession of a body of
specialised knowledge and extended
practical training.
• It renders an essential social service.
• It demands continuous in service
training of its members.
• It involves a code of ethics.
• It sets up its own professional
organization.
• It assures its members a professional

22. Characteristics of
Employment
 Passionate
 Communication Skills
 Goal Oriented
 Organized
 Adaptable
 Creative

24. Nature of Business, Profession &
Employment
Business
Business is defined as an activity
involving regular production (or) purchase
of goods and services for sale, transfer
and exchange of objective of earning
profit.
Profession
Profession is an operation for which the
individual to aquire a special knowledge
and skills.
Employment

29. Objectives of Business
1. Human Objectives
2. Social Objectives
3. National Objectives
4. Economic Objectives
5. Global Objectives

30. I. Human or Individual Objectives
Human or individual objectives
refer to the objectives related to the
individual needs of the employees of an
organisation. As employees are one of the
most valuable resources for an
organisation, satisfaction of their
objectives is very important.

31. Major Individual (or) Human objectives:
• To provide healthy and safe working
conditions.
• To pay fair and competitive salaries and
perks.
• To provide opportunities for personal
growth and development of employees.
• To provide reasonable security of service.
• To provide various financial and non-
financial incentives in order to motivate the
workers.

32. II. Social Objectives
Social objectives refer to the objectives,
which are desired to be achieved for the
benefit of the society.
Major Social Objectives:
 Supply of Quality products at Fair Prices
 Generation of Employment Opportunities
 Protection of Environment
 Welfare of Employees

33. III. National Objectives:
every business must have the
objective of fulfilling national goals and
aspirations. The goal of the country may
be to provide employment opportunity to
its citizen, earn revenue for its exchequer,
become self-sufficient in production of
goods and services, promote social
justice. Business activities should be
conducted keeping these goals of the
country in mind, which may be called

34. Major National Objectives
Creation of Employment
Production According to National Priority
Contribute to the Revenue of the Country
Export Promotion

35. IV. Economic Objectives:
Business is an economic activity and its
objectives are mainly economic in nature.
Main Economic Objectives:
 Profit Earning – Every entrepreneur
undertakes business activities primarily to
earn profits.
 Survival – Every business aims to ensure that
it continues to survive and exist in the future.
 Growth – A business needs to add to its
prospects in the long run.
Other Economic Objectives:
1. Creation of Customers
2. Innovation

36. V. Global Objectives
Major Global Objectives:
1. Raise General Standard of Living
Growth of business activities across
national borders makes quality goods
available at reasonable prices all over the
world.
2. Reduce Disparities among Nations
Business should help to reduce
disparities among the rich and poor
nations of the world by expanding its
operation. By way of capital investment in

37. 3. Make Available Globally Competitive
Goods and Services
Business should produce goods
and services which are globally
competitive and have huge demand in
foreign markets. This will improve the
image of the exporting country and also
earn more foreign exchange for the
country.