3. What is business ?
How we identify it is a business?
Do we need a permanent place to start the
business ?
What is the ultimate aim behind business?
Find some business organization around your
Locality?
TRIVANDRUM INTERNATIONAL SCHOOL
4. Business?
• Business is an Economic activity
which involves regular production
and or exchange of goods and
services with the main purpose of
earning profits through the
satisfaction of human wants.
TRIVANDRUM INTERNATIONAL SCHOOL
5. Familiar the meaning OF
Business?
1.business involves production and
exchange of goods.
2.It’s main aim is to earn profit.
3.It must satisfy human wants.
“ These activities are organised and
performed under the framework of
an institution known as business
organisation /firm/enterprise.”
TRIVANDRUM INTERNATIONAL SCHOOL
6. “According to B.O Wheeler, Business is
an institution organised and operated
to provide goods and services to
society under the incentive of private
gain.”
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7. Business ?
• Business pervades all human
activities directed towards earning
profits or economic gains.
Industry,trade,Banking,Transport
,Insurance,warehousing,advertisin
g etc are integral part of modern
business.
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8. TYPES OF ECONOMIC
ACTIVITY
ECONOMIC ACTIVITIES
BUSINESS PROFESSION EMPLOYMENT
TRADE
INDUSTRY
BANKING
TRANSPORTATION
INSURANCE
WAREHOUSING
ADVERTISING ETC.
MEDICAL
LEGAL
CHARTERED ACCOUNTANT.
MANAGER
FOREMAN
CLERK
SALESPERSON
WORKER,ETC...
TRIVANDRUM INTERNATIONAL SCHOOL
9. Definition of Business
• Business refers to all those activities
which are concerned with the
production and /or purchase and sale
of goods or services with the purpose
of selling them at a profit.
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10. Characteristics of business
• Economic Activity
• Production or procurement (acquisition of goods for the
purpose of sale)
• Dealing in goods and services;( goods are consumer goods
and capital goods)
• Satisfaction of consumer wants
• Regular dealings (continuous supply of goods and services)
• Profit motive
• Uncertainty.
• Risk element
• Creation of utility
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11. Objectives Of Business
• Business objectives as the purpose or
the reason for the existence of the
business in the society.
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12. Business activities
Business activities broadly divided in to
three;
They are,
a) Economic objectives,
b) social objectives
c)Human objectives
TRIVANDRUM INTERNATIONAL SCHOOL
13. TYPES OF BUSINESS ACTIVITY
ECONOMIC
OBJECTIVES
HUMAN
OBJECTIVES
SOCIAL
OBJECTIVES
1)EARNING OF PROFIT
)CREATION OF CUSTOMERS
3)INNOVATION
)EFFECTIVE UTILISATION
OF RESOURCE
1)GOOD SERVICE AND
FAIR DEALINGS
2)TREATING EMPLOYEES
AS PARTNERS
3) DEVELOPMENT OF EMPLOYEES
SKILLS
4) JOB SATISFACTION OF
EMPLOYEES
1)BETTER QUALITY PRODUCTS
2)FAIR TRADE PRACTICES
3)GENERATION OF EMPLOYMENT
EMPLOYEES WELFARE
4)COMMUNITY SERVICE
5)PROTECTION OF EMPLOYMENT
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14. NECESSITY OF PROFITABILITY
OBJECTIVE
• ACCORDING TO PETER. F. DRUCKER
“A BUSINESS MUST ACHIEVE SUFFICIENT
PROFITS TO COVER THE RISKS OF
ECONOMIC ACTIVITY AND THUS TO AVOID
LOSS”
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15. A BUSINESS MUST EARN ADEQUATE
PROFITS BECAUSE OF THE FOLLOWING
REASONS;
• MEANS OF LIVELY HOOD
• RETURN TO INVESTORS
• REWARD FOR RISKS
• SOURCE OF FINANCE FOR GROWTH AND
EXPANSION
• INDICATOR OF EFFICIENT WORKING
• GOODWILL OR REPUTATION
TRIVANDRUM INTERNATIONAL SCHOOL
16. Can profit be the sole
objective of a Business
• A lay man may say that business is
carried on for profit only. But a good
business man cannot afford to keep
profits as his sole objective.
• “earning of profits cannot be the
objective of a business any more than
eating is the objective of living”
17. The argument against the
profit maximisation are;
• Profit maximization ignores the interests of
labour,customers,and the society.
• Unfair means such as hoarding, black marketing or
adulteration may be followed to maximize profits.
• Long term interest of the business may be ignored
to maximize profits in the short run.
• In the present day environment, a business can't
be effective with the sole objective of profit
maximisation.It must also set objectives in areas
like customer satisfaction, employee welfare,
community development, environment protection
etc..
18. Multiplicity objectives of a
Business
• According to peter f Drucker
remarked “To manage a business is to
balance a variety of needs and goals.
And this requires multiple
objectives”
• He suggests 8 areas where
objectives must be set.
19. Multiplicity objectives of a
Business
• 1 market standing (eg; Bata)
• 2 Innovation (eg; Hero Honda)
• 3 productivity( It is the ratio b/w output and inputs in
production process. it is considered as the efficiency of the
enterprises.)
• 4 Human organization-workers attitude and
performance
• 5 Physical and financial resources
• 6 managarial performance
• 7 social rresponsibility
• 8 profitability-reasonable rate.
21. Classification of business
activities
• On the basis of size business activities are
classified as
• 1 small scale
• 2 large scale
• Small scale the investment does not
exceed Rs 100 lakhs.
• Large scale means the investment exceed 1
Crore
22. Classification of business
activities
• On the basis of OWNERSHIP
business activities are classified as
• Public sector –under the govt. control
• pvt sector-under private control
• Joint sector –both govt. and private
23. Classification of business
activities
Public enterprises may be organized as
• Departmental undertaking
• Government company
• Statutory corporation etc…
But pvt.enterprises are like;
Sole trader,
Joint Hindu family
Partnership
Joint stock company
And co-operative society.
24. Classification of business
activities
• On the basis of functions business
activities are classified in to two;
• Industry
• and commerce
• Commercial activities are again
classified as ;
• trade
and aids to trade
25. BUSINESS ACTIVITIES
INDUSTRY COMMERCE
Trade
1 EXTRACTIVE
2 GENETIC
3 MANUFACTURING
4 CONSTRUCTION
Aids to Trade
Home trade;
1)Retail trade
2) wholesale
trade
Foreign trade
1 import
2 export
3 Entrepot
Transport
Warehousing
Insurance
Banking
advertising
26. A brief review of the various types of
Business activities
• 1 Industrial activities or Enterprise;
It includes mining ,breeding,costruction of roads building,etc....
(manufacturing,mining,constructions )
. 2 Commercial activities;
commercial activities involve exchange of goods and services
like...transport, ware housing,banking,insurance and advertisement.
.3 Trading activities or firms;
it refers to purchase and sale of goods to earn profits
by the business men known as traders. They engaged in a)
Home trade - includes wholesale and retail
b) foreign trade- import-export and entreport
27. A brief review of the various types
of Business activities
• Service activities or enterprises;
These include those services
which facilitate smooth trade and also serve as
the back born of modern industry.
banking,insurance,transportation,warehousing,
insurance, packaging.
28. Types of industries
• Primary industry; it includes extraction
,producing and processing of natural
resource (extractive+ Genetic)
• Secondary industry are concerned with
processing materials which have already
been produced at the primary stage.
• Manufacturing and construction industry is
under secondary industry.
29. Manufacturing industry may
assume the following forms
• Analytical industry;petrolium refining
is an example of analytical industry.
• Synthetic industry; two or more
materials are mixed together in the
manufacturing operations to obtain
some new products.like soap,cement
etc
30. Manufacturing industry may
assume the following forms
• Processing industry;
raw materials are processed through a
series of manufacturing operations making
use of analytical and synthetic method)-
textile sugar and steel.
Assembly line industry;
in assembly industry, the finished products
can be produced only after various
components have been made and then
brought together for final assembly.
automobile watches,telivision are examples
32. Definition of trade
• Trade is that branch of commerce
which deals with exchange of goods
and services in terms of money
between different persons known as
‘traders’
33. Types of trade
• Trade may be classified on the basis of 1)
Geographical area covered
2) volume of trade transaction
• On geographical basis trade may be
classified in to two like internal trade and
external trade.
• On volume of trade basis trade is divided in
to two
• Wholesale & retail trade
34. Internal or home trade
• It refers to purchase and sale of goods
within the boundaries of a country.
• Wholesale trade; purchase and sale of
goods in bulk quantity and sell to retailers
at small quantity.
• Retail trade; selling of goods by the
retailer to the customer
