Introduction to business

1. 1
What is Business?

2. 2
Business Objectives
 Public Welfare
 Profit Motive
 Social Responsibility
 Economic Development

3. 3
Walmart vs Kroger Case

4. 4

5. 5

6. 6

7. 7

8. 8

9. 9

10. 10

11. 11
Kroger vs Walmart Case
 Raising funds through stocks
 Right mix of product
 Right price for profit generation
 Rev – Cost = Profit
 How Walmart is challenging Kroger
 Customer’s selling their stocks
 Good Quality at Lower price

12. 12
Kroger vs Walmart Case
 Kroger’s Strategy
 Use of IT & decrease operating Costs
 Wider Selection of Products
 New & attractive stores
 Future Outcomes
 Retaining stockholders?

13. 13
Chapter 1
What is Business?
1. Differentiate the three meanings of business as commerce,
occupation and organization and identify the four main kinds of
productive resources.
2. Understand the forces of supply and demand determine fair or
market price.
3. Appreciate how a company’s business model is the source of
its competitive advantage and the difference between profit
and profitability
4. Recognize the way specialization and the division of labor
through the “invisible had of the market” lead to increasing
profit and wealth.
5. List the reasons why business organizations are created to
structure business exchanges and facilitate business
commerce.

14. 14
Chapter 1
What is Business?
Definitions of Business
 Business has three dimensions of a meaning
 As commerce
 An occupation
 An organization

15. 15
Chapter 1
What is Business?
Definitions of Business
 Business as a commerce is the process that people
produce, exchange and trade goods and services

16. 16
Chapter 1
What is Business?
Definitions of Business
 Business as an occupation is the acquired set of
specialized skills and abilities that allows people to
create valuable goods and services

17. 17
Chapter 1
What is Business?
Definitions of Business
 Business as an organization is the system of task
and authority relationship that coordinates and
controls the interactions between people so that
they work toward a common goal

18. 18
Chapter 1
What is Business?
Definitions of Business
 Business as a system is a combination of business
commerce, occupations, and organizations that
produces and distributes the goods and services
that create value for people in a society

19. 19
Chapter 1
What is Business?
Factors of Production
 Regardless of meaning there are four crucial
ingredients or productive factors or resources of
land, labor, capital and enterprise that are needed to
profit from business

20. 20
Chapter 1
What is Business?
Factors of Production
 These four productive factors or resources of land,
labor, capital and enterprise that are needed to profit
from business and are limited in supply (scarcity)
 A company must use them efficiently and effectively
to produce goods and services

21. 21
Chapter 1
What is Business?
 Together, the cost of acquiring and using these four
resources to make and sell goods and services
determines a company’s operating costs

22. 22
Chapter 1
What is Business?
 Owners/managers are the enterprise of the
business, while the people are the labor and the
capital buys materials, machinery
 The land may provide a specific location or a URL in
cyberspace.

23. 23
Chapter 1
What is Business?
 These resources allow for the creation of a product
and/or service that customers value a price

24. 24
Chapter 1
What is Business?
 The company’s business model not only outlines the
plan for these resources but creates a competitive
advantage in the value of its product and
generates profitable sales revenue
 By reinvesting the profits the business increases its
capital and contributes to the wealth of the owners

25. 25
Chapter 1
What is Business?
 All business activity is self-interested and
competitive, and this competition may benefit
people and society when it leads resources to be
employed in their most profitable use

26. 26

27. 27
Blockbuster Video Chain
 How Blockbuster differentiated itself?
 Display and spacious
 Use of technology (Barcode & Scanner)
 Results
 70,000 to 80,000 $ revenue
 20,000 to 30,000 $ operating costs
 One of the 100 fastest growing business in
Fortune 500
 Largest video store in world with 5000 locations