Explain meaning and features of business fybcom sem 1



Commerce Paper I (Introduction to Business)

Explain meaning and features of business fybcom sem 1

Q2. Explain meaning and features of business.

Meaning :- According to L.H. Haney, “Business is a human activity directed towards producing or acquiring wealth through buying and selling activities.”

1. Economic activity :

Business is a form of an economic activity. It is the fruitful occupation for millions of people around the world like traders, bankers, industrialists, manufacturers and many more including professionals and those employed.

2. Regularity in dealing :

Business activity is carried out regularly. It is not merely sale or exchange but the regularity or continuity of such dealings that constitutes business. A single transaction does not constitute business. The production or exchange of goods or services for a price is undertaken regularly and continuously in business.

3. Profit motives :

Business is an income oriented activity. Every businessman expects profit from the transactions. The main object of business is to earn profit. Businessman earns profit from the business transactions and the buyer satisfies his wants of goods and services.

4. Organized activity :

Business is an organised activity concerned with production and distribution of goods and services. A firm must conduct consumer research to identify consumer needs and wants. There is a constant need to monitor customer needs and wants, and accordingly produce and distribute goods and Service. Business has to be conducted systematically with continuous research and development. It should be organized in a systematic manner so that business objectives can be achieved successfully.

5. Degree of scale :

Business can be undertaken at varied degree of seals ofoperation. Some firm like Sole trading concerns may undertake business on a small scale and that too in a local area. However, some firms, like joint stock companies may undertake business on a large scale, even at a global level.

6. Risk and Uncertainties :

Business activities are always risky and uncertain. A business is likely to suffer huge loss due to a number of possible reasons such as change in fashion, tastes, preferences, government policies, technology, recession in the economy, natural calamities etc. All business risks can’t be insured. A business, however, can minimise risks through proper foresight and planning.

7. Societal Interest :

At present, business firms place emphasis on “societal concept” of business. Business make efforts to preserve and promote customers’ and society’s well-being. Business unit try to achieve a balance between profit + Consumer satisfaction + public Interest. Therefore, increasing efforts are made to produce ecofriendly products to satisfy consumer.

8. Social Responsibility :

Professional business firms are conscious of their social responsibility. The firm try to fulfill their social responsibility towards various groups. It needs the support of the groups i.e. investers, employees, consumers, creditors and so on. It can’t function without an active participation from these social groups. This feature of business in getting more importance in today’s era of a globalization.

9. Customer Satisfaction :

Modern business world is a consumer oriented. Customer is the King and Centre of all marketing activities. Professional business firms adopt customer oriented approach in their business operations. Business firms give importance not only to profit earning but also to customer satisfaction. Customers would be satisfied only when they get real value for their purchases.Business firms have to take care of not only customer satisfaction but also have to delight the customers by providing better and additional services.

10. Creative :

Modern business is creative in nature. These days, consumers can’t be satisfied with the same type of goods and services. Hence business organizations have to be innovative or constantly search new ideas and proposals.

11. Dynamic :

Business is a dynamic activity. There is a certainty of change in business Dynamic forces are at work from day to day. Within business new products, methods, innovations in management cause ever changing adjustment of policies and administration. From outside forces such as government regulation, war, changing consumer income and new development in science and an art.

12. Government Control :

Business organizations are subject to government control. The government of each country enacts laws and regulations to control and regulate business activities. Business organisations are expected to adhere to such laws.

13. Buying and Selling :

All business activities are directly or indirectly connected with transfers or buying and selling of goods and services. Business is useful to buyers and sellers. Businessmen as Seller of goods and services, provide convenience and satisfaction to buyers through provision of form utility, place utility and time utility. In return for the supply of utilities, businessmen receive profit benefit from the buyers

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