What is Business? Meaning Definitions Features of Business- BlackBout

                                    What is Business?

Introduction

What is Business?

Business is the most important activity of human beings. It is the means of livelihood. Almost all the people engage themselves in making, buying, selling and distributing goods and services for generating incomes. Almost every business involves risk and uncertainty. Some people don't know what is business. Effective management of risk and uncertainty is the key for business success. The successful business operation in the economy reflects prosperity of the nation. It provides large employment opportunities and utilizes available resources economically. It increase purchasing power and develops living standard for people. It brings comfort and satisfaction for the people and ensures peace, prosperity and progress of the country. It helps in earning foreign currency and strengthens foreign relation. Hence, the development of the business increases prestige of the people and nation.

Meaning and Definition

Meaning and Definition

The term "business" refers to all the economic activities carried on by people and organisations for generating income. Business is concerned with producing and distributing goods and services for earning profit. It is regular process of exchanging goods and services which involves risk and uncertainty. It is the mutual effort of industry and commerce. Industry is concerned with producing goods and commerce is concerned with distributing the goods and services. In fact business is an economic activity aimed at fulfilling the needs and wants of customers through the supply of goods and services for their satisfaction.

From the introduction and definition of what is Business, it is clear that the business is the economic activity of individual and organisation aimed at earning profit through the production and distribution of goods and services.

Characteristic of Business

Characteristic of Business

The following are the notable characteristics or features of business:

                    1. Economic activity: Business is an economic activity which involves in exchange of goods and services for money. It does not include non-economic activities which are not directed for generating income.

                    2. Production and distribution: Business involve in production and distribution of goods and services. The production and distribution of goods and services are carried on for the satisfaction of the customers.

                    3. Profit motive: Profit is the essence of business. The activities relating to production and distributing of goods and services are carried on with the aim of earning profit.

                    4. Risk and uncertainty: Every business activity involves risk and uncertainty to some extent. The risk of loss is ever-present in every business activity and hence there is no certainty that the business activity always results into profit.

                    5. Regular transactions: Every business performs its transaction on regular basis. It makes production and distribution of goods and services to the society continuously.

                    6. Customer satisfaction: Every business activity is centered on customer service and satisfaction. No business can exist over a long period of time without satisfying the needs and wants of the customers.

Importance of Business

Importance of Business

Business is the wheel of economic development. It is the reflection of civilization. It equally contributes to the individual, society and nation as a whole. The business is important due to the following reason:

                    1. It is the means of livelihood: Business is the sources of livelihood of many people. Every person lives in the society by generating incomes through the production and distribution of goods and services.

                    2. It increases living standard: Business increases earning of a person and his family. It increase purchasing power and develop life standard of a family, which makes life full of comfort and happiness.

                    3. It generates employment opportunity: Business is the means of overcoming unemployment problem of the society. Due to the establishment and operation of a number of industrial and trading units, a large number of people get employment opportunities.

                    4. It utilities resources: Business utilizes natural, human, physical and financial resources for the production and distribution of goods and services. The proper utilization of these resources helps to generate large employment opportunities and uplift economic development of the country.

                    5. It increase government revenue: Business contributes a lot to increase the government revenue. A large number of industrial, trading and services businesses pay income trading and service businesses pay income tax, custom duty, excise duty and VAT, which increase the revenue of the government.

                    6. It earns foreign currencies: Business is a main source of earning foreign currencies. Manufacturing industry, tourism industry and other service businesses export their products and services to the foreign markets and earn foreign currencies for the nation.

                    7. It maintains peace and prosperity: Business increases earning capacity of the people and makes their life comfort and happy. As a result, it maintains economic stability, peace and prosperity in the society.