COURSE CODE BUSA1111:
INTRODUCTION TO BUSINESS
LECTURE 1
What is Business?
• Definition:
A business is any organization or entity engaged in commercial, industrial, or
professional activities with the aim of earning profit and creating value.
• Examples of Business:
• 1. Retail Store (e.g., Walmart or a local grocery shop)
Activity: Sells consumer goods like food, clothes, electronics.
Goal: Make profit by buying goods in bulk and selling at a higher price.
• 2. Tech Company (e.g., Apple or a mobile app developer)
Activity: Designs and sells technology products or services like smartphones or software.
Goal: Innovate, attract customers, and generate high profits.
• 3. Restaurant
Activity: Prepares and serves food and drinks.
Goal: Provide good customer service and earn income from meals sold.
• 4. Freelance Graphic Designer
Activity: Offers design services to clients.
Goal: Earn income by providing professional expertise.
• 5. Manufacturing Company (e.g., Toyota)
Activity: Produces cars and sells them to dealers or customers.
Goal: Make profit through large-scale production and sales.
• Purpose of Business:
o Providing goods/services
o Generating profit
o Creating employment
o Innovating and solving problems
1. Providing Goods and Services
The primary function of a business is to offer goods or services that fulfill the needs and wants
of consumers.
• Goods are tangible items like food, clothes, electronics, etc.
• Services are intangible offerings such as education, healthcare, banking, and
transportation.
By doing this, businesses improve the quality of life and convenience for people in
society.
2. Generating Profit
Businesses exist to make a profit, which is the financial reward for taking risks and managing
operations.
• Profit is what remains after deducting all costs from the revenue earned.
• It’s essential for the survival, growth, and expansion of the business.
Profit also provides returns to investors and helps reinvest in better products,
technology, and services.
3. Creating Employment
Businesses are major contributors to job creation.
• They hire people to manage operations, create products, sell services, and handle
customer support.
• This employment helps people earn a living, support families, and contribute to the
economy.
As businesses grow, they often create even more opportunities across various sectors.
4. Innovating and Solving Problems
Businesses often drive innovation by developing new products, improving existing ones, or
finding more efficient ways to operate.
• They solve problems by addressing market demands, improving convenience, or
introducing solutions to real-life challenges.
• For example, tech companies innovate by creating smartphones or apps that help
communication, work, and entertainment.
• Core Activities of Business:
o Production
o Marketing
o Finance
o Human Resource Management
o Operations
1. Production
Production involves creating goods or services that the business offers to its customers.
• It includes acquiring raw materials, using labor and machines, and converting inputs into
finished products.
• In service-based businesses, production refers to preparing and delivering the service
efficiently.
Example: A car manufacturer assembling vehicles.
2. Marketing
Marketing is all about promoting and selling products or services to customers.
• It includes market research, advertising, branding, pricing, and sales strategies.
• The goal is to attract customers, understand their needs, and persuade them to choose
the business’s offering.
Example: A company running ads on social media to promote a new phone.
3. Finance
Finance deals with managing the money flowing in and out of the business.
• It involves budgeting, accounting, raising capital, managing cash flow, and making
investment decisions.
• Sound financial management ensures the business can operate, grow, and remain
profitable.
Example: Tracking expenses, preparing financial reports, or applying for a business loan.
4. Human Resource Management (HRM)
HRM is responsible for managing the people within the business.
• It includes hiring, training, motivating, and evaluating employees.
• HR ensures a skilled and satisfied workforce, which is essential for business success.
Example: Recruiting new staff, conducting performance reviews, or offering training
programs.
5. Operations
Operations refers to the day-to-day processes and systems that keep the business
running smoothly.
• It includes managing supply chains, maintaining equipment, ensuring quality control,
and optimizing workflows.
• Good operations management helps reduce waste, lower costs, and improve efficiency.
Example: A logistics company managing deliveries to ensure they arrive on time.
Characteristics / Features of Business
1. Economic Activity – Aimed at earning income.
2. Dealing in Goods or Services – Can be physical products or services.
3. Profit Motive – Primary goal is to make a profit (except non-profits).
4. Regularity – Must be done continuously or regularly.
5. Risk and Uncertainty – Involves business risks (e.g., loss, failure).
6. Legal and Ethical Practices – Operates under laws and moral standards.
7. Customer Satisfaction – Focused on meeting market needs.
8. Innovation – Adapts to changes in technology and consumer trends.
1. Economic Activity
Business is a money-making activity aimed at earning income through buying, selling, or
providing services.
2. Dealing in Goods or Services
Businesses offer tangible products (like clothes or food) or intangible services (like education or
transport).
3. Profit Motive
The main goal of most businesses is to earn profit, which supports growth and rewards owners.
4. Regularity
A business must be done continuously or on a regular basis, not as a one-time activity.
5. Risk and Uncertainty
All businesses face risks, like market changes or losses; success is never guaranteed.
6. Legal and Ethical Practices
Businesses must follow laws and ethical standards, like fair trade, safety, and honesty.
7. Customer Satisfaction
Success depends on meeting customer needs and keeping them happy with products or
services.
8. Innovation
Businesses must adapt and improve by using new ideas, technology, or methods to stay
competitive.
