Important scope of the business
Definition of business:
According Hughes and kapoor definition of business:
A business is an organised effort of an individual to produce and sell, for a profit, the goods and
services that satisfy society’s needs.
OR
A business is a particular organisation.
An american business experts and authors Strauss and Attn er define business as:
A business is an organisation which is used to producing goods and services in order to make
profit.
On the other hand definition of business in a better and a comprehensive way wheeler define as:
An institution is responsible to provide goods and services to the consumer in order to gain a
private profit.
According to Thomas Evelyn definition of business is that a business embraces all those functions
involved in the making, buying and transporting of goods.
H.Haney defines business as human activity towards providing or acquiring wealth through buying
and selling goods. But in this definition the manufacturing and services have been ignored. It is the
only good for defining marketing.
The best and elaborate definition have been given by F.C Hooper:
The field of business is a complex of industries which produce, manufacture , distribute goods,
finance
banking insurance and transportation which promote the business activity world of business as
a whole.
Business activity has become very important and very complicated under the influence of a fast
changing world. The fastest development and growth of the business stem for this reason.
3.Ever changing and increasing demands of the consumer has created new and great
Business and objections:
The practice of business has been controversial over a long time. Around 2500 years ago a plateau did
not favour business. His pupil Aristotle also disliked this he thought it is an amoral and asocial
activity. His main object was to make more profit. In the modern era in the US there is a section of
young men. According to them, business is the favourite field of those who have little or limited
talent. In other words gifted and talented people go in for research, management, engineering and
medical discipline. In the survey it is to be noticed that in the country only twelve percent of young
men preferred business. A majority of people disliked because they thought that a businessman
exploited customers, enslaved employees, stressed managers to make profit at any cost and always
ran for wealth. Despite all these objectives, business has its universal importance.
Scope of Business:
The scope and range of business includes production, marketing, banking, finance, transportation,
warehousing, insurance and information. These factors of business are described below:
Production:
Business function starts with the planning of production which is the conversion of raw material
from one form to another form. It requires purchasing machinery, equipment etc. The production
which is business activity has the four factors:
Land
Labour
Capital
Entrepreneurship
Better production depends on proper and timely planning, minimisation of cost, consumer taste and
many more possible steps for better production have to be taken.
Banking/Finance:
Banking and finance are part and parcel of business. Most of the loans are provided by the banking
system. There are three types of banks
Capital
Loans or bonds
Retained earning
Transportation:
Transporting is such an important activity that no business can be performed without it.Transporting
starts immediately after production. It refers to moving goods from one place to another place.
It helps the producer to sell their goods to the far and needy markets.quick and modern means have
made it possible to send goods in any part of the globe. There are three types of routes of
transportation
Land
Air
Sea
Marine transport is the lowest transport and used for shipping heavy goods. Air transport is a quick
way of transport but highly costly. They used to carry light goods. Land transport is vital for inland
trade. The ways of land transport covers carriages, roads etc.
Ware Housing:
Without storing, commercial functions can not work. Goods must be stored after production and
before they are sold. There are many kinds of warehouses and stores where surplus goods are
stored and awaiting for their demand. The place where goods are stored is known as a warehouse
or store. Shops, showroom, granaries, cupboards are all different types of warehouses. Business
houses use facilities of different types of stores and warehouses some of which are bond
warehouses, public warehouses, private warehouses and cold storage.
Information:
Business extends to getting information from various sources and media. It requires information at
every stage. Well informed businessman is more successful than uninformed. There are two types
of information:
Primary information
Secondary information
Primary information:
It is the first hand information received through research, study, observation, analysis, experiment
etc.
Secondary information:
It is obtained through other sources like libraries, books,newspapers and others.
Insurance:
Risk is inherent to business. Business risks include theft, fire sinking of the ship, change in
prices, government policies,and restrictions and many more. There are two types of risks:
Insurable risk
Uninsurable risk
Insurable risk:
Those risks which are covered under an insurance policy are referred to insurable risk
Uninsurable risk:
Insurance that cannot have cover of insurance known as uninsurable risks.
Grading and Standardization:
Standardisation refers to bringing the goods and services to a certain criterion, measurement,
established model or accepted norms or values. It creates uniformity and facilitates buying
and selling, storing and transporting. Grading may take the form of brands, weights, heights,
volumes, qualities and varieties.
Trade (Buying and selling):
Trade has a pivotal role in business. Trade refers to buying and selling. It covers imports,
exports, retailing, wholesaling and brokerage. He must be aware of customers taste trends
and preferences.
WareHousing:
Without storing, commercial functions can not work. Goods must be stored after production
and before they are sold. There are many kinds of warehouses and stores where surplus
goods are stored and awaiting for their demand. The place where goods are stored is known
as a warehouse or store. Shops, showroom, granaries, cupboards are all different types of
warehouses. Business houses use facilities of different types of stores and warehouses some
of which are bond warehouses, public warehouses, private warehouses and cold storage.
Information:
Business extends to getting information from various sources and media. It requires
information at every stage. Well informed businessman is more successful than uninformed.
There are two types of information:
Primary information
Secondary information
Primary information:
It is the first hand information received through research, study, observation, analysis,
experiment etc.
Secondary information:
It is obtained through other sources like libraries, books,newspapers and others.
Insurance:
Risk is inherent to business. Business risks include theft, fire sinking of the ship, change in
prices, government policies,and restrictions and many more. There are two types of risks:
Insurable risk
Uninsurable risk
Insurable risk:
Those risks which are covered under an insurance policy are referred to insurable risk
Uninsurable risk:
Insurance that cannot have cover of insurance known as uninsurable risks.
Grading and Standardization:
Standardization refers to bringing the goods and services to a certain criterion, measurement,
established model or accepted norms or values. It creates uniformity and facilitates buying
and selling, storing and transporting. Grading may take the form of brands, weights, heights,
volumes, qualities and varieties.
Trade (Buying and selling):
Trade has a pivotal role in business. Trade refers to buying and selling. It covers imports,
exports, retailing, wholesaling and brokerage. He must be aware of customers taste trends
and preferences.
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