Business study notes

Essay by JonorosieHigh School, 12th gradeA+, March 2004

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Business Notes:

Chapter 1 - the nature of a business

Role a business plays in society:

"±Employs people

"±Basis of nations economy

"±Brings technological change and innovation

"±Offers choices relating to work and consumption

"±Provides social interaction

Definition of a business:

To produce goods and services to add value in the process of production

Value chain is the concept that value is added at each stage of production process, as inputs are transformed into final products

Making profit is important to most businesses but not all. Some aim to provide the community with a service eg: the ABC (Australian broadcasting commission)

What is a small business:

"±Independently owned an operated

"±Controlled by owners or managers who also contribute most of the operating capital

"±Decisions are made by the owners or managers

Can also be defined as:

"±A non-manufacturing business employing less than 20 employees

"±A manufacturing business employing less than 100 employees

Medium sized businesses employ 20-99 people and a large business employs more than 200 staff.

Some times small and medium businesses are grouped together known as SME's (small and medium enterprises)

Small businesses play a vital role in Australia's economy. Over 1 million private sector business, employing 3.5 million people. non agricultural and small businesses make up 1/3 of Australia's economy and 40% of the total employment.

Contributions made by small businesses to the economy:

"±Create jobs

"±Help increase national income and living standards

"±Increase exports

"±Help growth in specific areas and strengthen local communities

"±Help innovate

"±Improve skills of the workforce

"±Strengthen family ties - 2/3 of small businesses are family owned

Business goals: 2 different business goals:

1.Financial goals

2.Social goals

Financial goals:

1. Breaking even: the 1st goal of any business in survival. Business needs to have enough revenue to cover its costs,