What is business? Its features and necessities.

 

What is business?

A business makes from the word “busyness”. It simply means that a person who is in business is busy in doing some economic activity. Whenever, I listen about business, I think of how to earn money with the selling of products and a wide variety of goods. 

The main aim for which every business sets up is customer satisfaction through which a firm gets its profit or recover its invested funds in the business. Profit is the source of business. It raises its goodwill and helps in the survival of firm.

Nowadays most of the people are commencing their business for a better standard of living. Business is the easiest way of earning money as it does not require any professional degree. The main quality which the business requires is the skills and creativeness of human resources.

Frequently, everyone is engaged earning profits with their sales maximization and also minimizes the risk which may cause threat to the business. It enables the expansionary flow of money supply in the economy of a country.  

Features of Business

Features are those factors which tells about the business in more descriptive way

These are given below:

1. Creating Utilities: Utility is the power which satisfies the consumer want. It is that satisfaction which consumers get from the consumption of a commodity. As more and more he consumes, his utility becomes lesser and lesser.

Now there are four types of utility:

(A) Form Utility: It is that utility which a consumer derives from consuming the changed form of the product. When all the material and accessories are combined to form a finished product or a consumer product, then it is said to be form utility.

(B) Place Utility: when goods and services manufactures, it directly reach at the market place. The transfer of goods from a production place to its consumption place is known as place utility.

(C) Time Utility: When goods are produced and transfer at marketplace, whole stock was not consumed but certain stock of goods need to be kept in the warehouses till its consumption, so the goods are kept for a longer time especially in the case of perishable items such as milk, cakes, bread and butter etc.

(D) Possession Utility: It is that value of commodity which defines that a consumer has a legal right on the products he buys. In simple words, it is the transfer of ownership from a seller to the consumer.

2. Risk Factor: The next and the most important feature is the risk involved in the business. It is clear that where there is business there is a risk. It is the important aspect of business which is unavoidable. Therefore, it is quoted that

“Where there is pain, there is gain”

Profit is the mere reward for handling and managing risk. It involves the recovery of all losses. If you want to recover from all these unbearable losses, you should choose an insurance premium plan.

3. Profit earning: As we know that “Necessity is the mother of Invention.” Same it is here, the necessity is the profit and the invention is the product which firms are selling. So, in order to survive in the market a business requires profit. Although, the main aim of a firm was not only to earn profit but also to give necessary services to the society.

4. Economic Activity: Business is an economic activity as it earns profit through sale of goods and services. Apart from goods and services, it also renders various auxiliary services, trading services and other types of services. Money is the root of all businesses. Therefore, business involves money. Without money the business would be non-existent.

5. Continuity in Dealing of goods and services: Every business should be made commercial at that time only when it transacts on regular basis. 

Again, it is quoted that:

“A single transaction would not become business.”

So, the main motive of the business is to maintain regularity in the business. Continuity of business also affects the goodwill of the firm or Organisation.

Necessity of business

The main importance of business is to fulfill various objectives. Industrialistion helps the economy to work much better than the before. Now, when there is a need to commence business? There are various factors which affects the economy of country. The only mode to reduce these affects is industrialisation, so that the economic conditions should improve.

The factors are as follows:

1.  Increase of Poverty: When a person is unable to fulfill their physiological needs, then their occur poverty. In India, It becomes as a disease. Each and every person becomes poor due to his inadequate level of income. It also affects the GDP of the country. It has an inverse relationship with the income of the consumer. A country with a higher income has less poverty rate and vice versa. There are various vicious circle of poverty in which a person cannot come out of it, if once stuck.

2. Unemployment: It is another condition for which business is set up. Business provides large number of employment opportunities through recruitments. In today’s life, everyone has proper knowledge but there are no seats in the Organisation. In this way, the skillful workers could not be hired. Most of the worker due to their laziness does not want to work and remain unemployed.

3. Better standard of living: It is the greatest effect which the business has not only in the individual life but also to the society. It raises the income of the society which would automatically increase the standard of the consumers or the society. Along with the earning money business should also focus on serving the society.
He must check and understand the needs aspirations of the people of the society. Business strategies should be formulated to increase demand so as to earn money and make the living better.         

 

FAQ

How do you start a business?

Once you have set up a mind of starting business whether it’s a sole trader, partnership or a Joint stock company, you can easily set up your business. Before starting business, you should know full detail about the type of business you are opening. You need to choose a specific steam in which you want to deal in. You can start business in both the manner with investment and without investment also. If you are commencing business by investment you can start your business by investing some capital and by collecting finance.

What is Modern Business?

A modern business is fully dependent on the technology and advancements. Most of the businesses are running online. One of the most famous examples is the “Affiliate Marketing”. All e-commerce websites such as “Amazon”, “Flipkart” and “Myntra” provides door to door services to a large group of customers all over the world. These websites also provide online payment services or delivery on cash.            
 

The last saying

Now lastly, I would like to conclude that Business makes the man grow in a society and reduce the crises and losses which occur in the organisation. He saves some part of his capital a form of reserve and use that reserve money for day to day operations of the organisation. After stability of business, the owners try to expand their business and open various sectors in different states and even countries.