Introduction to Business

潘雨亭
panyuting@bfsu.edu.cn
Unit 1 The nature of business
• What is business activity?
 The nature of business activity
External influences/Environmental factors: Population trends,
government, economic climate, world events, social factors,
legislation and regulation, pressure groups, competition,
consumers.

Business Activity
Input (factors of Function: Output:
production):
Operations (production) Goods
Land Marketing Services
labor Finance Waste
Capital Administration
Entrepreneurship Human resources (HR)
Research and Development
(R&D)
Business resources
FACTORS OF PRODUCTION
• Land
• Labor
• Capital
• Enterprise
Business functions
• Production
• Marketing
• Finance
• Administration
• Human resources
• Research and development(R&D)
Business functions Brief explanation

Operations Changing natural resources into products such as producing coal in a

(production; coal mine, constructing a house in a building site, etc.
manufacturing)
Marketing activities, such as market research, advertising, promotion,
Marketing
distribution, etc.
Control of money in a business, recoding financial transactions,
Finance
controlling the flow of money, etc.
Communication, producing documents for meeting, dealing with
Administration
enquiries, arranging visits, etc.
HRM (human Management of people, such as recruitment, training, health and
resource safety, payment system and performance assessment, etc.
management)

R&D (research and Research on new products, research on new technology, etc.
development)
What does business activity produce?
CONSUMER GOODS
• Durable goods
• Non-durable goods

CAPITAL GOODS
External factors
• Government
• Economic climate
• World events
• Pressure group
• Consumers’ tastes
• Changes in population
• Competition
• Social factors
• Environmental factors
• Legislation and regulation
External factors Brief explanations

Influences may come from government policy, government spending, government

The government
investment on infrastructure, etc.

Economic climate Businesses are influenced by stable or unstable economic conditions.

World events / affairs Influences from drought for growing rice, flooding, war, etc.

Competition Local competition, national competition, international competition, etc.

Consumers Influences from consumer taste changes, low-fat food, green food, new styles of wearing, etc.

Population trends Influences from such factors as ageing trends, single-parent family, more minority groups, etc.

Influences from changes in law and regulations for producing or exporting a certain product,
Legislation and regulation
smoking, etc.

Environmental factors Influences from waste disposal requirement, using recycled materials, etc.

Pressure groups Influences may come from stakeholders like local communities, money lenders, etc.

Influences from changes in social factors in society such as more women working than in the
Social Factors
past, unmarried parenting, etc.
Satisfying needs and wants
Markets
• Consumer goods markets
• Markets for services
• Capital goods markets
• Labor markets
• Commodity markets
Specialisation
The importance of money
• Barter system
• M4
Classification of business activity
• Primary production
• Secondary production
• Tertiary production
What are the trends in business activity?
• De-industrialisation
Unit 2 Enterprise
• Small business
Entrepreneurs
• Owns
• Organizes
• Risk taker
Risk, rewards and opportunity cost
Characteristics of entrepreneurs
• Self-confidence
• Self-determination
• Being a self-starter
• Judgment
• Commitment
• Perseverance
• Initiative
Motives for becoming an entrepreneur
• Financial reward
• Independence
• Building a business
• Job satisfaction
• The product
Government support for enterprise and
entrepreneurs

• Business Link
Unit 3 Business ideas
Finding an initial idea

• Business experience
• Personal experience
• Skills
• Lifestyle choices
Identifying a product or market niche
Franchises
• Franchisor
• franchisee
• License
• A recognized brand
• A start-up package
• Materials
• Marketing support
• Ongoing training
• Business services
The benefits and costs for franchisors and
franchisees
Trademarks, copyright and patents
Unit 4 Business plans
• Why write a business plan?
The contents of a business plan
• An executive summary
• The business and its objectives
• The business opportunity
• The market
• Personnel
• Buying and production
• Premises and equipment
• Financial forecasts
• Finance
Sources of information and guidance
• Friends, family and work colleagues
• Bank managers
• Accountants
• Small business advisors
• Business Link
• Local Enterprise Agencies