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Business 10th Edition by Ferrell,Geoffrey Hirt,Linda Ferrell
Edition 10ISBN: 978-1259179396Business 10th Edition by Ferrell,Geoffrey Hirt,Linda Ferrell
Edition 10ISBN: 978-1259179396 Exercise 1
Who are the main participants of business? What are the main activities? What other factors have an impact on the conduct of business in the United States?
Explanation
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In order to obtain the end product, business enterprises carry out several operations which require the input of several people. This leads to the discussion on the main participants of a business and their activities and factors that impact the conduct of business in the USA.
Main participants in a business
The key people involved in the conduct of a business are its owners, employees and customers.
• Owners- They are the source of fund to commence a business and continue its operations. The monetary resources are offered in the form of cash or credit which is the cash inflow in a business.
• Employees- They work in the business enterprise to perform its activities by managing and controlling its operations. The owner is also involved in this performance or hires other qualified people to do the same. The goal of the employee is to increase revenue from the sale of company's products. For instance, a sales executive, chief executive officer and a logistics coordinator are employees of a business organisation.
• Customers - They are people who purchased the products of a business enterprise. For example, a person buying a car is called as customer.
Activities of key participants in a business
The three main activities of the key participants in a business are management, marketing and finance.
• Management - The management activities are performed by employees of a business enterprise. Employees cooperate with each other to perform activities in an efficient manner to increase profitability for the company. The main tasks of management include resource mobilisation and production. As a result, the employees have to plan and use systematic procedure to carry out tasks and control them appropriately to obtain the end product.
• Marketing - This activity is mainly aimed at the customers as the products of a business enterprise have to satisfy the customer requirements. The employees in a business enterprise called as marketers have to collect data about customers and their requirements. This information is used to plan and create products, apply suitable prices and distribution channels to be used. Promotional measures such as advertisements, discounts and coupons are used to inform customers about their products.
• Finance - A business enterprise requires fund to start up and conduct its activities. Owners who provide cash or credit are the part of this activity. They are the major beneficiaries if the business earns profits as they provide monetary resources. At the same time, they are the most adversely affected during losses. Finance involves fund mobilisation and its effective use. For instance, banks offer loan to business owners to fund their business activities.
Factors that impact the conduct of business in the USA
The factors which impact the overall operations of a business are listed below.
• Economy- In a society, resources such as natural materials, money and labour are distributed to produce goods. This ensures that the demand of a product is met with sufficient supply. In the USA, free enterprise system is adopted which is based on the market demand. The growth of a business and its failure depends on the demand for its products.
• Information technology - The use of technology ensures that the business operations are conducted efficiently. The USA is technologically advanced which acts as a competitive advantage for the business enterprises.
• Legal, political and regulatory forces- The public policies which are favourable for the operations of business enterprises depend on the stance of political parties which are in the power.
• Social responsibility and ethics - As customers are increasingly aware of the negative consequences of business operations on the environment and society, businesses have to comply with several legal norms. Failure to adhere to such measures is considered as socially irresponsible which hinders its reputation and leads to losses as customers switch to responsible companies. For instance, J, a pharmaceutical company has to organise a nationwide recall of its medicine T as it was found to be tampered with in one retail outlet. This increased the image of company J among the public.
• Competition - Several businesses produce similar products targeting same customer groups. This results in competition between businesses. Businesses have to devise strategies to promote their products and gain market share. Products with unique features tend to succeed due to its competitive advantage.
Thus, the key participants of a business are people who engage in its daily operations by performing a series of activities to reach the goal of earning profits. They are influenced by several external factors which impact the business operations.
Main participants in a business
The key people involved in the conduct of a business are its owners, employees and customers.
• Owners- They are the source of fund to commence a business and continue its operations. The monetary resources are offered in the form of cash or credit which is the cash inflow in a business.
• Employees- They work in the business enterprise to perform its activities by managing and controlling its operations. The owner is also involved in this performance or hires other qualified people to do the same. The goal of the employee is to increase revenue from the sale of company's products. For instance, a sales executive, chief executive officer and a logistics coordinator are employees of a business organisation.
• Customers - They are people who purchased the products of a business enterprise. For example, a person buying a car is called as customer.
Activities of key participants in a business
The three main activities of the key participants in a business are management, marketing and finance.
• Management - The management activities are performed by employees of a business enterprise. Employees cooperate with each other to perform activities in an efficient manner to increase profitability for the company. The main tasks of management include resource mobilisation and production. As a result, the employees have to plan and use systematic procedure to carry out tasks and control them appropriately to obtain the end product.
• Marketing - This activity is mainly aimed at the customers as the products of a business enterprise have to satisfy the customer requirements. The employees in a business enterprise called as marketers have to collect data about customers and their requirements. This information is used to plan and create products, apply suitable prices and distribution channels to be used. Promotional measures such as advertisements, discounts and coupons are used to inform customers about their products.
• Finance - A business enterprise requires fund to start up and conduct its activities. Owners who provide cash or credit are the part of this activity. They are the major beneficiaries if the business earns profits as they provide monetary resources. At the same time, they are the most adversely affected during losses. Finance involves fund mobilisation and its effective use. For instance, banks offer loan to business owners to fund their business activities.
Factors that impact the conduct of business in the USA
The factors which impact the overall operations of a business are listed below.
• Economy- In a society, resources such as natural materials, money and labour are distributed to produce goods. This ensures that the demand of a product is met with sufficient supply. In the USA, free enterprise system is adopted which is based on the market demand. The growth of a business and its failure depends on the demand for its products.
• Information technology - The use of technology ensures that the business operations are conducted efficiently. The USA is technologically advanced which acts as a competitive advantage for the business enterprises.
• Legal, political and regulatory forces- The public policies which are favourable for the operations of business enterprises depend on the stance of political parties which are in the power.
• Social responsibility and ethics - As customers are increasingly aware of the negative consequences of business operations on the environment and society, businesses have to comply with several legal norms. Failure to adhere to such measures is considered as socially irresponsible which hinders its reputation and leads to losses as customers switch to responsible companies. For instance, J, a pharmaceutical company has to organise a nationwide recall of its medicine T as it was found to be tampered with in one retail outlet. This increased the image of company J among the public.
• Competition - Several businesses produce similar products targeting same customer groups. This results in competition between businesses. Businesses have to devise strategies to promote their products and gain market share. Products with unique features tend to succeed due to its competitive advantage.
Thus, the key participants of a business are people who engage in its daily operations by performing a series of activities to reach the goal of earning profits. They are influenced by several external factors which impact the business operations.
Business 10th Edition by Ferrell,Geoffrey Hirt,Linda Ferrell
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