Business is a word which is commonly used in many different languages. But exactly what does it mean? The concepts and activities of business have increased in modern times. Traditionally, business simply meant exchange or trade for things people wanted or needed. Today it has a more technical definition. One definition of business is the production, distribution,and sale of goods and services for a profit. To examine this definition, we will at its various parts.
First, production is the creation of services or the changing of materials into products. Next, the product need to be moved from the factory to the marketplace. This known as distribution.
Third is the sale of goods and services. Sale is the exchange of a product or services for money. Goods are products which people either need or want and the services are activities which a person or group perform for another person or organization.
Business, then, is a combination of all these activities : production, distribution and sale.
However, there is one other important factor. This factor is the creation of profit or economic surplus. Profit is the manoy that remains after all the expenses are paid. Creating an economic surplus or profit is, therefore, a primary goal of business activity.
- Business is the combination of all these activities such as a production, distribution and sale for a profit.
- Production is the the creation of services or the changing of materials into products.
- Distribution is the moving of goods from the factory to the marketplace.
- Sale is the exchange of a product or service for money.
- Profit is the money that remains after all the expenses are paid.