BMGT 110 1 Objectives of business a Survival b Growth d Profit c Social responsibility appliances healthcare travel making a profit manage a business period of time 2 Survival is the goal to every business a As you survive you want to GROW and as your growing you have more SOCIAL RESPONSIBILITY and PROFIT is our goal 11 Goods tangible products such as computers food clothing cars and 11 Services intangible products that cant be held in hand such as 11 Business any activity that seeks to provide goods and services while 11 Entrepreneur a person who risks time and money to start and 11 Revenue TOTAL amount of money a business TAKES IN during a 11 Profit amount of money a business EARNS above and beyond what it spends for salaries and expenses 11 Loss occurs when a business expenses are more than revenue 11 Risk chance an entrepreneur takes of losing time and money on a business a The more risks you take the greater your reward should be 11 Standard of living amount of goods and services people can buy with the money they have stricter govt regualtions a Goods cost more in different countries because of higher taxes and 11 Quality of life general well being of a society in terms of political freedom natural environment education safety and rewards that add to the satisfaction that other goods and services provide a Having a high quality of life requires the combined effort of BUSINESSES NONPROFIT ORGANIZATIONS and GOVT AGENCIES 11 Stakeholders all the people who gain or lose but the policies and activities of a business and whose concerns the businesses need to address Ex bankers customers media suppliers employees govt leaders surrounding community need to accommodate all these people 11 Outsourcing contracting with other companies ofen in other countries to do some of the firms work 11 Insourcing foreign companies opening offices and factories in the United states 11 Nonprofit organizations organization whos goal does not include making profit for owners or organizers a Social entreoreneurs use business principles to start and manage non profits and address social issues 11 Factors that affect the business environment a Global business b Economic and legal c Social d Technology e Competitive 11 Trends in business a Rise of info and tech c Doing business 24 7 d Educated consumers e Aging workforce f Increasing diversity b Globalization we have a heterogeneous population g Pyramid vs web a hierarchical model where bosses are at the top and workers at bottom and now we have a whole web of authority different structure h Self directed empowered employees i Communication skills j Decision making skills k Teamwork l Leadership m Continual learning 11 Entrepreneurship vs working for others a To succeed in business rise through the ranks of large companies b Factors of production i Land or natural resources used to make homes cars other products ii Labor workers people are starting to be replaced with technology 11 The Business Environment the surrounding factors that either help c Capital machines tools buildings d Entrepreneurship e Knowledge most important factor or hinder the development of business a Economic and legal environment i Freedom of ownership ii Contract laws iii Tradable currency iv Min tax regulations b Technological environment i Information tech ii Databases iii Barcodes iv Internet c Competitive environment i Customer service ii Stakeholder recognition iii Employee service iv Environment concern d Social environment i Diversity ii Family changes iii Demographic changes e Global business environment i Global competition ii Free trade iii The quality imperative entrepreneurship 11 Economic and Legal Environment How to lessen the risks of a a govt can minimize spending and keep taxes and regulations to a minimum then policies tend to favor business i one way for govt to promote entrepreneurship is to ALLOW PRIVATE OWNERSHIP OF BUSINESSES i also gotvt s of developing countries should not interfere with the free exchange of goods and services ii establish a currency that is tradable in world markets iii minimize corruption in business iv passing laws that enable business people to write enforceable contracts 11 The technology environment a Technology anything that makes business processes more effective efficient and productive b Productivity the amount of output you generate given a certain amount of input of hours worked i The more you can produce in a given time period the more you are worth to companies c E commerce buying and selling goods over the internet i Two major types 1 Business to consumer B2C 2 Business to Business B2B d Database electronic storage file for information e Identity theft obtaining of individuals personal information such as social security and credit card numbers for illegal purposes 11 The competitive environment a Empowerment giving frontline workers the responsibility authority freedom training and equipment they need to respond quickly to consumer requests 11 The Social environment a Demography statistical study of the human population with regard to size density race gender income b paying social security to senior citizens in the future will draw huge amounts of money from the working population 11 The global environment a has greatly improved living standards all over the world b climate change the movement of the temperature of the planet up c greening saving energy and producing products that cause less harm or down over time to the environmen BMGT 110 HOW TO FORM A BUSINESS 1 3 major types of business a Sole Proprietorship a business that is owned and usually managed by one person MOST COMMON and easiest to explore i Advantages Ease of starting and ending the business Being your own boss Pride of ownership Leaving a legacy Retention of company profit No special taxes profits of a sole proprietorship are taxed as the personal income of the owner and he she pays normal income tax on it they do have to pay the self employment tax ii Disadvantages 1 Unlimited liability risk of personal loss Unlimited liability the responsibility of business owners for all the debts of the business 2 Limited financial resources 3 Management difficulties 4 Overwhelming time commitment 5 Few fringe benefits no paid health insurance disabilities insurance pension plan sick leave or vacation pay 6 Limited growth 7 Limited life span b Partnership a legal form of business with two or more owners i General partnership all owners share in operating the business
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