What is business?
Business is an economic system in which goods and services are exchanged for one another or money, on the basis of their perceived worth. All business needs some form of investment and a sufficient number of customers to whom its output can be sold at profit on a consistent basis.
Stephenson said that a business is the regular production or purchase and sale of goods undertaken with an objective of earning profit and acquiring wealth through the satisfaction of human wants. Also business is a human activity directed towards producing or acquiring wealth through buying and selling of goods acclaimed by Lewis Henry. Nevertheless, Dicksee said that business refers to a form of activity conducted with an objective of earning profits for the benefit of those on whose behalf the activity is conducted.
Warren Buffet wrote that good jockeys will do well on good horses, but not on broken-down nags. And he stressed that it is the reputation of the business that remains intact. The main point of business is carried on with the intention of earning a profit. The profit is a reward for the services of a businessman and it is his ultimate goal.
Business is classified according to its field of operations. In agriculture and mining, the business is concerned with the production of related products, such as livestock and plants or minerals. A financial business will include banks and other companies that generate profit through investment and management of capital. In the world of information the business generated profits primarily from the resale of intellectual property and includes movie studios, publishers and packaged software companies. Manufacturers produce products, from raw materials or component parts, which they then sell at a profit. Companies that make physical goods, such as cars or pipes, and other manufactured products are involved in the manufacturing business. Real estate business generates profit from the selling, renting, and development of properties comprising land, residential homes, condo units and other kinds of structures. The retailers and distributors who will act as the bridge between the goods produced by manufacturers to the intended consumer, generating a profit as a result of providing sales or distribution services. Service based business offers intangible goods or services through utilizing the skills and expertise of individual that will render the offered services and normally create a profit by charging for labour or other services provided to government, other businesses, or consumers. Organizations ranging from house decorators to consulting firms, restaurants, and even entertainers are types of service based business. Transportation business delivers goods and individuals from location to location, generating a profit on the transportation costs, this usually in the form of land travels, sea navigation or air transport. Other type of business is in the formed of utilities that will produce public services such as electricity or maintenance, usually under a government agreement.
The competent and effective function of a business should have a good management and Management is one of the studies in the world of business. The major branches of management are financial management, strategic management, marketing management, human resource management, production management, service management, operations management and information technology management. Those branches of management will study in how business will be successful and effective.