Business Activity…what is it???
Business activity is providing goods and services to satisfy consumer needs and wants.
‘Needs’ and ‘wants’, what are those?
Needs…what we need to survive, and that would be the stuff like food, drink, and water, basically anything that we can’t survive without. No! Computers do not count…as said, computers would apply as a ‘want”, it is what we would like but do not need for survival.
Okay, then what is adding value?
Well, for starters, you can also call this “Value added”, but then, it is the same thing. Anyways, back to the question here, value added is not the same as profit, it’s the difference between the selling price of a completed item and the value of the inputs or bought in materials for components.
Basically, a good example would be…well…**thinks**…matchsticks! Yeah, matchsticks, how is related to what we are talking about you ask? Well, as an example this would be the most commonly used because it’s so easy explain in little words! As I was saying, you buy some logs from a factory and the logs…let’s say…they cost…hmmm, $1,000, and then the logs are cut down in match sticks, then you add phosphorus on its end (and yes, those ends that light up are phosphorus by the way), then you pack the matches into boxes then you sell them to customers in your shop for $4,000. Where did the extra money come from you ask? Well, the extra $3,000 that appeared on the price would be the value added. If you are looking for the value added, all you do is do this, $4,000-$1,000= $3,000 and there you have your added value!
Okay, okay! Well, what is this whole ‘meeting customer needs’ thing?
Well, brace yourselves because, this is going to be a big talk then. =)
Customer service, well, it’s more expensive to attract a new customer than to keep an existing customer. So that is why, as an important objective of the business is to keep its existing customer base.
Well, since in today’s business climate, many products are similar, making it more difficult to show how one product is different from another. So for a business to stand out for competitors it may consider using other promotional activities to add extra value to the product, which could invoke providing good customer services. This is good since customers are important to every business, they buy the goods that the business produces or the services that the business provides, without them, a business will make losses and will eventually fail.
So…a good customer service means not only producing a good quality product that meets the needs of customers but also the following:
-Giving advice about the product.
-Delivering goods for customers.
-Providing product information.
-After-sales service.
Okay, you will also have to know about the purpose of business activity in terms of the objects of non-profit making activity, private enterprise and public enterprise.
Let’s start of with the ‘Non-profit making activity’
Its not aiming to make money (could be to provide a service. e.g. schools…). They have income but it is invested in the infrastructures, paying, staff and resources, the business itself does not pay owners or shareholders.
Okay, next up is the ‘Private enterprise”:
It is the basis of a free market capitalist system, it is a business unit established, owned, and operated by private individuals for profit, instead of by or for any government or its agencies.
The “Public Enterprise” is next up…
Government enterprises and public corporations are in either case organization which is entirely, or mainly, owned, and/or controlled by the public authorities consisting of establishments which by virtue of their kind of activities, technology and mode of operation are classed as industries.
Thank you, this is the end of this post, thanks for reading! <3
