Learn: Business in the Real World

Welcome!Today we'll explore the topic of Business in the Real World. We'll look at what businesses do, why they exist, and the different types of businesses. Let's dive in!

What is the Purpose of Business?A business exists to produce goods (physical items like food or cars) or services (activities like haircuts or banking). Its aim is to meet people's needs (essential things like food) and wants (luxuries like holidays). Businesses also create opportunities for profit and employment.

EntrepreneurshipAn entrepreneur is someone who starts and runs a business. They often have traits like risk-taking, being highly organised, and showing strong determination. Entrepreneurs are motivated by goals such as earning profit, gaining independence, or pursuing their passion.

Types of BusinessBusinesses can be organised in different ways:Sole trader: One person owns and controls the business, with unlimited liability.Partnership: Two or more people share ownership, control, and profits; liability is shared.Ltd (private limited company): Owned by shareholders with limited liability; shares aren't sold to the public.Plc (public limited company): Shares are sold to the public; ownership is widespread.Not-for-profit: Focused on helping society rather than making profit.

Business Aims and ObjectivesBusinesses set aims (long-term goals) and objectives (short-term targets). Common aims include making a profit, surviving in competitive markets, growing, increasing market share, satisfying customers, and acting ethically.

StakeholdersStakeholders are groups or individuals who are affected by a business. They include owners, employees, customers, suppliers, and the local community. Each has different aims, which can sometimes lead to conflicts. For example, owners may want profit, while employees want higher wages.

Location FactorsChoosing a location is important for businesses. Factors include:Market: Being close to customers.Labour: Availability of skilled workers.Raw materials: Access to essential resources.Competition: Avoiding oversaturated areas.Cost: Affordable premises and operating costs.

Business PlansA business plan outlines how a business will achieve its goals. It includes sections such as market research, financial forecasts, and strategies. Business plans help attract investors and reduce risks but can take time and money to prepare.

Review Time!Great work! You've learned about business purposes, entrepreneurship, types, aims, stakeholders, location factors, and business plans. Now let's test your understanding with a few questions.