TOPIC 1 NATURE OF BUSINESS
Role of Business
The nature of business
- producing goods and services
- profit, employment, incomes, choice, innovation, entrepreneurship and risk, wealth and quality of life
Types of businesses
Classification of business
Factors influencing choice of legal structure
- size: small to medium enterprises (SMEs), large
- local, national, global
- industry: primary, secondary, tertiary, quaternary, quinary
- legal structure: sole trader, partnership, private company, public company, government enterprise
Factors influencing choice of legal structure
- size, ownership, finance
Influences in the business environment
- External influences: economic, financial, geographic, social, legal, political, institutional, technological, competitive situation, markets
- Internal influences: products, location, resources, management and business culture
- Stakeholders
Business growth and decline
- stages of the business life cycle: establishment, growth, maturity, post-maturity
- responding to challenges at each stage of the business life cycle
- factors that can contribute to business decline
- voluntary and involuntary cessation - liquidation
