The term ‘business’ typically refers to the development and processing of economic values in society. Normally, the term is applied to a portion of economic activities whose primary purpose is to provide goods and services for society in an effective manner. It is also applied to economics and commercial activities of institutions having other purposes. Business principally comprises all profit-seeking activities of the organization which provides goods and services that are necessary to the economic system. It is the major economic pulse of a nation, striving to increase society’s standard of living.
Business is an organization that makes a distribution or provides any article or service to the customers, who are members of the society. Business aims to satisfy the needs of the customers as they are able and willing to pay for these purposes. A business may be defined as “the organized effort by individuals to produce goods and services, to sell these goods and services in a market place and to reap some reward for this effort.” Functionally, we may define business as “those human activities which involve production or purchase of goods with the object of selling them at a profit margin”.
Business can be interpreted in various ways and they are as follows:
It refers to the state of being busy for an individual, group, organization or society.
It is also interpreted as one’s regular occupation or profession or economic activities.
It deals with a particular entity, company, organization, enterprise, firms or corporation.
It is also interpreted as a particular market segment sector like computer business and various other segments included under the term business.
It is wide and willing to use different activities
It consists of purchase, sale, manufacture, processing, marketing of products, services like manufacturing, trading, transportation, warehousing, banking and finance, insurance and advertising, etc.
There are various people and personalities who have defined business according to their perspectives. Some of them are discussed below.
According to Prof. R. N. Owens,
“Business is an enterprise engaged in the production and distribution of goods for sale in a market or rendering of services for a price”.
L.R. Dicksee states,
“Business is a form of activity pursued primarily with the object of earning profits for the benefit of those on whose behalf the activity is conducted”.
According to Urwick and Hunt,
“Business is any enterprise which makes, distributes or provides any article or service which other members of the community need and are willing to pay for.”
Haney defines it as,
“Human activity directed towards producing or acquiring wealth through buying and selling of goods”.
Peter F Drucker has drawn some conclusions about what a business is, what is useful from the business and how to understand the term business. His conclusions are listed below:
Business is created and managed by the people.
A group of people who will take decisions that will determine whether an organization is going to prosper or decline, whether it will survive or will eventually perish in the market.