Business Simplify

The concept of business is a big challenge to many today reason why is that is so diverse that it means different things to different people, depending on the background of the individual, and the perspective from which he or she is looking at it. Business as a concept cut across different activities of human endeavour, which makes it difficult to have a precise definition.
Very commonly the nature of activity of a person is engaged in tends to influence his concept of business. Thus, every economic activities or function tells us something about business or a “business” but none depicts the entire realm or scope of business, here business is seen to be related to one of these elements;

 Business as a means of creating goods and services for use of mankind,
 Business as a system of transaction (i.e. exchange of value)
 Business as a way of earning a living (i.e. generating income)
With these three elements we can say a business is a system created by an individual or group of individuals to earn a living through the creation and exchange of goods and services, which satisfy the needs, and desires of the society.
Peter Drucker in his own word defines business in this form “there is only one valid definition of business purpose – to create customer”. But no one creates a customer without having something of value to offer or sell. McNaughton sees business as the sum total of those activities that have as their main purpose the creation; maintenance and extension of a concern, which continues to exist because it earns profits or other benefits or money.
Essentially, a business enterprise is established to generate economic rewards (profit) for the owner through the production and distribution of goods and services, which have economic value. An item has economic value if it’s capable of satisfying the material needs of individual. Every business has an economic goal. The main reason and primary factor, which determines the survival of a business whatever its kind, is the achievement of the economic goal – profit. Profit here is the money left over after all cost have been paid here the cost element tells how much resources has been utilized, profit expectation is the primary force behind the business ownership and it is the prospect of earning profit that distinguish business organization from non-business organization.
The expectation of profit, however, may not be realized due to some factors. The uncertainty about profit realization i.e. the possibility of not realizing the expected profit, gives the risk element in business.
…End Notes
To establish a business enterprise, there must exist the need of particular commodities, and human and material resources must be readily available and capable of being effectively employed over some reasonable period of time. The task of the owners and managers of business organization is to determine what constitute the specific wants and needs of people and to organize the most convenient means of meeting those needs and wants at a profit