What is Business? Business is a systematic process of making, selling, and distributing goods or services for profit. Businesses usually deal with goods and services, both industrial and consumer. Consumer goods are goods intended for consumption and industrial goods are produced for production. Business activities also include services, such as electricity, water, finance, advertising, warehouse, transportation, and more. Some of these activities are separate from employment, but they are closely related. Let us discuss a few examples.
Earlier, the concept of business was producer-oriented. Today, business is largely consumer-oriented. That is, instead of producing what is desired, it is more about producing what people want. While business is a social endeavor, it still has definite downsides. One of the biggest downsides of business is uncertainty. Uncertainty can come in the form of changing consumer demands, government policy, or a combination of both. Lastly, business may experience trade cycles. According to Keynes, the trade cycle involves periods of good and bad trade, high unemployment, and declining prices.
As the name suggests, business has a profit motive. If there is no profit motive, the business activity is not truly a business. People engage in business for profit and wealth. By providing high-quality goods and services, businesses can make profits and satisfy consumers. Providing quality products and services at a reasonable price can help a business thrive. Businesses need customers in order to stay in business. The satisfaction of the consumers directly correlates to the profits and success of the business.