Enterprise - Business in Context

1 Nature of Business Activity

1.1 1.1 Nature of Business

Section
1.1 Nature of Business
1.2 Adding Value Concept
1.3 Opportunity Cost and Choice
Information
- Aims to satisfy needs by adding value to resources.
- Purpose: Use resources to meet customer needs through prod-
ucts or services.
- Factors of Production: Land, Labour, Capital, Enterprise, Con-
sumers, government, suppliers.
- Businesses create value by selling products at a higher price than
material costs.
- Added value is crucial for survival, covering other costs and
providing financial returns.
- Reducing Cost of Production: Lowering production costs en-
hances added value. Challenges: poor quality, Raising Prices.
- Practical Approaches to Add Value: Branding, Special Features,
Premium Services.
- Example - Jewellery Store: Attractive Packaging, Shop Display,
Customer Interaction.
- Economic problem: Limited resources, infinite needs, and wants.
- Choices and opportunity cost: Selecting the most beneficial op-
tions.
- SCARCITY → CHOICE → OPPORTUNITY COST

1.2 2. Dynamic Business Environment

Section
2.1 Dynamic Business Environment
2.1 Reasons for Success
2.2 Reasons for Business Failure
Information
- Risk in setting up new businesses due to constant changes.
- Challenges include new competitors, legal changes, economic
shifts, and technological advancements.
- Understanding customer needs, efficient operations management,
flexible decision-making, sufficient finance.
- Poor record-keeping, lack of cash flow, poor management skills.

1.3 3. Types of Businesses and Role in Economic Development

Section Information
3.1 Types of Businesses - Local: Small, specific area focus.
- National: Operations across a country.
- International: Selling in multiple countries.
3.2 Role in Economic - Employment creation, economic growth, business survival and growth,
Development innovation, exports, personal development, increased social cohesion.

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1.4 4. Entrepreneurs, Intrapreneurs, Qualities, Barriers, and Benefits

Section
4.1 Entrepreneurs and
Intrapreneurs
4.2 Qualities of Successful
Entrepreneurs or
Intrapreneurs
4.3 Barriers to
Entrepreneurship
Information
- Entrepreneurs start new ventures, take risks, invest capital.
- Intrapreneurs innovate within existing businesses, sharing risks and
rewards with the organization.
- Innovation, commitment, multi-skilled, leadership, self-confidence, risk-
taking.
- Lack of business opportunity, insufficient capital, cost of good locations,
competition, lack of customer base, business risk, uncertainty.
- Benefits of Intrapreneurship: Injecting Creativity and Innovation, De-
veloping New Business Approaches, Driving Innovation and Change,
Creating a Competitive Advantage, Encouraging Original Thinkers

1.5 5. Purpose and Key Elements of Business Plans, Benefits, and Limita-
tions

Section
5.1 Purpose and Key
Elements of Business
Plans
5.2 Benefits of Business
Plans
5.3 Limitations of
Business Plans
Information
- Executive summary, business opportunity description, marketing and
sales strategy, management team details, operations, financial forecasts.
- Essential for obtaining finance, provides a clear plan of action, forces
serious consideration of strengths and weaknesses.
- No guarantee of success, false sense of certainty, reliance on forecasts,
potential inflexibility.