MGT211

Introduction to Business
Lecture 01

DEFINITION
Any activity to earn profit.
The word business is

derived from the term

busyness.

Entrepreneurship
A phenomenon in which a person searches

for an opportunity and try to avail it.

Components of business
Industry
Commerce

Industry
Conversion of raw material into finished

goods.
This is a form utility.

Types of Industry
Primary Industry

Extractive Industry _ Extraction of

underground resources.
Genetics _ People doing business by
changing genes.

Types of industries
Secondary Industry

Construction _ Construction of buildings,

roads, bridges etc.
Manufacturing _ Conversion of raw material
into final goods.
Services _ Banking, consultancy, accountant,
Lawyer, Interior decorator, designer, music
composer etc.

Commerce
All those activities which start from the

warehouse of the manufacturer to the buyer.

Types of commerce
Trade

Trade means buying and selling

Aid to trade

Institutions that are meant and build to assist

and support the trading process.

Factors of production
Labor _ People working in an organization.
Capital _ Amount invested by investor in the

business.
Entrepreneurship _ Management ability of the
people who are running the business.
Physical Resources _ Land, labor, building,
vehicles, machinery etc.

Economic System
A system for allocation of resources.

Types of Economic Systems

Planned Economy
Free market Economy

Types of environmental forces

External Forces

Factors found outside an organization.

These factors are not controllable by the
organization.

Types of environmental forces

Internal Forces

Factors within the organization.

These are controllable by the organization.

SWOT Analysis
Strengths
Weaknesses
Opportunities
Threats