+
Business Activity
+
Learning outcomes
■ Understand the purpose of business activity
■ Develop an understanding of needs and wants
■ Develop knowledge of the objectives of non-profit
making activity, private enterprise and public
enterprise
+
Starter
• List names of businesses
in the local area eg. Xcite
Electronics.
• You have 2 mins to name
as many as you can.
+
Businesses are all around us
What is a business?
What is a business?
Write your own definition on your whiteboard
+
What is a business?
“A business is ... an organisation that exists to
provide goods and services to consumers that
need or want them. Its main aim is to make a
profit”
+
Business Activity
■ What do businesses do?. .
+
The purpose of business activity
■ Businesses are set up to produce goods and services. These
goods and services are supplied to individuals and other
business organisations who need or want them.
■ There are many types of business organisation. Some are
major international businesses and others are smaller local
businesses.
Activity:
Come up with 3 major international businesses and 3 smaller businesses
that operate in Kuwait.
+
international businesses in Kuwait
+
Purpose of a business
A business exists to make goods, sell goods or provide a
service.
• What is the difference?
Purpose of a business
• Goods are tangible products (can be touched and held),
• A service is intangible products (you cannot touch them
or feel them in your hand) you leave the shop with
nothing!
+
Business Activity
■ Businesses produce goods and services. These are the products of
some businesses.
Which are goods and which are services?
Goods
Tangible items that are made, bought and sold
Services
Activities that other businesses or people do for you
+
Business Activity
+
Difference between Goods and Services
What is the Difference between goods and services?
+ •Goods are things you can touch ( Tangible
Products)
Services are things that other people do for you.
(Intangibles in Products)
+
Types of Goods and Services
■ Consumer and Producer Goods and services
+
Consumer and Producer Goods and
Services
+
Consumer and Producer Goods
+
Business in context
Kuwait Petroleum Corporation (KPC) is one of the world’s largest oil companies.
The company makes products such as petrol and diesel from crude oil. Crude oil is
oil in it’s raw or natural state. It occurs naturally in deposits within the earth. To
produce the petrol that people buy from garages, KPC must first extract the crude
oil from the earth. The company does this by drilling oil wells, many of which are
under the sea. KPC then transports the crude oil to oil refineries where it is turned
into petrol or other oil products customers want.
Individually answer the following questions:
1. What does KPC produce?
2. Does KPC produce goods or services?
3. Where can you buy KPC’s product?
4. What is KPC’s product made from?
5. Why do you think KPC produces petrol and diesel?
+
Business in context
1. KPC produces oil products such as petrol and diesel.
2. KPC produces goods (products).
3. KPC’s product can be purchased at garages and gas or petrol stations.
4. KPC’s product is made from raw or crude oil.
5. Student’s own answer. Points to consider could include:
■ KPC has the necessary raw materials in its country.
■ KPC has developed the skills to extract and produce petrol and diesel. This
means it could seek new locations to find oil.
■ There is a market for the product.
+
Learning outcomes
■ Develop an understanding of needs and wants
■ Develop knowledge of the objectives of non-profit
making activity, private enterprise and public
enterprise
+
Needs and wants
■ What is the difference between Needs and Wants
+
Needs and wants
■ What we need and what we want can sometimes be confusing.
■ Often you say you need a new iPod/mobile device when in fact you
want it rather than need it.
■ Which items do you think people need and which items do you think
people want?
+
Needs and Wants
+
Needs and wants
Needs
Clothing Shelter Food
+
Needs and wants
Wants
Expensive Car Mobile Phone Flat screen TV
Expensive Jeans Mansion Expensive Shoes
Party Dress
+
Activity 1.2
1. What is the main difference between needs and wants?
2. Make two lists: the first showing the things that you need; the
second listing things that you want.
3. Identify 3 kinds of businesses or organisations that supply each
item on your lists.
4. Select two businesses that you have identified and explain why you
think that they supply the item.
+
Activity 1.2 answers
1. Needs are items that we must have in order to live, whereas wants are
items that we would like to have but which are not essential for us to live.
2. Student’s own answer. Needs include items such as food, water, shelter
and clothing. Wants might include a certain style of clothing, a holiday, a
mobile phone and so on.
3. Student’s own answer based on items identified in question 2.
4. Students own answer based on businesses identified in question 3.
Reasons why the business supplies an item could be:
■ it wants to provide a service
■ it has spotted a market for the product to make money.
+
Different types of business
organisations and their purpose
+
Learning objectives
■ Develop knowledge of the objectives of non-profit
making activity, private enterprise and public
enterprise
+
Different types of business
organisations and their purpose
+
Types of business organisations
■private enterprise
■public enterprise
■non-profit making
+
Different types of business
organisations and their purpose
+
Private sector: private businesses and
enterprises
Private Sector: Business activity owned financed and controlled by private
individuals
+
Private sector
■ Self-employed traders
■ Professional firms
■ Small and large businesses
■ International companies
+
Different types of business
organisations and their purpose
+
Non-profit-making: a third type of
enterprise
Non-profit-making organisations include charities and voluntary
organisations.
These organisations are set up to fulfil a perceived social need or to
provide help to a specific section of the community.
+
Different types of business
organisations and their purpose
+
Public sector: businesses owned and
run by the government are public
enterprises
Public Sector: Business Activity owned, financed and controlled by the state
through government or local authorities
■ Government – key departments set policy and monitor implementation
■ Local Authorities – County Councils, District Councils
■ Schools
■ Hospitals
■ Libraries
■ Public Corporations – BBC
■ Transport
+ Case Study
+
Case Study Questions
+
Case Study Answers
■ CASE STUDY: JCB
■ 1 ▶ JCB makes producer goods. What is meant by the term producer
goods?
■ Products sold by one business to another are called producer goods.
JCB designs and manufactures a wide range of machinery for the
construction industry. These are producer goods because they are sold
to other businesses, not consumers.
■ 2 ▶ What is meant by the term private sector?
■ Business organisations owned by individuals or groups of individuals
operate in the private sector.
+
Summary
1. We all have needs and wants.
2. The main purpose of business activity is to supply the goods and services people want.
3. The objective of most private sector businesses is making a profit.
4. The main objective of public enterprise is to provide services to the local and national
community.
5. The main objective of non-profit-making organisations is to meet a perceived social
need or to provide help to a specific section of the community that is not met by
private or public enterprise
6. Businesses produce goods and services using scarce resources known as factors of
production: land, labour, capital, enterprise.
7. Value is added to the resources because of the work carried out to produce the finished
product has a value that increases the value of the parts and raw materials used.
+
Key terms
Goods- tangible products that can be touched and consumed
Needs – things necessary to sustain life
Private sector – the sector of business consisting of businesses owned by private
individuals or groups
Profit – the profit a business makes is the amount by which its income from
selling the goods and services it produces exceeds the costs of producing those
goods and services
Public sector – the sector of business consisting of businesses owned by the state
Services – things other people or businesses do for you
Wants – things chosen to satisfy a need or to make life more enjoyable
