1.1 What is a Business?
Definition
● A business is an organisation that combines human, physical, and financial resources to
produce goods and services that satisfy customer needs and wants.
● Businesses exist to create value (utility) and provide returns to owners/shareholders.
The Nature of Business
● Needs vs Wants
○ Needs: Basic requirements for survival (food, shelter, clothing).
○ Wants: Desires beyond basic needs (luxury items, entertainment).
● Goods vs Services
○ Goods: Tangible products (cars, phones).
○ Services: Intangible offerings (education, banking).
● Customers vs Consumers
○ Customers: Buy the product.
○ Consumers: Use the product (can be the same or different).
The Four Business Sectors
● Primary sector: Extraction of natural resources (farming, mining).
● Secondary sector: Manufacturing and processing (factories, construction).
● Tertiary sector: Provision of services (retail, transport, healthcare).
● Quaternary sector: Knowledge-based services (IT, R&D, consultancy).
● Note: As economies develop, they typically shift from primary → secondary → tertiary →
quaternary.
Entrepreneurship
● Entrepreneur: An individual who takes the financial risk of starting and managing a
business.
● Roles: Innovator, risk-taker, decision-maker, organiser of resources.
● Intrapreneur: An employee who acts like an entrepreneur within a large organisation
(innovates without personal financial risk).
Starting Up a Business
● Reasons for starting a business: Growth, earnings, transference/inheritance, challenge,
autonomy, security, hobbies/passions.
● Steps in starting up: Idea generation → Business plan → Financing → Legal
requirements → Marketing → Launch.
Definition
● A business is an organisation that combines human, physical, and financial resources to
produce goods and services that satisfy customer needs and wants.
● Businesses exist to create value (utility) and provide returns to owners/shareholders.
The Nature of Business
● Needs vs Wants
○ Needs: Basic requirements for survival (food, shelter, clothing).
○ Wants: Desires beyond basic needs (luxury items, entertainment).
● Goods vs Services
○ Goods: Tangible products (cars, phones).
○ Services: Intangible offerings (education, banking).
● Customers vs Consumers
○ Customers: Buy the product.
○ Consumers: Use the product (can be the same or different).
The Four Business Sectors
● Primary sector: Extraction of natural resources (farming, mining).
● Secondary sector: Manufacturing and processing (factories, construction).
● Tertiary sector: Provision of services (retail, transport, healthcare).
● Quaternary sector: Knowledge-based services (IT, R&D, consultancy).
● Note: As economies develop, they typically shift from primary → secondary → tertiary →
quaternary.
Entrepreneurship
● Entrepreneur: An individual who takes the financial risk of starting and managing a
business.
● Roles: Innovator, risk-taker, decision-maker, organiser of resources.
● Intrapreneur: An employee who acts like an entrepreneur within a large organisation
(innovates without personal financial risk).
Starting Up a Business
● Reasons for starting a business: Growth, earnings, transference/inheritance, challenge,
autonomy, security, hobbies/passions.
● Steps in starting up: Idea generation → Business plan → Financing → Legal
requirements → Marketing → Launch.
