TO INTRODUCTION BUSINESS MANAGEMENT
Chapter 1: What is business? I. Business and Entrepreneurship: revenues, Profits, and Losses a. Terms: a.i. Business; any activity that seeks to provide goods and services to others while operating at a profit a.ii. Profit: the amount of money a business earns above and beyond what it spends for salaries and other expenses a.iii. Entrepreneur: a person who risks time and money to start and manage a business b. Matching Risk with Profit b.i. Revenue: the total amount of money a business takes in during a given period b selling goods and services b.ii. Loss: when a business's expenses are more than its revenues b.iii. Risk: the change an entrepreneur takes of losing time and money on a business that may not prove profitable c. Businesses add to the standard of living and quality of life c.i. Standard of living: the amount of goods and services people can buy with the money they have c.i.1. US has one of the highest standards of living in the world c.ii. Quality of life c.ii.1. the general well-being of a society in terms of political freedom, a clean natural environment, education, health care, safety, free and time, everything else that leads to satisfaction and joy d. Responding to the Various Business Stakeholders d.i. Stakeholders: all the people who stand to gain or lose by the policies and activities of a business d.i.1. include: d.i.1.a. customers d.i.1.b. employees d.i.1.c. stockholders d.i.1.d. suppliers d.i.1.e. dealers d.i.1.f. bankers d.i.1.g. people in surrounding community d.i.1.h. environmentalists d.i.1.i. elected government leaders d.i.2. all affected by products, policies, practices of business
d.ii. current challenge: organizations to balance the needs of all stakeholdres d.iii. outsourcing d.iii.1. contracting with other companies to do some or all of the functions of a firm d.iii.2. may have serious consequences in states where many jobs have been lost to overseas competitors d.iv. insourcing: setting up design and production facilities here in the US d.iv.1. creates many new jobs & helps offset the number of jobs being outsourced e. Using Business Principles in Nonprofit Organizations e.i. Nonprofit organization: e.i.1. organization whose goals do not include making a personal profit for its owners or organizers