Business is the activity performed by an individual or a group of people with a view to earning profit within the government rules and regulations. Some of the important characteristics of the business are given below:
Characteristics of business
1. Profit: This very important criterion of business that distinguishes it from other types of activities. People start a business just to earn profit although there are the possibilities of bosses at least in the initial stages.
2. Risk: Risk is inherent in businesses although the degree may vary from one kind to another. It is possible that there may be a loss instead of gain. There is no business activity, which is not subject to lose.
3. Legality: The subject matter of business is to be legal. Businesses can operate through government rules and regulations of a country. Illegal business is not to be considered as business.
4. Creation of utilities: Business leads to the creation of utilities and thus satisfies human wants by modification of product features, size, color, style, design, etc.
5. Exchange of goods and services: Exchange of goods and services is the foundation of the business. If there exists no exchange function there cannot be any business. The exchange function is the means to an end of maximizing profits.
6. Forecasting: Forecasting is indispensable for the growth and survival of a business. Some of the factors that a businessman must have to predict are:
- Demand and supply of the product
- Qualities of the product
- Existing and potential customers of product
- Observation of the competitor’s movement
- Technological changes
- Economic and political changes etc.
7. Rendering service to society: Rendering service to society is another important feature of the business. Businesses must have some responsibility towards society as well as the whole community. The responsibility of businessmen is the deliver goods and services in a way that is beneficial to society.
Other Content of Business: