The Purpose Of Business - spider diagram

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  • THE PURPOSE OF BUSINESS
    • TYPES OF BUSINESS
      • Manufacturer
        • A business which takes raw materials and turns them into goods for sale. e.g coca cola
      • Retailer
        • A business which buys goods then sells them on to customers for profit. e.g shops
      • Social Enterprise
        • A business whose primary aim is to do good for the local, national and international community.
      • Distributor
        • A business who delivers goods to various customers via road, rail, sea and air
      • Service Provider
        • A business which makes money from providing a service for businesses and customers
    • WHY DO BUSINESSES EXIST
      • To share ideas
      • To educate people
      • Good for the economy
      • To help the envrironment
      • To make money
      • To make goods
      • To help people
    • GOODS, NEEDS, SERVICES AND WANTS
      • Durable goods
        • Goods that you buy and expect them to last a long time.
      • Consumable goods
        • Goods that you buy, use up quickly, then buy again.
      • Services
        • You usually pay for a service as you are using it. When you have finished using it then you will have no more or no less than  you originally started out with.
      • Needs
        • A need is essential. e.g water
      • Wants
        • A want is a luxury. e.g pillows
    • SECTORS OF INDUSTRY
      • Primary sector
        • Extracting, gathering or growing raw materials. e.g farming
      • Secondary sector
        • Turning raw materials into something
      • Tertiary sector
        • Provides a service. e.g hotels
    • FACTORS OF PRODUCTION
      • Capital (money)  - every business needs money invested into it
      • Land - the premises that the business is on
      • Labourers - workers
      • Enterprise (an idea) - someone needs to come up with the idea to start the business
    • WHY BE AN ENTREPRENEUR
      • Benefits
        • You can be your own boss
        • To pursue an interest
        • Independence
        • To earn more money
        • To take control
        • To help people
      • Drawbacks
        • You could lose money
        • It could take over you life
        • You have to work long hours
        • Stress
  • opportunity cost - The benefits that you have to give up in order to take a certain course of action.
  • Market - a place where buyers and sellers meet to exchange goods
  • Barter - when you exchange goods for the things you need
  • Gap in the market - when an entrepreneur comes up with a business idea that satisfies a need that is not currently being met.
  • entrepreneur - A person who has a business idea and shows enterprising skills in order to make it successful

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