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THE NATURE AND AIMSTHE NATURE AND AIMS
OF BUSINESSOF BUSINESS
The Philippine EconomyThe Philippine Economy
The Role of BusinessThe Role of Business
Business DefinedBusiness Defined
Kinds of BusinessKinds of Business
Objectives of BusinessObjectives of Business
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The Philippine EconomyThe Philippine Economy
Low productivity in the workplaceLow productivity in the workplace
Graft and corruption in theGraft and corruption in the
governmentgovernment
The declining value of the pesoThe declining value of the peso
Unfavorable balance of tradeUnfavorable balance of trade
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Business successBusiness success
associated w/ Economicassociated w/ Economic
GrowthGrowth
Adequate capitalAdequate capital
-- prerequisite to the existence ofprerequisite to the existence of
business firmsbusiness firms
Availability of capitalAvailability of capital
-- ready to use; at handready to use; at hand
Proper Management of capitalProper Management of capital
-- key ingredient in the survival andkey ingredient in the survival and
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The Role of BusinessThe Role of Business
Business firms and governmentBusiness firms and government
are oriented towards theare oriented towards the
provisions of goods and servicesprovisions of goods and services
to the societyto the society
Ex.Ex.
- basic necessities- basic necessities
- services- services
- others- others
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Business DefinedBusiness Defined
Business is any lawful economicBusiness is any lawful economic
activity concerned with theactivity concerned with the
production and/or distribution ofproduction and/or distribution of
goods and services for profitgoods and services for profit
An entity is still a business if itsAn entity is still a business if its
objective is to make profitsobjective is to make profits
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Kinds of BusinessKinds of Business
Business may be classified in severalBusiness may be classified in several
ways. As to the nature of the principal activityways. As to the nature of the principal activity
performed, it consist of three main divisions:performed, it consist of three main divisions:
CommerceCommerce
IndustryIndustry
ServicesServices
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CommerceCommerce
Business firms which areBusiness firms which are
engaged in the buying andengaged in the buying and
selling of goods and services areselling of goods and services are
classified as those falling underclassified as those falling under
commerce:commerce:
- trading- trading
-merchandising-merchandising
- marketing- marketing
Examples: Super Markets, Sari-Examples: Super Markets, Sari-
Sari stores, Dry goods store,Sari stores, Dry goods store,
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Business
Commerce Industry Services
Marketing
GeneticTrading
Buy and Sell
Merchandising
Extractive Recreation
Personal
Finance
Construction
Manufacturing
others
Kinds Of Business
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IndustryIndustry
Industries are those mainlyIndustries are those mainly
concerned with productionconcerned with production
Goods produced are those whichGoods produced are those which
may be intended for ultimatemay be intended for ultimate
consumption which are calledconsumption which are called
Consumers goodsConsumers goods
And those which are intended forAnd those which are intended for
use of business and industry anduse of business and industry and
which are called Producer’swhich are called Producer’s
GoodsGoods
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Genetic IndustriesGenetic Industries
Business involved inBusiness involved in
- Agriculture,- Agriculture,
- Forestry,- Forestry,
- and Fish Culture- and Fish Culture
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Extractive IndustriesExtractive Industries
Businesses involved in theBusinesses involved in the
extraction of goods from naturalextraction of goods from natural
resources which includeresources which include
- Mining- Mining
- Lumbering- Lumbering
- Hunting- Hunting
- Fishing- Fishing
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IndustryIndustry
Can be classified into theCan be classified into the
following:following:
- Genetic IndustriesGenetic Industries
- Extractive IndustriesExtractive Industries
- Manufacturing IndustriesManufacturing Industries
- Construction IndusttriesConstruction Industtries
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Manufacturing IndustriesManufacturing Industries
Are those which convert rawAre those which convert raw
materials into finished products.materials into finished products.
Example:Example:
- Manufacture of drugs- Manufacture of drugs
- Plastics- Plastics
- Food- Food
- Liquor- Liquor
- Footwear- Footwear
- Motor Cars- Motor Cars
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Construction IndustriesConstruction Industries
Firms engaged in buildingFirms engaged in building
infrastructures like:infrastructures like:
- Airports- Airports
- Seaports- Seaports
- Dams- Dams
- Highways- Highways
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ServicesServices
A service business is one whichA service business is one which
sells services to buyerssells services to buyers
Service Firms may be classified:Service Firms may be classified:
- Recreation- Recreation
- Personal- Personal
- Finance- Finance
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RecreationRecreation
Examples:Examples:
- Movie houses- Movie houses
- Television- Television
- Radio stations- Radio stations
- Theaters for Drama and- Theaters for Drama and
stage presentationsstage presentations
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PersonalPersonal
Examples:Examples:
- Restaurants- Restaurants
- Barber shops- Barber shops
- Transportations- Transportations
- Hotels- Hotels
- Tailoring Shops- Tailoring Shops
- others- others
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ServicesServices
A service business is one whichA service business is one which
sells services to buyerssells services to buyers
Service Firms may be classified:Service Firms may be classified:
- Recreation- Recreation
- Personal- Personal
- Finance- Finance
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Objectives of the BusinessObjectives of the Business
A business is establishedA business is established
primarily for profitprimarily for profit
At times, short-term and long-At times, short-term and long-
term profits are sacrificed interm profits are sacrificed in
order to attain other goals suchorder to attain other goals such
as:as:
- Political Influence- Political Influence
- Family control of the Business- Family control of the Business
- Community Involvement- Community Involvement
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ObjectivesObjectives
To survive and grow, business firms must attain theTo survive and grow, business firms must attain the
following multiple objectives:following multiple objectives:
1. The provision of products and services to1. The provision of products and services to
thethe
communitycommunity
2. The satisfaction of personal objectives like:2. The satisfaction of personal objectives like:
- profits for owners- profits for owners
- adequate salaries and compensation- adequate salaries and compensation
- psychic income for all, including pride- psychic income for all, including pride
in work, security, recognition, andin work, security, recognition, and
acceptanceacceptance
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ObjectivesObjectives
To survive and grow, business firms must attain theTo survive and grow, business firms must attain the
following multiple objectives:following multiple objectives:
3. Protection and enhancement of the human3. Protection and enhancement of the human
and physical resources of societyand physical resources of society
4. Economy and effectiveness of operation4. Economy and effectiveness of operation
