MEANING AND NATURE OF BUSINESS

The term business is differently perceived. Some see it as the means of purchasing and selling of goods and services.

Some individual see it as an economic phenomenon. Still, others defined it as an organization that makes profit. The economist is likely to strategies and exchange transaction that brings profit as a business.

However, in a more technical sense, business has been variously defined. In our perspective, business could be see as all legal profit – directed, economic and commercial activities that provide goods and services necessary to a country’s standard of living. (Boone and Kurts, 1976)

A critical examination of the above definition will focus on profit directed economic phenomenon, commercial activity, goods and services standard of living.

The major aim of any business is to ascertain profit though it may have varieties of purpose. A business enterprise is expected to be self – sustaining. It can only sustain itself, if it makes profit. Profit is excess of revenue over capital.

A business enterprise is not a charitable organization like an orphanage home, which survives on donation from philanthropist. For any person going into business venture, the main attraction and motivating force is profit making. Without the profit, the business will not meet its duty to its employees and will not survive let alone sky-rocket to its expectation. Again, a business enterprise takes on economic activity by creating and shearing of goods and services to satisfy human wants.