Business Activity

Business Activity involves the process of converting raw materials into finished goods and selling at a profit.

Purpose of business activity:

• Ensures smooth production of goods and services
• Helps minimize cost of production
• Helps to improve efficiency

Stakeholders are people who are affected by the business, directly or indirectly.

Types of stakeholder:

Owner

Shareholders

Managers 

Staff

Customers 

Suppliers 

Society 

Government

Note: the first 4 are internal stakeholders and the latter 4 are external stakeholders.

Responsibility of the owner towards a business:

• They are responsible to invest capital, allocate resources and participate in decision making.
• In case the owners can not make decisions, they will hire external people who will be responsible to make decisions
• Their reward from the business is annual profir.