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Types of Business Activities

Broadly, the business activities can be classified as follow:

1. Industry

Industry covers production aspect of goods. The term industry refers to the production aspect. The units engaged in producing the goods are collectively called as industry. The industry uses the raw material or semi finished goods for producing the finished goods. These goods can be industrial goods as well as consumer goods. The industrial goods are goods which are used in factories for manufacturing goods. An engineering unit manufactures the machine tools, it means the units is producing the industrial goods, because, such machines are further used for manufacturing the products. If a unit is producing butter, bread, cloth etc., it means the unit is manufacturing consumer goods, since these are consumed by consumers directly.

The industry creates the form utility in the goods. Thus, it produces the economic value. Industry requires both physical and mental efforts of human beings for creating economic values in the goods.

2. Commerce

Sale or exchange of goods and services is an essential characteristic of business. In the process of sale or exchange, goods pass through different stages till these are finally used or consumed by the customers, the last link in the chain from producer to customer. The process which fills the gap between producers and consumers is known as commerce. All activities which remove the gap between the producers and consumers  are known as commercial activities. It facilitates the distribution of goods and services among the consumers.

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Objective of Business Environment

Following are main objectives of business environment:
1. Knowledge of Information 
By studying the business environment, we can know the changes of business. This information is very useful for our business. Every businessman should aware current environment of business. With this, he can think the future of his business in such environment. 
2. Basis of Decisions 
One of main objective of the study of business environment that it can provide all the information which is needed for taking good decisions. Suppose, you completed your internal business environment study. With this study, you can take decision relating to purchase, sale, salary and price because you know your competitor, you know your suppliers and you know your customers. 
3. Helpful in making of Policies 
For making good business policies, we need to know and scan business through business environment. 
4. Technological Planning 
Today, technology is changing very fastly. 3 years ago, I have to search software for downloading …

Limitation of Business Environment Analysis

Following are main limitation of business environment analysis:

1. Unexpected and Unanticipated Events 

We can not tell unexpected and unanticipated events in business environment analysis. Sometime, business has to face unexpected happenings. So, there will no benefit of business environment in these cases.

2. No sufficient Guarantee

Business environment analyst does not give any guarantee whether all events will happen as per estimation in business environment.

3. Uncritical Faith 

Sometime data may be incorrect. So, decisions on basis of these analysis may be risky for business.

4. To much information

Sometime too much information relating to business environment analysis will create the doubt in businessmen.

Technological Environment

Definition of Technological Environment :-


“Technological Environment means the development in the field of technology which affects business by new inventions of productions and other improvements in techniques to perform the business
 work. "

Introduction to Business Environment

Business environment may be defined as the set of external and internal factors which affects the decisions of business. We can divide business environment into two parts

A. The Micro Environment of Business

These are powers which are deeply related with company and company can control these type of environment by improving its capacity and efficiency.

1. Suppliers

Suppliers are the persons who supply raw material to company.

2. Customers

Customers are the persons who buy goods from company.

3. Market Intermediaries

Market intermediaries are those person who helps company to sell its products.

4. Financial Intermediaries

Financial intermediaries are those institutions who provide loan, credit and advance to company.

5. Competitors

Competitors are those who also sell same product of company.

6. Public

Public is those group of people who can buy or who can show their interest to buy the products of company.

B. The Macro Environment of Business

Macro environment of business means all exte…