Learn / 01 — What is a business?
What is a business?
A business is an organisation that provides goods or services to customers. Businesses use resources to create value and usually earn revenue by selling what they provide.
The basic idea is simple.
Meets a need or want
Businesses identify something that customers need or want.
Provides value
They provide a product or service that is useful to customers.
Has customers
Businesses need people or organisations willing to use or buy what they offer.
Manages money
Businesses receive revenue and have costs that need to be managed.
What can a business provide?
Product
Something physical that a customer can buy.
Service
An activity provided for a customer.
Some businesses provide both products and services.
See it in real life
Think about a local café.
- Need / want
- Customers want food, drinks or a place to meet.
- Product / service
- The café provides drinks, food and customer service.
- Customers
- People who visit or order from the café.
- Money
- Customers pay the café, while the café has costs such as ingredients, staff and rent.
Businesses come in different forms.
- Product-based
- Primarily sells products.
- Service-based
- Primarily provides services.
- Online
- Operates mainly through digital platforms.
- Social enterprise
- Uses business activity to pursue a social or environmental purpose.
Key takeaway
Businesses can operate in many different ways, but they all aim to provide value to a customer or user through what they offer.