Business Concepts Anna university mech 7th sem

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UNIT III

Production concept:

Management philosophy that buyers prefer goods and services which are cheap

and widely available.

Using different types of inputs to make an output is production. e.g. a firm production

wheat. thus production refers to the transformation of inputs or resources into outputs of

goods and securities ( education, medicine, banking, communication, transportation)

Inventory

Inventory is commonly used to describe the goods and materials that abusiness holds

for the ultimate purpose of resale (or repair)

The reasons for keeping stock

There are four basic reasons for keeping an inventory:

1. Time - The time lags present in the supply chain, from supplier to user at every

stage, requires that you maintain certain amounts of inventory to use in this lead

time. However, in practice, inventory is to be maintained for consumption during

'variations in lead time'. Lead time itself can be addressed by ordering that many

days in advance.

2. Uncertainty - Inventories are maintained as buffers to meet uncertainties in

demand, supply and movements of goods.

3. Economies of scale - Ideal condition of "one unit at a time at a place where a user

needs it, when he needs it" principle tends to incur lots of costs in terms of

logistics. So bulk buying, movement and storing brings in economies of scale,

thus inventory.

4. Appreciation in Value - In some situations, some stock gains the required value

when it is kept for some time to allow it reach the desired standard for

consumption, or for production. For example; beer in the brewing industry
http://www.businessdictionary.com/definition/management-philosophy.htmlhttp://www.businessdictionary.com/definition/buyer.htmlhttp://www.businessdictionary.com/definition/goods-and-services.htmlhttp://www.businessdictionary.com/definition/cheap.htmlhttp://en.wikipedia.org/wiki/Businesshttp://en.wikipedia.org/wiki/Lead_timehttp://en.wikipedia.org/wiki/Lead_timehttp://en.wikipedia.org/wiki/Economies_of_scalehttp://www.businessdictionary.com/definition/management-philosophy.htmlhttp://www.businessdictionary.com/definition/buyer.htmlhttp://www.businessdictionary.com/definition/goods-and-services.htmlhttp://www.businessdictionary.com/definition/cheap.htmlhttp://en.wikipedia.org/wiki/Businesshttp://en.wikipedia.org/wiki/Lead_timehttp://en.wikipedia.org/wiki/Lead_timehttp://en.wikipedia.org/wiki/Economies_of_scale


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Inventory examples

Raw materials - materials and components scheduled for use in making a product.

Work in process, WIP - materials and components that have begun their

transformation to finished goods.

Finished goods - goods ready for sale to customers

Marketing Concepts:

According to Philip Kotler, "Marketing is human activity directed at satisfying needs

and wants through exchange process."

Features of Marketing:

* Marketing is a regular and continuous activity

* Facilitates satisfaction of human wants

* Brings transfer of ownership

* Creates utility

* Importance of 4 Ps

Importance of Marketing:

Satisfies Human Wants

Provides profit and goodwill to marketing enterprises

Facilitates specialization and division of labour

Improves the standard of living of the society

Facilitates economic growth

Brings success in business

Marketing Mix
http://en.wikipedia.org/wiki/Raw_materialshttp://en.wikipedia.org/wiki/Work_in_processhttp://en.wikipedia.org/wiki/Finished_goodshttp://en.wikipedia.org/wiki/Raw_materialshttp://en.wikipedia.org/wiki/Work_in_processhttp://en.wikipedia.org/wiki/Finished_goods


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A Marketing mix is the mixture of controllable marketing variables that the firm

uses to pursue the sought level of sales in the target market."

Elements / Ingredients of Marketing Mix

Distribution channel

Thepath through which goods and servicestravelfrom the vendorto theconsumerorpayments for thoseproducts travel from the consumer to the vendor.

A marketing channel is a set of practices or activities necessary to transfer the ownership

of goods, and to move goods, from the point of production to the point of consumption

and, as such, which consists of all the institutions and all the marketing activities in the

marketing process.
http://www.businessdictionary.com/definition/path.htmlhttp://www.businessdictionary.com/definition/goods-and-services.htmlhttp://www.businessdictionary.com/definition/travel.htmlhttp://www.businessdictionary.com/definition/travel.htmlhttp://www.businessdictionary.com/definition/vendor.htmlhttp://www.businessdictionary.com/definition/consumer.htmlhttp://www.businessdictionary.com/definition/consumer.htmlhttp://www.businessdictionary.com/definition/consumer.htmlhttp://www.businessdictionary.com/definition/payment.htmlhttp://www.businessdictionary.com/definition/product.htmlhttps://www.boundless.com/marketing/definition/marketing-channel/http://www.businessdictionary.com/definition/path.htmlhttp://www.businessdictionary.com/definition/goods-and-services.htmlhttp://www.businessdictionary.com/definition/travel.htmlhttp://www.businessdictionary.com/definition/vendor.htmlhttp://www.businessdictionary.com/definition/consumer.htmlhttp://www.businessdictionary.com/definition/payment.htmlhttp://www.businessdictionary.com/definition/product.htmlhttps://www.boundless.com/marketing/definition/marketing-channel/


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A channel of distribution consists of two types of flows:-

Downward flow of goods from producers to consumers

Upward flow of cash payments for goods from consumers to producers

These channels of distribution are broadly divided into four types:- Producer-Customer

Producer-Retailer-Customer

Producer-Wholesaler-Retailer-Customer

Producer-Agent-Wholesaler-Retailer-Customer

Finance Concepts:

Assess business performance

Assessing your business performance should be an ongoing process. It helps you identify

areas that need to be improved before they become major issues, as well as giving you

the opportunity to consider how to respond.

The following methods can help you assess your business performance.

Review your business plan

SWOT analysis

A SWOT analysis is a management tool that can help you develop business strategies by:

building on strengths (S)

minimising weaknesses (W)

seizing opportunities (O)

counteracting threats (T)

Financial analysis

Key factors to consider in your financial analysis include:

trends in cash flow (positive or negative), revenue and expenses
http://www.business.qld.gov.au/business/running/making-and-managing-money/managing-cash-flow/analysing-cash-flow-statementhttp://www.business.qld.gov.au/business/running/making-and-managing-money/managing-cash-flow/analysing-cash-flow-statement


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current sales of various products or services

level and turnover of stock

review of debtor and creditor days

debt, and how your business services debt.

UNIT IV

Human resources is the set of individuals who make up the workforce of an

organization, business sector, oreconomy.

Working Culture:

Workplace culture is the type of environment people work in, the way they interact with

one another, the way they go about their work and the practices undertaken in this

environment. Some working culture are apparent at first glance while others are more

subtle and slow to reveal.

Importance of knowledge to a growing business:

The basic sources of knowledge available to your business

What is knowledge in a business?

Basic sources of knowledge

Exploiting your knowledge

Make knowledge central to your business

Sharing knowledge across your business

Create a knowledge strategy for your business Using information technology to gain and manage knowledge

Useful and important knowledge already exists in your business. It can be found in:

the experience of your employees

the designs and processes for your goods and services

your files ofdocuments (whether held digitally, on paper or both)
http://www.business.qld.gov.au/business/starting/supplier-stock-management/stock-control-basics/calculating-stock-turnoverhttp://en.wikipedia.org/wiki/Workforcehttp://en.wikipedia.org/wiki/Organizationhttp://en.wikipedia.org/wiki/Business_sectorhttp://en.wikipedia.org/wiki/Economyhttp://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#1http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#2http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#3http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#4http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#5http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#6http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#7http://www.business.qld.gov.au/business/starting/supplier-stock-management/stock-control-basics/calculating-stock-turnoverhttp://en.wikipedia.org/wiki/Workforcehttp://en.wikipedia.org/wiki/Organizationhttp://en.wikipedia.org/wiki/Business_sectorhttp://en.wikipedia.org/wiki/Economyhttp://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#1http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#2http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#3http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#4http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#5http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#6http://www.infoentrepreneurs.org/en/guides/importance-of-knowledge-to-a-growing-business/#7


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yourplans for future activities, such as ideas for new products or services

Basic sources of knowledge:

Customer knowledge

Employee and supplier relationships

Market knowledge

Knowledge of the business environment

Professional associations and trade bodies

Product research and development

Organisational memory

Recruitment(R)& Selection(S):

R-activity of establishing contact b/w employess & applicants

S-Pickin up more competent & suitable employee

R-It encourages large no of candidates for a job

S-Attempts at rejecting unsuitable candidates.

Types of Recruitment

1. Internal

2. External

Internal:


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Transfer

Promotion

Ex-employee

External:

Advertisement

Employment Exchange

Employment Agencies

Educational Institution

Recommendation

Labor contractors

Selection process:

Process of putting right men on a right job.

Procedure of matching organization requirements with the skills & qualification

of people.

Employee selection Process:

Preliminary Interview

Application Blanks

Written Tests

Employment Interview

Medical Examination


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Appointment order

UNIT V

Foreign trade:

International trade is the exchange of goods across nation trade is the exchange ofgoods across nation al boundaries.

Different modes of International Trade Payments:

In International trade methods of payment could take any of the following forms:

1. Cash in advance

2. Open account

3. Collection

4. Documentary credit

Type ofForeign Exchange Market:

There are three types of foreign exchange market existed in our country-

Spot Market- where exchange of one currency with another takes place on the spot.

Forward Market- where actual delivery of the currency will happen at a future date as

per agreement of present date.

0ption Market- Wherein a contract is made specifying the right to buy or sell astandard amount of foreign currency within a specific date at a certain price.

Usually three terms used in our foreign exchange market operation. There are-

Arbitrage- Spot purchase ofFC where the price is low and sells where the price

is high i.c. By low and sell high. Currency Arbitrage due to price difference in to

financial centers.

SWAP- Purchasing FC on the spot for selling Forward or selling spot for

purchasing forward Due to difference in interest rate of the concerned currencies.

Hedging- to avoid exchange risk, agreement is made to day to buy or sell FC to

be delivered at some future date at a rate agreed upon to day.
http://jakir13.hubpages.com/hub/Discousion-of-Documentary-creditLetter-of-credit-LCs-Operationhttp://jakir13.hubpages.com/hub/Concept-Of-Foreign-exchangehttp://jakir13.hubpages.com/hub/Discousion-of-Documentary-creditLetter-of-credit-LCs-Operationhttp://jakir13.hubpages.com/hub/Concept-Of-Foreign-exchange


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Imports and Exports:

"Imports" consist of transactions in goods and services (sales, barter, gifts or grants)

from non-residents to residents.

Exports Foreign demand for goods produced by home country.

Import is when you buy something from another country and get it shipped to you.

Export is when you sell something to another country and it then ship it

Besides the Foreign Trade (Development and Regulation) Act, there are some other laws

which control the export and import of goods. These include:-

Tea Act,1953 Coffee Act, 1942

The Rubber Act, 1947

The Marine Products Export Development Authority Act, 1972

The Enemy Property Act, 1968

The Export (Quality Control and Inspection) Act, 1963

The Tobacco Board Act, 1975

Globalization:

Globalization is the process of international integration arising from the interchange of

world views, products, ideas, and other aspects ofculture.

The worldwide movement toward economic,financial,trade, and communications

integration.

Globalization implies the opening of local and nationalistic perspectives to a broader

outlook of an interconnected and interdependent world with free transfer of capital,

goods, and services across national frontiers. However, it does not include unhindered

movement oflabor and, as suggested by some economists, may hurt smaller or fragile

economiesifapplied indiscriminately.
http://epp.eurostat.ec.europa.eu/statistics_explained/index.php/Resident_institutional_unithttp://business.gov.in/outerwin.php?id=http://dgftcom.nic.in/exim/2000/ftdract.htmhttp://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=195329http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=194207http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=194724http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=197213http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=196834http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=196322http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=197504http://en.wikipedia.org/wiki/World_viewhttp://en.wikipedia.org/wiki/Culturehttp://www.businessdictionary.com/definition/global.htmlhttp://www.businessdictionary.com/definition/financial.htmlhttp://www.businessdictionary.com/definition/financial.htmlhttp://www.businessdictionary.com/definition/trade.htmlhttp://www.businessdictionary.com/definition/trade.htmlhttp://www.businessdictionary.com/definition/communications.htmlhttp://www.businessdictionary.com/definition/communications.htmlhttp://www.businessdictionary.com/definition/integration.htmlhttp://www.businessdictionary.com/definition/perspective.htmlhttp://www.businessdictionary.com/definition/free.htmlhttp://www.businessdictionary.com/definition/transfer.htmlhttp://www.businessdictionary.com/definition/services.htmlhttp://www.businessdictionary.com/definition/labor.htmlhttp://www.businessdictionary.com/definition/labor.htmlhttp://www.businessdictionary.com/definition/labor.htmlhttp://www.businessdictionary.com/definition/economist.htmlhttp://www.businessdictionary.com/definition/economy.htmlhttp://www.businessdictionary.com/definition/economy.htmlhttp://www.businessdictionary.com/definition/apply.htmlhttp://epp.eurostat.ec.europa.eu/statistics_explained/index.php/Resident_institutional_unithttp://business.gov.in/outerwin.php?id=http://dgftcom.nic.in/exim/2000/ftdract.htmhttp://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=195329http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=194207http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=194724http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=197213http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=196834http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=196322http://business.gov.in/outerwin.php?id=http://indiacode.nic.in/rspaging.asp?tfnm=197504http://en.wikipedia.org/wiki/World_viewhttp://en.wikipedia.org/wiki/Culturehttp://www.businessdictionary.com/definition/global.htmlhttp://www.businessdictionary.com/definition/financial.htmlhttp://www.businessdictionary.com/definition/trade.htmlhttp://www.businessdictionary.com/definition/communications.htmlhttp://www.businessdictionary.com/definition/integration.htmlhttp://www.businessdictionary.com/definition/perspective.htmlhttp://www.businessdictionary.com/definition/free.htmlhttp://www.businessdictionary.com/definition/transfer.htmlhttp://www.businessdictionary.com/definition/services.htmlhttp://www.businessdictionary.com/definition/labor.htmlhttp://www.businessdictionary.com/definition/economist.htmlhttp://www.businessdictionary.com/definition/economy.htmlhttp://www.businessdictionary.com/definition/apply.html


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MNC and MNE:

A multinational corporation (MNC) or transnational corporation (TNC), also called

multinational enterprise (MNE), is a corporation or enterprise that manages production or

delivers services in more than one country. It can also be referred to as an internationalcorporation. These corporations must manage production establishments or delivers

services in at least two countries for them to be Trans or Multinational..

Business of Banking:

Money surplus units-----Money(banks)----Money Deficits units

Banking, accepting for the purpose of lending or investment of deposists of money from

public, repayable on demand

Functions:

Accepting Deposists

Giving loans

Overdraft

Safe custody services for gold

Insurance:

Social device providing financial compensation for the consequences

Purpose of Insurance:

Reduction in worries

Reimbursement of losses


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Opportunity for investment

Credit Enhancement

Opportunity for employment

Functions:

Providing protection

Encouragement of savings

Prevention of losses

Solution to social problem

Documents

Business Concepts Anna university mech 7th sem