Introduction to Business
Guess which company?
1907, two Seattle teenagers pooled their money and came up with $100
They started delivering messages and parcels by bicycle for local merchants
What company did they found?
Guess which company?
Parcel Service (UPS)
Founded in Seattle in 1907 by Jim Casey and Claude Ryan
Business and Entrepreneurship
= any organized activity that offers goods and services in a market
Entrepreneur = a person who risks money and time to start and operate a business
An entrepreneur accepts the risk and therefore deserves reward = profit
= the difference between revenues and costs for a business
= someone with a vested interest in the success of a business
Shareholder, employee, manager, customer, vendor Profit and Loss
revenues > costs, the business earns a profit
When revenues < costs, the business earns a loss
Profit is the motivation for all business activity
Risks and Rewards
= the chance that the entrepreneur will lose money, time or personal property
Entrepreneurs must be compensated for taking the risk = profit
How do entrepreneurs earn that reward?
Courage, creativity, capacity for hard work
Giving up other aspects of a “comfortable” life
take the entrepreneurial challenge?
Opportunity, independence, challenge, profit
kind of personal attributes are necessary for an entrepreneur?
Self-direction and self-discipline
Tolerant of uncertainty
Objectives of business
– increasing sales and market share
responsibility – to produce a good or service that has utility and quality
The environment confronting an entrepreneur When
an entrepreneur decides to start a business, he/she must consider:
is more to the decision than the product/service and the customer base
Economic and Legal Environments
of ownership and protection of private property
Contract and law enforcement
Economic infrastructure (eg. Tradable currency) Taxes and regulations
Minimization or elimination of corruption
to produce more goods/services with the same resource base
Productivity of workers and capital
Highly dependent on education
many competitors do you have?