Introduction to Business Lecture Notes

Instructor Introduction

• Name: Matt Alanis
• Position: Business Instructor at Willow International Center
• Purpose: Recorded lectures for an online business course.

Course Structure

• Course Frequency: Three days a week.
• Material Coverage: Multiple chapters covered over 3-4 sessions.
• Format: Shorter sessions (approx. 30 minutes) to ease comprehension.

Chapter Overview

• Focus: Introduction to the concept of business in the US.
• Topics:
  • Fundamentals of business
  • Business environment and economy
  • Impact of external factors on businesses.

Key Definitions

Business

• Definition: An organization that provides goods and/or services to earn profit.
• Key Differentiator: Profit motive distinguishes businesses from non-profits.

Revenue and Expenses

• Revenue: Money received from selling goods/services.
  • Calculation: Number of goods sold/ services offered x Price per unit.
• Expenses: Costs incurred in operating a business (labor, overhead, marketing, etc.).
  • Example: Costs incurred by retailers to acquire products for resale.
• Profit: Difference between revenue and expenses; used for dividends, reinvestment, etc.

Importance of Profits

• Incentive for starting businesses.
• Reward for entrepreneurs' efforts and investments.
• Small businesses (under 500 employees) play a significant role in US hiring.

Consumer Choice and Demand

• Businesses must be in tune with consumer needs and interests.
• Importance of product demand in successful business operations.

Benefits of Business

1. Provision of Goods and Services: Meets consumer needs (food, clothing, durable goods).
2. Employment: Businesses provide job opportunities and income.
3. Innovation: Encourages development of new services/products, e.g., Apple’s product innovations.
4. Enhanced Income: Profitable businesses benefit owners and shareholders.
5. Support for Charities: Businesses often contribute to community and local charities.

External Environments of Business

• Definition: Factors outside a business's control that can affect operations.
• Importance: Adaptation to external environments is crucial for business survival.

Six Areas of External Environment

1. Domestic Business Environment

   • Definition: Business operations within the home country (e.g., Apple in the US).
   • Considerations: Customer preferences, supplier relationships, competition.

2. Global Business Environment

   • Importance: Impact of international trade agreements and conditions on local businesses.
   • Examples: US quotas on Japanese cars, political unrest affecting oil prices.

3. Political and Legal Environment

   • Relationship with local governments and compliance with laws.
   • Example: Google’s challenges in China regarding information control.

4. Technological Environment

   • Importance of adapting to technology (e.g., Amazon vs. Borders, Netflix vs. Blockbuster).

5. Socio-Cultural Environment

   • Understanding values and demographics to seize market opportunities (e.g., Hispanic population growth).

6. Economic Environment

   • Impact of economic conditions (e.g., unemployment rates, consumer confidence) on business operations.
   • Business strategies vary based on economic strength or weakness.

Conclusion

• Lecture Duration: Approximately 35 minutes.
• Next Session: Discussion of different economic systems.