Characteristics of Business

Characteristics of Business Business, as an organization, is different for other social, religious or welfare organization. AS an organization, business possesses the following characteristics.

Social Institution: Business is a social institution. It is a recognized legal institution of the members of the society. It use social resources and work for the social.
Dealing items of the business: Business deals in goods and services. Its operation is in the materialistic area. By using different commodities or raw materials business manufactures different products.
Creation of utility: Major contribution of the business is creation of utility of value addition. Business creates utility for the society and this way it serves the society.
Going Concern: Business presupposes and regularity continuity and regularity of operations. In most cases business survives almost perpetually.
Dealing by consideration: Business is not a religious or charitable activity. In every transaction business requires consideration, business dealings for a price.
Profit as objective of business: profit is the prime motive of business. profit is the yardstick of survival of the business. It is index of efficiency and effectiveness. Only profitable business survives ultimately .
Administration in business: Business needs administration. proper administration or management ensures profitability, success or survivalist of business.
Gradual Growth of Business: Business survives or disappears. Successful business must grow and expand. Gradually business expend from a single proprietorship to Multinational company
Deliverer of standard of Living: Modern business is an influential in the social. It provides employment, income generation and consumable goods to the society. Thus business is the deliverer of standard of living in the society.
Business is inventor: Business tries to develop new products for the society. Business function include research and development. So business invents different uses of the natural resources and thus provides news goods to the society.

Nature of the Business

Nature of the business may be described as follows.

Profit making institution: The business activists are run to earn money or make profit. The chief adjective behind the business is profit maximization or wealth or value maximization.
Risk: Risk is associated with business operation. Every business action is risky. Without risk business impossible. So risk is one of the inherent business feature.
creation of utility: Business creates utility. All business activities are run with an objective of value addition or utility creation.
Materials in business: A businessman uses money, methods, men, machine, and materials in the business operation. The dealings are done in exchanging products and services for money and money for materials or other resources or inputs.
Enterprising: Business take initiation to materialize a program and convert raw material into finished product or one product into another.
Organization: Business is an organization. Business organizes men and machines to implement production plan.
Use of Capital or Financial Resources: Business utility capital which in the lifeblood of business. Money makes money; is a proverb that happens in business.
Monetary Value: Business activities have monetary value. Every activity is measurable in terms of money and non-monetary activities are usually kept outside business purview.
Regular Transactions: Business survives by regular transaction. The proof of existence of business is transactions. If transactions are stopped, business is liquidated. In accounting terminology this is termed as going concern situation.
Service Orientation: Business cannot survive by only profit making. The business will better survive by better service to customer. So there is general serving attitude among the businessmen.