The degree of scale of b aries dep. availability of resources. capacity to bear of the firm, competition in the market, and so on 12. Government Control: Business firms are subject to government control in the form of rules and regulations, Some of the Acts that business firms need to follow include: © The Companies Act, 2013 © The Competition Act, 2002 © Foreign Exchange Management Act, 1999 Environment (Pollution Control) Act, 1986. @ The Factories Act, 1948, and so on. Note: Students may explain about 7 to 8 points in one paragraph each for 7% marks. FUNCTIONS OF BUSINESS the smooth conduct of business activities, there is a need erform certain important functions. Generally, th ess functions are as follows: Finance Marketing Production Sales | ae | Corporate | Social Responsibility Manage Gore Human pe Public aes arch & Resource Manageme Relations lupmentnduction Function: Ina man facturing unit, production relates to conversion of w material into finished product, In the services sect ed as ‘operations juction function creates form utility. Within the prod: department, there are various sub-functions, which © Production planning and * Research and development Maintenance of plant and machinery nventory Management: ventory mai as finished goods, semi-finished and other items of inventory. gement refers to management of inventory su ods, raw materia per (inventory of materials must b entory and under inventory to be avoided maintained)‘ © Over inventory's to be avoided for it blocks working capita © Mader inventory blocks production cycle and consequently affects delivery of goods in the market. Inventory management involves the following activities: © Materials planning. © Purchasing of m. ials and other inputs. © Store keeping © Issuing of materials and other inputs © Monitoring inventory of ite Proper inventory of mat als and other inputs maintained. Over inventory d under inventory to be © Over inventory is to be av ed for blocking working capitUnder in entory blocks production cycle and con: ffects delivery of goods in the market 3. Marketing Function: The success and survival of the activities of the marketing department. Marketing is concerned with identification and satisfaction of customer requirements. s is largely influenced by Marketing involves several activities such as: a Marketing research which includes customer research dealer research, etc © Pricing of products by considering certain factors such as costs, competition, customers natures, conditions prevailing in the market, corporate image, etc 2 Promotion-mix which includes publicity, advertising, sales promotion, etc pC \e Product distribution which includes selection of channels of distribution, transportation, maintaining dealer relationship, etc ~e” Product positioning which aims at creating a distinct image of the product (brand) in the minds of target customers vis-a-vis competing brands. 4. Sales Function: In large firms, the sales activities are performed by the sales department{The sales department works in close coordination with the marketing department. The sales department is concerned with the selling activities of the firm)It receives or books orders from dealers or and then distributes the goods through the ustomers, distribution channels, The sales department may have to undertake up of sales, especially in the case of consumer industrial goods. follow durables or10 Commerce I (F.¥.B.Com.: SEM Finance Function Every business firm, large or small, requires adequate amount of funds for the efficient conduct of its activities. Finance considered as the life-line of modern business. Business finance is concerned with planning, obtain utilizing, and controlling of funds in a business. Some of t important finance functions are: ‘* Determining thé right sources of funds. ~~ Application of funds. 2 Proper ” Proper management of fixed capital, etc Human Resource Management (HRM): The success and survival of a firm largely depends upon the quality of peopl&\YRM is concerned with the management of people in the organisation. HRM activities include: Human resource planning, Recruitment and selection. Training of manpower. Performance appraisal Promotions and transfers. eee eee Compensation to Employees. Research and Development: Now-a-days, Jarge firms set up separate department to look after R&D activities. R&eD department plays an important role in product modifications and product innovation. Now-a-days\firms need to allocate a good amount of money for R&D activities. At present, in Indial the R&D expenditure is very negligible. Even large firms in India locate hardly 1 of their sales revenue towards R & D activities.Business Firms, especially from developed countries spend amount on R&D. For instance, in 2018, the leading R spender in the world is Amazon with over US $ 22 The top 10 R & D spenders in the w R & D Spend in 2018 Company Country US Billion 2 Alphabet _ USA i 3 Volkswagen | Germany 5 as) emmy feo = | 5 Intel USA 3 6 Microsoft USA 2 9 10 Source: Statista Public Relations: There is a need to maintain good public relations with the various sections of the public. Therefore, it makes a good sense to maintain separate department to look after public relations, especially in large firms. The public relations department may handle public queries, media queries or interviews, complaints from NGOs, customers and other agencies. It is the work of public relations department to manage corporate image of the firm a relations with various sections of the public dd to develop good Corporate Planning: Business firms und MNCs have pla take corporate planning function. Large separate department which looks after ‘orporate ing activities. The corporate planning activities includ10. . Analysis of internal and external environment © Setting of corporate objectives © Framing of corporate strategy © Assisting the managers in implementation of strateg: © Review of strategy performance. Corporate Social Responsibility (CSR): CSR is a management concept whereby companies integrate social and environmental concems in their business operations. CSR addresses the well-being of all stakeholders and not just the company’s shareholders. CSR is the commitment by business firms to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large. The Companies Act 2013 mandates companies with a net worth of more than 500 crore or revenue of more than ©1000 crore or net profit of more than €5 crore, to earmark at least 2% of their average net profits of the preceding three years for CSR activities. Firms undertake a series of activities to fulfill CSR obligations. The CSR activities include: © Donations to relief and rehab programmes. # Undertaking social awareness campaigns © Supporting educational initiatives © Training weaker sections of the society for se employment CSR can genera access to capi npetitive advantages, such as: Enhanced land markets, @ Increased sales and profits, © Ope ional cost savings,Business “Improved productivity and quality Efficient human resource network, Improved brand image and corporate reputation @ Enhanced customer loyalty © Better decision making and risk management processes, etc (Note : Students may write briefly one paragraph each on 7 to 8 points for 7% marks.) SCOPE OF BUSINESS The scope of business can be explained with the help of the various elements or areas of business. Business cari be broadly divided into two groups: Business is concerned with production and distribution of goods and services] The business activities are classified in two groups: Industry Industry is concerned with production of goods and services. The industry is concerned with processing and production of goods extraction of natural resources, reproduction of plants and animals,Commerce -I (F.Y.B.Com.: SEM-1 etc. The industry represents supply side |-e. supply of products to meet demand of customers. Types of Industries The various types of industries can be broadly divided into six categories: Primary Industries (These industries are engaged in the production of primary goods, such as rice, cotton, fish etc Agriculture and fishing are examples of primary industry Genetic Industries : (These industries are engaged in the reproduction and multiplication of certain species of plants and animals with the object of sale.\Cattle breeding, poultry and plant nurseries are examples Of genetic industry Extractive Industries (These industries are concerned with extracting materials or minerals from natural resources, Minin and oil drilling are examples of extractive industries. Manufacturing, Industries These industries are concerned with the production of finished goods.JThe finished goods can be either consumer goods or industrial goods) Textiles and chemicals are the examples, ed with brid Construction Industries : ‘Those industries ar construction ac vities like construction of buildin, etcBusiness 6/ Service Industry : Now-a-days, service sector is also referred as industry. \Service sector plays an important role in the economic development of a nation] Examples - ho tourism, transport, entertainment, informa on technolog: Commerce Itis a part of business, which is concerned with distribution of goods and services. Commerce can be broadly divided into two groups; Trade and Aids- to- Trade. COMMERCE = TRADE + AIDS-TO-TRADE The following chart indicates the classification of commerce COMMERCE AIDS-TO-TRADE | L Trade Trade refers to buying and selling of goods and services.It involves transfer_or exchange of goods and services for money or money's worth With the help of trade, the manufacturers can transfer the goods to final consumers.16 ‘ Types of Trade TN le can be divided into two groups © Internal Trade or Home Trade © External Trade or Foreign Trade (A) Internal Trade: Internal trade is also known as home trade. It is conducted within the country It can be at local level, regional level or national For instance, manufacturer of Mumbai selling goods to a retailer of Goa, is an example of home trade. Internal trade’can be further sub-divided into two groups (@) Wholesale Trade : It involves buying in large quantities producers and selling in smaller lots to retailers, The wholesaler is a link between manufacturers and retailers. @) Retail Trade : It involves buying in smaller lots from the wholesalers and selling in very small quantities to the consumers for personal use. "The retailer is the last link in the chain of distribution . The Fetailer acts as a link between the wholesaler and consumers. (B) External Trade: Moyfocl U7 Jit is also called as foreign trade. It refers to buying and selling of ' goods across national boundaries. For instance, a seller from New Delhi, (India) sells goods to a buyer at New York, (US.A.) is an ‘ample of foreign trade It can be divided into three types as follows (@) Export Trade ; It involves selling of goods from one country to another. For instance, when goods are sold from India to Pakistan, is an example of export trade. () Import Trade : \t involves buying of goods from a seller of another country. For instance, a buyer from India purchases goods from a seller of U.S.A. ()_Entrepot : When goods are imported from one country and then re-exported to some other country, it is called entrepot. ForBusiness instance, an Indian trader may buy then sell it to China. Il. Aids-To-Trade They are the activities, which (directly or indire exchange of goods and ser because the traders face some difficult Thus, the agencies or activities that facilitate smooth flow from the producer to the consumer are called 5. The need for aid in smooth con L—Warehousin; It removes time difficulty. Jn today’s world, pre undertaken in anticipation of demand. Goods are not consun immediately after production, Therefore, goods need to be stored in warehouses till they are demanded Some of the important advantages of warehousing are © It enables the supply of seasonal goods throughout the year. © It protects and preserves the goods from damage and spoilage. 2 Transport: It solves place difficulty. There is a place gap from the place of production to the place of consumption. Goods produced in ‘one corner of the country or globe may be required for consumption at the other part. Transport fills the place gap ‘Some of the important advantages of transport are © Itfacilitates distribution of goods. © Itenables marketers to expand markets. 3. Communication : It facilitates transfer of information) \t involve: messages from one person to another and from one place another. It can be oral or in writing. Oral communication ca transfer ofadvantages © “Tt facilitates quick transfer of message © Quick decisions can be taken. Insurance It minimizes the risks} Business is subject to risks, Cer be insured There are other risks, such as risks of e chan, orkers strike, etc., which « Risks such as loss due to fire, theft, etc. can be insured nsurance companies Some of the important advantages of insurance are © / It covers the loss on account of insurable risks © It enables firms to expand business. Banking: It solves problem of financ 4 to pay money for business transactions. The busir ks help businessmen to re also require short term and long term funds-)Banks pr uch funds to businessmen. Some of the important advantages of banking are «It facilitates receipts and payments. 9 It provides short term and long term funds. Advertising: It fills the knowledge gap, The good and consumed at several other places. Due toadvertising become aware of the products. Advertising can be done throu rious media, such as, radio, newspapers, ma outdoor, etcThe advantages of adve @ _Itcreates awareness of the produc “It builds a good brand image Salesmanship It facilitates pers nal selling, Sales force is r ‘Orders from dealers or custom Some of the important advantages of salesmanship ar @—The salesmen provide information to the buyers © They convince and pers t 8 Mercantile Agents The mercantile agents act as inte sellers. The agents remove personal ¢ Mercantile agents facilitate personal contact and the sellers. There are several types of mercantile a brokers, commission agents, auctioneers, etc Some of the advantages of mercantile agents are: The agent acts as a link between the buyer and seller. The seller can concentrate on production and marketing SIGNIFICANCE/IMPORTANCE OF BUSINESS c ‘Business plays an important role in any economy'JIt benefits severa sections of the society. It is significant not only to business and consumers, but also government and society as a whole The role of business shown in the chart n be broadly divided into three group:20 Commerce -1 (F.Y.B.Com.: SEM _ ROLE OF BUSINESS To Business Firms To Consumers To Society 8 Objectives © Quality Goods ‘8 Emplovment 18 Product Development 1 Good Prices © Social Welfare © Social Stars © Standard of Living. # Social Order. sv “L‘Significance to Business Firms Business plays an important role to business firms. The manufacturers, marketers, traders and even service providers derive benefits from business: 1c Achievement of Objectives: (Good business activities help a firm to achieve its objectives By producing quality goods and services that satisfy customers requirements, a firm can achieve its objectives such as: © Increase its sales. Increase in market share. Increase in profits. « Enharicement of corporate image. “Growth and expansion of business. 2 Corporate Image: Every{business firm makes efforts to develop a good corporate image. Good business practices such as R&D, effective after- sale-service, corporate social responsibility, etc., enable a firm to develop a good corporate image in the minds of various stakeholders such as customers, employees, dealers. shareholders, suppliers and others. J c20 Commerce -1 (F.Y.B.Com.: SEM _ ROLE OF BUSINESS To Business Firms To Consumers To Society 8 Objectives © Quality Goods ‘8 Emplovment 18 Product Development 1 Good Prices © Social Welfare © Social Stars © Standard of Living. # Social Order. sv “L‘Significance to Business Firms Business plays an important role to business firms. The manufacturers, marketers, traders and even service providers derive benefits from business: 1c Achievement of Objectives: (Good business activities help a firm to achieve its objectives By producing quality goods and services that satisfy customers requirements, a firm can achieve its objectives such as: © Increase its sales. Increase in market share. Increase in profits. « Enharicement of corporate image. “Growth and expansion of business. 2 Corporate Image: Every{business firm makes efforts to develop a good corporate image. Good business practices such as R&D, effective after- sale-service, corporate social responsibility, etc., enable a firm to develop a good corporate image in the minds of various stakeholders such as customers, employees, dealers. shareholders, suppliers and others. J cBus (For Reference) According to Brand Finance Survey, 2017 TCS is ranke in the world in IT services League for brand value. The 3 include 2017 Rank == Brand Brand Value (US $ Billion) 1BM 194 Accenture 175 Tcs 91 3.“ Customer Satisfaction: Sound business practices enable a firm to satisfy its customers. The business activities that generate customer satisfaction include: . © Timely and effective after-sale-service. “Improvement in quality of products. ~ Maintaining good customer relationships. @~ Effective sales-promotion activities, 4. Competitive Advantage: Good business practices enable a firm to gain competitive advantage in the market. For instance, innovation in products and services enable a firm to gain competitive edge in the market, Innovative firms can easily face competition in the market. For instance, firms like Volkswagen, Samsung, Roche, Intel, Microsoft are some of the world’s top spends on R&D and therefore, these companies come up with innovative products, which gives them competitive edge in the market. 5. / Efficiency of Business: Efficiency is the relation between returns to costs. A firm can be more efficient when it gets higher returns at lower costs.Certain business activities enable a firm efficiency, which includ © Research and deve ent . Expansion of Business: Sound business practices help a businessman to expand siness. So’ me of the strategies of business expansion include Market development - the firm enters in new mark © Product development - the firm introduces new © Market penetration - the firm increases its market shar n existing market through aggression promotion an product modifications. © _ Diversification of business. © Mergers and takeovers, and so on Economies of Scale: Good business practices such as effective after-sale-servic customer relationship management (CRM), product improvements, etc., enables a firm to increase demand for its goods and services. Increase in demand results in large scale production and distribution. Thus, the firm gets economies scale such as © — Economies of production such as discount on bulk purchas of materials, saving in labour costs due to installation labour saving devices, etc © Economies of distribution such as freight concessions pulk shipment : Optimum Utilisation of Resourc Sound business practices enab f resources. A firm would be ab ancial and human rese physical, fiBusiness ? position to generate demand for its goods and services up to its optimum production capacity. Therefore, a business firm needs to make every possible effort to improve its production and marketing activities 9 Research and Development: Business activities like marketing research, and product Fesearch and development enable a business firm to undertak product development, Through marketing research, a firm can identify customer requirements. The market research findings can be used by product research and development team to introduce new and innovative products. 10. Relationships with Society: Sound (business practices improve relations of a firm with various Séctions of the society. Business firms need to maintain ¢ excellent relations with the dealers, suppliers, customers, government authorities, media people, and the society in general. J To be competent in business, a firm needs to adopt sound business practices. This would enable a firm to build, maintain and enhance relations with various sections of the society 11. Social Status: Businessmen enjoy a better status in the socie! can act as a motivating factor to undertake sound business practices. Professional business-persons such as Ratan Tata, Narayan Murthy, Rahul Bajaj, Kumar Mangalam Birla and others command respect and reputation in the society. Their very presence motivates and influences members of the society to better their performance. The social stat (Note: Students may write about 8 points for a question on importance of business to business firms - 7% marks.) Il. Significance to Consumers Business plays a significant role in respect of consumers. The significance of business to consumers can be briefly stated as followAvailability of Quality Goods and Services: Business firms make availab ods and services required b the consumers, Firms make every possible effort to impro the quality of goods and services so as to have competi advantage in today’s business world. Goods at Good Prices: narke Firms provide goods and services at right prices. Today is a buyers’ market) There are fewer chances to exploit cust by charging higher prices. Firms try to deliver value for m Due to cut-throat competition, firms are for customer-oriented pricing strategies. Better Facilities and Services: Increasing competition in business has benefited the custome to a great extent. They are being offered better facilit services, such as after-sale-service, sale on instalment basis zero or low rate of interest, extended warranties, et professionalism in business makes business firms customer additional and better facilities at no or lo’ Customer Satisfaction: Gone are the days of profit orientation of business. Companie all over the world are placing emphasis on custom satisfaction/Some professional business firms go a step forws" to delight its customers by providing additional facilitie which may not be expected by the customers, so as to ret! existing customers, and to add new customers to their list Higher Standard of Living: Customers can enjoy a higher standard of living. This is beca™™ professional business firms make every possible effort * provide new and better products. The consumption of new ** better goods and services enhances standard of living of ® customers. Status to the Customers: Good business practices enhances brand image of the br" image. For instance, innovative brands enjoy a good imas* the market. Therefore, the users of the brand would enjoy 6”tatus in the market. For insta Lamborghini, Bugatti Veyr F i, ete., bring status te According, to Digital Trend n the world (2017) are 1. Sweptail by Rolls Royce (US$ 13 m g Trevita (US $ 4.8 million). eno Roadster (US $ 4.5 million) 3. Lamborghini V IIL. Significance to Society Business plays a significant role towards the society. The members of the society, government and nation as a whole derive benefits of business activities. The role of business towards society can be stated as follows: Economic Growth: Business activities facilitate economic growth in the country Economic growth relates to the increase in national income [National income increases when there is growth in various sectors of an econom| iculture, industry and services sector} I oducts Sound business activities help to promote industry's including agro-based ones. The service sector also gets a boos to good performance of industry and agricult du growth in all the sec results in economic growth of a nation 2. Employment: Business firms are responsible for direct and indirec employment direct employment in business firms increases on int of the growth of business firms. The growth o business results increase in demand for labour10, International Relations: Business helps to maintai er countries) This is because c enables countries to be dependent on ea helps to develop good rel Note to students: If a general question is asked on role of bu for 7% marks, you may briefly explain about 4 points each from first two groups. If the role of business to business firms is ask write about 7 to 8 points from the first group. TRADITIONAL AND MODERN CONCEPT OF BUSINESS TRADITIONAL CONCEPT MODERN CONCEPT 2 Meaning: It places emphasis on profits. It is | adopted by traditional business firms. balance betwee Itaims to achieve profits, customer satisfa societal interest. It is adop ‘ofessional business firms 2 Marketing Research: raditional business firms do not place emphasis on marketing research or customer feedback | Modern/ professional business firms give importance to market research to get feedback fro" customers and dealers. & Nature of Decision-making : The traditional managers make reactive decisions in response to competitors decisions. 4. Oppotunity Sensing : Traditional managers follow adhoc search for new opportunity The professional manag proactive decisions to etitive advantage Professional managers 3 ongoing search for new oturnities. 5. Orientation: It is producer of seller oriented concepl. It considers interest of only the sellers. tis acustomer and society opt. It considers i customers and societyBusiness 6. Pricing Methods: Under this concept, firms follow cost oriented methods of pricing, such as Cost Plus Method, this concept, firms place nited emphasis on promotion- | salesmanship, et ‘ &. Quality of Products: ting firms hardly place emphasis on R&D to improve quality and to develop LorResearch and Development is concept hi cdly places [emphasis on R & D. 16. Social Responsibility This concept does not give importance to social responsibility of business. 11. Time Frame: The marketing managers consider short term time frame. Day-to-day financial year. 4X Area Coverage: Traditional business firms cater mostly to the local market. 13. Assumption: It assumes that consumers will favour or buy only those products that are widely available and are Jow iin cost. decisions have relevance in a given| market oriented method such as Going Rate Me — Dt | products This concept give consider long term time frame. Moder/protessional business firms operate over a large market even at global level It assumes that business will survive and prosper only when a firm enhances customers’ and society's well-being The strategic marketing managers The decisions are taken consideringDISTINGUISH BETWEEN ECONOMIC AND SOCIAL OBJECTIVES 1. Meaning Ecc economic or financial aspects of the firm. ic objectives relate to the The purpose is to bring higher returns to the firm such as higher ket s 3. Examples Profit maximisation, product innovations, etc. are the examples nomic objectives ECONOMIC OBJECTIVES 2. Main Purpose SOCIAL OBJECTIVES Social objectives relate bilities of business towa various stakeh« The purpose is to fulf responsibility of the earning goodwill Supply of quality goods, pa of good wages, etc. are the ex of social objectives. 4. Expansion of Business Mi objectives may nx y achievi lead to 5. Primary / Secondary They are the primary objectives of a business unit because eco- nomic objectives ensure survival 6. Pervasiveness They are universally accepted and 7. Scope The scope is narrow. These objectives are achieved only 8. Support from Public y not support those t concentrate only on economic objectives. Achis develops corporate ima, expansion of the business to expansion of business. They are the secondary objectives of a business unit. Some survive without achieving social and growth. objectives. They are adopted especially by followed by all business firms. large professional business firms The scope is wide. They are achieved by business and non- Public strongly supports those firm that undertake social objectivesBusiness 2. Origin: | 10. Owners /Society Interest Economic ot tives such as profits] Social objectives such as dor satisfy the interest of owners upport the interests of sex U. Quantitative/Qualitative: — The economic objectives.can be | They can be expressed expressed in quantitative terms | qualitative term as sup such as increase in profits. of quality goo NEW TRENDS IN BUSINESS - PART Ill IMPACT OF LIBERALISATION Liberalisation mean reduction of Government controls on t private sector] With the announcement of Industrial Policy 199 the private sector is given more freedom from Government cont The impact of liberalisation is explained as follows: I. Positive Impact: 1. Abolition of Phased Manufacturing Programme: The Government has withdrawn Phased Manufacturing Programme. Now there is no need to use domestic content or materials. 100% imported raw materials can be used. This means, the quality of goods may improve due to import of good quality materials and parts 2 Liberalisation of Industrial Location: The Indian companies are given freedom to locate industries anywhere in the country. Only the 6 industries that require licence and the polly Government authorit industries require clearance from to locate the units. This means, mostmnmerce - 1 (F.Y.B. Indian firms can select the right location as per without Government clearance and interference 3. Broad Ban The Industrial if, of Industries: slicy 1991 Related or similar products industry to adjust ps lowed broad bandin, n be grouped under one t mix. For instance, products like cars, tempos, trucks can be gr under one industry to adjust product mix. This means, f can adjust product-mix depending upon market dem. without Government approval 4. Competition Act, 2002: The Government has introduced Competition Act, 2002. It aims at promoting competition rather than interfering in the work of large companies. Anti-competitive practices are restric under this Act. 5. Delicensing: The Industrial Policy 1991 delicensed industries except six Delicensing enabled Indian companies to concentrate on productive activities rather than wasting their time, money and effort on unproductive licensing formalities. Il. Negative Impact: 1. Problem of Phased Manufacturing Programme: The abolition of phased manufacturing programme would affect Indian companies producing raw materials and parts This is because; several manufacturing firms may pre als from abroad rather, than obtaining, 2 blem of Liberalisa of Industrial Location: give in the country as Id Government h freedom to locate indus Per the choice of the busine Micct the development of backward a: rialists May Not be inclined to set up the areas due to lack of infr3. Problem of Broad Banding of Industries Due to broad banding of industries, th wire nein tate ithe jobs, or they may be lay-off, especially tha mporar workers. This is because; the compan production of low demand products. Howeve rease production of high demand products, and as orker may be transferred to high production area 4. Problem of Delicensing: The Industrial Policy 1991 recommended automatic expansion without Government permission. This has resulted in heav expansion of capacities in the 1990s in all sectors of the industry This in turn has resulted in recession, especially between 1996- 2003. y IMPACT OF PRIVATIZATION Privatisation involves dereservation and disinvestment of public sector. The impact of privatization is as follows: Positive Impact: Benefits of Dereservation: The Government has dereserved public sector. At present, there are only three industries reserved for public sector. Dereservation has enabled the entry of private sector in those industries, which were earlier reserved for public sector. This has generated competition between the private and public sector, which in turn has improved customer service, a efficiency of business firms. id units, especially non-strategic of Government shareholdin ties, in public sector units » private fCommerce - 1 (F.Y.B.C Disinvestment aims at the following objectives. ¢ Improvement in customer service. © Improvement in the performance of units. © — Overcoming the political interference. © — Overcoming corruption and inefficiency, etc IL. Negative Impact: 1 Problem of Dereservation: The Government has derese the public sector. This has allowed the entry of private sect in those areas which were earlier reserved for Public sect The entry of private sector has resulted in over expansion production capacities, which resulted in recession, especial from 1996 to 2003. Problem of Disinvestment: The Government started the Process of disinvestment since 1991. The disinvestment has lei to: 4 _ Exploitation of workers through reduction of work-fore 4 “ey, Exploitation of customers by charging high prices IMPACT OF GLOBALISATION ————— Globalisation involves interlinking of domestic economy with th world economy. It involves reduction or withdrawal of custo® duties, reduction of quotas, less restriction on remittances abrom! and so on. The impact of globalisation is stated as follows: L Positive Impact: Reduction of Custom Duties: The custom duties on impor have been reduced considerably, especially, since 1995 (wi . the setting up of World Trade Organisation). In 1995, the peNote: Students may writ answer. No need to group the point TURNAROUND STRATEGY Turnaround refers to transformation of a loss-making profitable one. Some of the firms suffer from For instance, Tata Teleservices suf t los: z4. 2012-13, and for the year 2 Therefore, Tata Teleservices ¥ bring the company back on the tracks. Turnaround is possible only business operations. Turnaroun itcan include divestment strate; or get out of certain business and sells o Normally, the turnaround strategy aims at im sales or market share and profits. The dec may be due to several factors both int ‘Some of these factors may include high cost of utilization for the goods and s* Tecession, managerial inefficiency Essent ern Turaround to be successful, the followed by the management or tur? 1 There must Communication: ent ‘tion. Any information £ throughout the o ni tumaround strates must be quick, clear and coan import effectiy Availability of Resources: Ther re 1 e top manag: urnarou ing in mind its impact term prospects of the 5. Review of the Situation: The turnaround team needs t @ proper review of both the internal and external s cting the firm. The turnaround team should review Government policies that affect the firm © Competitor's strategies. © Customers’ response to the firm's products. © Market position of the firm - market share, sales. Machinery and technology used by the firm zement-labour rela ns, etc such a review will help the tur round experts t nd threats (SW x . weaknesses, opportunitic ym Various Parties: To make turpasiness employees, suppliers, shareholders, de uithorities, Fis, etc. For instance, support employees to implement the va turnaround purpose. 7, Viability of Business: Turnaro: when there is viability of business. One cannot revive ab which has no prospects. It is better to close down a bu when there are no prospects nd strategy can work For instance, Encyclopaedia Britannica announced in May 2 the closure of 32 printed volumes after 244 years of exister The main reason is that the demand for the Encyclopaed dwindled due to the popularity of internet. & Planning and Control: There must be proper planning an control of various operations. A firm implementing turnaround strategy needs to analyse both internal and externa environments and then plan accordingly. Apart from plane there must be effective control of various activities - both financial and non-financial Steps in Turnaround Strategy + To manage turnaround strategy, and to make it successful, the following are the steps that may be followed by business firms: Turnaround Committee L Causes of Losses 1 Investigation L Alternative Solutions 4 Selection of Best Solution 4 Implementation and Reviewpasiness employees, suppliers, shareholders, de uithorities, Fis, etc. For instance, support employees to implement the va turnaround purpose. 7, Viability of Business: Turnaro: when there is viability of business. One cannot revive ab which has no prospects. It is better to close down a bu when there are no prospects nd strategy can work For instance, Encyclopaedia Britannica announced in May 2 the closure of 32 printed volumes after 244 years of exister The main reason is that the demand for the Encyclopaed dwindled due to the popularity of internet. & Planning and Control: There must be proper planning an control of various operations. A firm implementing turnaround strategy needs to analyse both internal and externa environments and then plan accordingly. Apart from plane there must be effective control of various activities - both financial and non-financial Steps in Turnaround Strategy + To manage turnaround strategy, and to make it successful, the following are the steps that may be followed by business firms: Turnaround Committee L Causes of Losses 1 Investigation L Alternative Solutions 4 Selection of Best Solution 4 Implementation and Review« ree 1 (0Y.B.Com.: SEM. Turnaround Committee: The business fir set up a tumaround committee or a team to de turnaround strat The committee may in anagement | nnel, consultant, and may includ: employees’ re tive, At times, business firms app: w CEO to deal with turnaround strategy. The CEO may t the help of se nt personnel to mana; turn. turnaround team ha: tify the possible causes of losses. The losses may be due internal factors or external factors or both. The internal causes may be: © Entry ina new non-viable business. © Excessive manpower © — Focuson several product lines or brands. © Use of outdated technology. Growing customer complaints, etc The external causes may be: © Changes in government poli © Competitors’ strategies. © "Changes in customer preferences. © Technological changes. @ Prolonged recession in the market 3. Investigation of Causes: The turmaround te us tailed analysis of the various causes, The tur take the following, activities: m needs tocond around te ad may und » needs to discuss with workers to know the ° The probl ems and to support ed to know the e Consumer research may be conduc reactions towards company’s products ad serviBusiness 4 @ Dealers’ survey may be conduc ted t on the company’s police relating to dealer ince complaints from customers, competitors’ strate o Alternative Solutions: The team must look for alternati solutions to overcome the problem alternative solutions may be of poor performance. The @ Downsizing of workforce —Debt-equity swap to reduce interest burden. e@ Divestment of unviable or non-core business unit. © Focusing on profitable customers, etc Analysis of Alternatives: The turnaround committee must analyse the various alternatives. There must be analysis of benefits and costs of every alternative solution or strates © The benefits to be analysed in terms of returns or performance. © The costs to be analysed in terms of money, manpower, ete, The analysis of benefits and costs must be undertaken not only from short term perspective but also from long term point of view. Selection of Best Alternatives: The team may select a proper mix of alternatives. The team may select two or three alternatives out of the several listed. The choice of the best alternatives depends upon the causes of poor performance and the current situation. The management must also consider the viability of the alternative, the availability of funds, sup from employees, etc port Communication of Turnaround Strategy : The #4" San must commun the t und strategy hg: shareholders and other concerned sta! communication will receive support fr implem of the turnaround stra kders. eholders for‘ Commerce LEY NA 8. Allocation of Resources: The compar to organise the resou xquired to implement the se Y. In case of divestment, the firm will get the resources from th of the unit or product line. fr cases, the com to negotiate with financial instity for funds required for implementation, The shareh« also contribute by way of r share 9. Implementation: The co the employees, shareholders and financial institutions t the turnaround strategy successful. There must be a cont dialogue between the turnaround team and the emple firm also needs to hold talks with the fin other investors. pany needs to get good support fr 10. Review: The turnaround strategy needs to be m different phases. Monitoring of implementation is a must ensure early revival. If required, the company may additional measures to overcome the turnaround strategy nitored REVIEW QUESTIONS Essay Type Questions: (7 to 8 Marks) 1. _ Discuss the meaning and features of business 2. Explain the main functions of business. 3. Describe the scope of business. 4. Explain the significance or importance of business. 5. _ Distinguish between traditional and modern concept of business 6. Discuss the steps involved in setting business objectives 7. Bring out the classification of business objectives 8. How would you reconcile economic objectives with social objecti"® 9. Describe the impact of liberalisation on business and the econo 10. Bring out the impact of privatisation on the business and the «o™ 11. Discuss the impact of globalisation on the business and the econ 12. Explain in brief strategy alternative with reference to growth strat 13. Explain the stability strategy as a strategy alternative. Discuss in brief the retrenchment strategies. 14. wy Strategies. 5 Explain restructur 15. Explain 47 Explain the steps in turnaround strate What is turnaround 16.Sra eed Pe kL Commerce -I(EY.B.Com.: Spy INTRODUCTION - PART! eC CONCEPT OF BUSINESS ENVIRONMENT ——— ee Business environment consists of all the internal and external for, ‘r factors that influence the working of a business firm. The intémal factors comprises of firm’s stral management- labour relations, resources like m machines, etc The external environment comprises of the micro factors si competitors, suppliers, etc., and the macro fac social, political, technical and other factors. Analysis of the internal environment helps a firm to identify i strengths and weaknesses, and the analysis of external environmes helps to identify opportunities and threats. Thus, environme analysis helps to undertake the SWOT strengths, weaknesse $ and threats) analysis. Nowadays, SWOT is referte SE 5WOC (Caiands for Challenges). Definitions surround and affect it.” Inthe words of J. Kriz and C. Duggan, “Business environmet consists of all external and internal [factors that influence th complex interaction of the market, production and finance, th three basic components of our business world.” Features of Business Environment ——— ment The following are the main characteristics of business environm* 41. Dynamic in Nature: Business environment is dynamic # a Tee) VES eee PRAKASHAN NOTES | MODULE:2 BUSINESS ENV... Cec? ] @ eat ae ny fe Ce) Next: FYBCOM SEMI | COMMERCE MANAN PRAKASHA. a) Reel sea 78450001 I) aCommerce -1(F.Y.B.Com INTRODUCTION - PART! ee CONCEPT OF BUSINESS ENVIRONMENT Business environment consists of all the internal and external for, ‘r factors that influence the working of a business firm. The intémnal factors comprises of firm’s strategies and polic management- labour relations, resources like manpower, machines, etc The external environment comprises of the micro factors customers, competitors, suppliers, etc, and the macro factors so as economic, social, political, technical and other factors. Analysis of the internal environment helps a firm to identi strengths and weaknesses, and the analysis of external environmen helps to identify opportunities and threats. Thus, environments analysis helps to undertake the SWOT strengths, weakness tunities and threats) analysis. Nowadays, SWOT is referte aoWor (Cstands for Challenges) Definitions 1. According to Keith Davis, “Environment of the business mess the aggregate of all conditions, events and influences thet surround and affect it.” In the words of J. Kriz and C. Duggan, “Business environmet consists of all external and internal factors that influence tht complex interaction of the market, production and finance, t™ ‘basic components of our business world,” Features of Business Environment ———snainess Environment The following are the main characteristics, of business environme™ 1. Dynamic in Nature: Business environmen . n dynamic i mature. Changes take place in the external environmentCommerce -1(F.¥.B.Com.: Sty “ IMPORTANCE OF BUSINESS ENVIRONMEN, Environment analysis enables a business firm to identify strengths, weaknesses, opportunities and threats. Environm influences must be identified and analyzed individually » collectively to determine their real and potential effects on organisation. An organisation is a part of a complex world; it dem not exist in isolation, and therefore, it needs to scan the environmen in which it operates. Proper environment analysis helps a firm formulate effective strategies in the various functional areas. Ty importance or role of scanning business environment is briefly stat: as follows: 1. Identification of Strengths: The analysis of the interne environment helps to identify the strengths of the firm. Ever organisation must strive to maintain and improve on strengths. The following instances indicate the strength of a business fre Competent and dedicated employees. Effective personnel policies (selection, training, promot etc.), which are employees-cum-or Technology used by firm leads to lower cost of product Working conditions and welfare facilities, which gener job satisfaction. Identification of Weaknesses: The analysis of the inter environment indicates not only strengths but also weaknes? of the firm. The firm needs to identify its weaknesses and con® them as early as possible. For instance, the machines used may be outdated, and there they must be replaced with new ones. Also, employees ™ = pa Soe dedication; the firm may provide train®} Identification of Opportunities: An analysi: lysis of the exter environment helps to identify the opportunities in the maTps Bo sess Encéromment - The business firm should make every possible effort to grab the opportunities, as and when they come. Failure to do so would mean that someone else would grab the opportunities. For instance, the government may reduce excise duties on certain items. Business firms may use opportunity to reduce prices, which may generate higher sales Identification of Threats: Business may be subject to threats from competitors and others. Therefore, environmental analysis helps to identify threats from the environment. Identification of threats at the earliest is beneficial to the firm, as it helps to defuse the same. For instance, a competitor may come up with innovative product. This may adversely affect the firm’s business. Therefore, the business firm should take immediate steps to introduce a new product or to enter into a new market. Planning: A proper study of environment helps a business firm to plan its activities properly. Before planning, it is necessary to analyse the internal as well as external environment. After SWOT analysis, the firm lists out specific organisational objectives. Based on the objectives, the firm frames plans in all functional areas to achieve the objectives. Organizing Resources: Proper analysis of environment enables 4 firm to set the objectives or targets. Depending upon the je the firm lists out the various activities to achieve the objectives. To undertake activities, the firm makes proper ‘arrangement of resources such as: * Physical resources. * Capital resources * Manpower - managers and non-managers. ‘ating Employees: Environmental analysis enables a firm ° Bive right directions and guidance to its employees. Proper itections facilitate improvement in efficiency and productivity, 'e, the performance of the firm improves. Therefore, employeesare rewarded with higher monetary and non-monet,. incentives. Controlling: There is constant and continuous need to scans environment. Timely scanning of the environment ena firm to take corrective measures. For instance, environmental scanning may indicate change competitor's strategies. Therefore, the firm must take immedi. steps to correct or modify its strategies in order to counter moves of the competitor Survival and Growth: Environmental analysis is necessary (a) Locate the areas of strengths and weaknesses of the fim (b) Identify factors that provide opportunities and pose thres for the company’s survival and growth. The SWOT analysis helps the firm to improve its strengtis overcome its weaknesses, grab opportunities, and defuse te threats. Thus the firm would be in a better position to surcin and grow in the competitive business world. Corporate Image: Due to environmental analysis, the ovedl performance of the organisation improves. Therefore, the imap of the firm improves in the minds of various parties, it customers, dealers, suppliers, etc. . Innovation: Environment analysis makes business fire Proactive, Miey come up with innovative ideas to gi competitive advantage in the market. For instance, professio® business firms come up with innovative products and sches® to face competition in the market. face competition in the market, busi®™ efficient. Therefore, business fi ‘arious activities such as: © Training and development @ Research and developmentvapor * Technology upgradation, etc reabove activities enable the firm to ach 0 achieve jechigher returns at lower costs. igher efficiency, pesindents may write 8 points for 7% marks ssieess and environment are interdependent on each for Sainable growth. The interrelationship between busines ao seironment is explained as follows: Basiness and Natural Environment: Business firms depend on natural environment for the supply resources like raw materials, water, etc. However, the Owing use of natural resources by business firms has resulted Bidepetion of natural resources. Industries are also responsible fall types of pollution. Considering the importance of natural business firms should take measures to conservs Mther than to overexploit the natural resources. The benefits from business, Due to ‘Matura| ironment Seclopments in the Meld of technology; there is availability 4 energy. ,. Business firms have also come innovations that can substitute natural resources oFEnesronment EDUCATIONAL ENVIRONMENT ee primary Education a Maharashtra, primary education covers schooling upto 4th standard,"(The Central Government lgvcwe n considers prir education from Ist to 5th standard and upper primaer« from 6th to 8th standard) ae The government has taken several steps to spread primary education. The National Policy on Education had stated thet children attaining 14 years would have free and compulsory education up to class V {The Right to Education Act aims at providing free and compulsory education to children from 6 to 14 years. However in spite of several efforts on the part of the government the drop out rate is very high Secondary Education: In Maharashtra, it covers standards from Vth to Xth. Ina number of states education upto class X is free. In some states higher education for girls and for SCs and STs is free. However, the enrolment for secondary education is low and also there is high dropout ratio. Higher Secondary Education: Standards 11th and 12th constitute Higher Secondary Education. This stage is also knownas +2 stage or Junior College @ per 10+2+3 education system. In many states including. Maharashtra, the Junior colleges are either attached to schools or degree colleges. Vocational courses are introduced at junior college level in order to make education more meaningful and gainful for employment. However, except a few isolated courses, and ina few states, Vocationalisation did not achieve the desired es, Higher Education: The higher education system comprises both i technical andral education. It is also know Jucation and the normal duratic pon the duration of the course uy During the year 2017, in India, there hey than 40,000 affiliated « dents. More than 85% of st with majority « million st tachelor’s degree c BA., B.Com. or BSc. degrees Professional Education: Professional education is more specialized and is p the fields of management, accountancy, medicine, engineerng technology, etc. Itis very much required to create highly skit, manpower. As of 2017, in Indi 3 leading Technical Institutes - Indian Institutes » Technology (IIT) - Mumbai, Kanpur, Kharagpur, Che New Delhi, Goa and others. 20 Indian Institutes of Management - Ahmedabad Bangalore, Calcutta and Lucknow, Indore, Kozikhode and others. 9 All India Institutes of Medical Sciences ~ Delhi, Bhopal Bhubaneshwar, Patna, Jodhpur, Raipur, Rishikesh, Gunz (AP) and Nagpur. There are also a number of other professional instituis imparting professional education,INTRODUCTION — PARTI BUSINESS PLANNING PROCESS ee 140 [Business planning refers to a process of deciding in advance jn respect of business activities Business planning attempts to provide answers to the following questions: Whatis our present position, in terms of products, market sh profits, etc. ? © What should be our future position, say 5 years from now? What should be done to reach our future position? © Are we on course to achieve our targets? STEPS IN BUSINESS PLANNING PROCESS: 1. Analysis of Internal Environment: The business firm must analyse the internal environment prevailing within the firm ) Internal environment analysis includes analysis of © Manpower competence, commitment and dedication @ Machines and technology — Management-labour relations @ — Management policies and practices, etc. The analysis of internal environment indicates strengths a™ weaknesses of the organisation. 2 Analysis the External Environment: The business firm m analyse the external environment. The external environ’ analysis includes analysis of : Government policies Competitors’ strategiessgt Plains, Customers’ . 5, c Fequirements anq Int ti 1 Preferences international eny; ° vironment, et, The analysis of external eny ironme inthe market, and the threats rere indicate ‘ats that needs to ov setting of Corporate Objectives. bee Corres After Swi The objectives can be are €S Opportunities /ercome. ¢ Short term objectives ~ to be achieved within one year. Medium term objectives - to be achieved over a eriod of one to 5 years. el et @ Long term objectives - to be achieved over a period of more than 5 years. is The objectives must be SMART - specific, measurable. achievable, realistic, and time bound 4 Formulation of Strategies: The management team must formulate strategies. Generally, a strategy is a long term plan toachieve objectives. However, nowadays, business firms frame | short term strategies as well. The formulation of strategies is as follows: © The top management frames the corporate strategy - such as growth strategy. ® The divisional heads frame division-wise business strategy in the case strategic business units (SBUs). . department jonal strategies © The tal heads frame the functional s such as production strategies, marketing strategies, = © The lower level managers frame epost oe “Analysis of Strategies/Plans: The management mvs" analy it : must be Cost-benefit analysis Srategies and plans coy142 @ Management ph c 1-1 (F.Y.B.Com a © Costs can be analysed in terms of production, distribyy, and administration expenses. © Benefits can be analysed in terms sales, market shay, profits, goodwill, etc Selection of Best Strategy: The management or entrepreney, must select the best strategy or plan. The best strategy is :,, ‘one which fulfils the following conditions: © _Itisin ine with the mission statement of the organisation © It its with the internal environment of the organisation © Itis relevant in terms of external environment After selection of the best strategy, the management must frame plans and programmes to implement the strategy. The plans and programmes may be in respect of Research & Development Training & Development, etc. Arrangement of Resources: The management needs to make proper arrangement of resources to undertake the various activities in order to achieve the targets and objectives. There must be proper arrangement of various types of resources: © Physical resources © Capital resources © Manpower. Allocation of Resources: There is a need to allocate resources to various activities. The allocation of resource depends on certain factors such as @ Availability of resources @ Importance of activities ~ vital activities n allocated more resources. sophy ~ professional managements * je more funds towards R & D, trainin alloc development, technology upgradation, CSRpaject Planning ¢._ Implementation: After allocating resov the management must implement thew oY of strategy involves: on ¢ — Directin; and guiding the employees ¢ Motivating the employees to Perform effectively 10. Review: There must be periodic review of performance. Th Fe tare tuted to find out whether or not the organisation ison the right track to achieve objectives. If required, necessary modifications may be made in the strategy or new strategic, may be adopted 8 CONCEPT AND IMPORTANCE OF PLANNING Aproject is a planned set of interrelated tasks to be implemented over a specific period, Before starting a project, planning is necessary | fone wants to successfully complete the work. Project planning provides the blue print for starting and managing the project Project planning provides guidelines for completion of a project within a certain time-frame, usually with defined stages, and with designated resources. The activities under project planning include: Setting objectives. (A project management term for the if yi ables cae fds or services that willbe provided upon the completion of a project). Scheduling the project (the s the project) rt time and completion time of plans. Framing supportingCommerce -1 (F-¥.E 4 Importance of Project Planning Oe —————————— nning is explained as follow The importance of project p! 1. Achievement of Strategic Goals: Every successful project he. ompany to accomplish its strategic goals. To advantage, a firm must manage its projects ¢ project planning ensures that projects will not overry, deadlines and the estimated project costs. y. Efectng Time Management: Project planning facilitates tim management. The project scheduling indicates the st and completion time of every activity of the project. T project planning enables to complete the project scheduled time. 3. Minimisation of Risks: Project planning enables the comp: to minimise the risks. At the time of project planning company may frame alternative plans. If the selected p! A) faces certain problems in implementation, the comp. put plan B or alternative plan into action, thereby minimizing the risks For instance, if a company faces strong opposition by local People to start the project at a particular area, it may set up the Project in another area where there is limited or no opposition For instance, Tata Motors plant at Sin, : gur (West Bengal) was shifted to Sanand (Gujarat) to manufacture Nano cars 4. Innovation: Project planning ma of ” : y n 'y encourage creativity © innovation, For instance, if the project planning targets highly challenging, the employees of the company nied toco™ tp with innovative ideas to face the challenges and achieve ™ 5. Motivation: ptt Planning may motivate employees. Due EF eee Company may achieve higher perform™* » market share, etc. Therefore, the comp" management may motivate the employees by providit additional incentives such as increase in pay, higher bonus:ject Planning Arrangement of Resources: P, company to make proper arrany various activities. The project on the targets, the company makes proper resources such as manpower, financial reseurnes mee net posers ources and physical : parce! Clearances: Project planning involves preparation of plan. The project plan is submitted to various authorities wherever necessary. For example, the y: Fo . the project plan may be | _ submitted to Pollution Control Board to get Project clearance. |i Reference Guide: Project plan gives a clear picture about the project and acts as a reference guide during the execution of the project. For instance, the project implementers may refer to the project schedule for starting and completion of the project on time. |, Investment Decisions: Project plan supplies vital information about the cost of raising funds, operating costs, expected rate ofreturn, etc. Therefore, project plan can be used by promoters to take investment decisions such as decision relating to debt- equity ratio. 1. Project Evaluation and Control: Project plan acts as a controlling device to check the project progress. For instance, corrective measures need to be undertaken, if there any deviations between planned expenditure and actual expenditure of the project. IL. Corporate Image: Successful completion of the projects would generate hi turns to the firm. Therefore, the image of the te higher ret minds of various stakeholders such as firm improves in the mi shareholders, employees, Suppliers, et Benefits . Successful completion of the projects 1 Benefits to Stakeholder organisation. Therefore, various brings higher mar in fom proget performance of higher incentives and facilities. © Employees on account of hig! © Shareholders weal! reserves. h increases due to higher returns andCommerce (ry p ad Government benefits by way higher tax reveny, : Customers may benefit due to improveg re: products. «Suppliers would benefit by way of higher ory. supplies. Society may benefit due toemployment, and CSR ac, PROJECT REPORT A project report is a written document containing comp, information of a proposed project A project report is a blu guiding the entrepreneur to undertake the project. A project report is prepared by an expert after detailed stud: analysis of the different aspects of the project. The various of the project include analysis of market, technology, finance manpower, production facilities, etc. It is prepared to analyse te viability of the proposed project. It is helpful to various part including financial institutions, government authorities, investos and the entrepreneur himself Importance / Uses of Project Report — es / Mees of Project Report at Teport is useful to various parties. The project repo*® luated by various parties. It is useful to the following partagject Planning Itenables to select the best busin several alternatives. 1 Ithelps to locate opportunities through the ir process, It enhances the p: alternative, after ability of success by addressing and mitigating factors early that could affect the pi ™ yject + Itprovides necessary information for decision making relatir to the operations of the proposed project and other activities in the organisation. 4 Ithelps to increase investment in the company + It provides documentation that the business ver thoroughly investigated |Project ReporT V/s Feasibility Report ———— Ee PROJECT REPORT ing: Ihis a written report containing nplete information about the eee pecjec ina ney orm. l-Who prepares: Its prepared by the promoters th the help of experts. FEASIBILITY REPORT Itis a written document containing | in detail the findings of feasibility ~} study in respect of marketing, It is prepared by promoters or by Feasibility Report is prepared on the basis of feasibility study It is useful to find out commercial viability of the project ie. rate of] success or failure of a prokect__J6. Submission: Iris submitted to banks, Fis and other major investors to invest in the firm. 7. Government Clearances: jearances Generally, it is retain interested part feasibility hat Feasibility report is not r Itis required for govt. ch such as clearance from Po Control Board. 8. Details for Government cleara olution It is a brief report whi whether or not it is wort ed information on It gives deta promoters/investors, capital assets, marketing plans, etc undertaking a project F Size of Projects Generally, project report is prepared in the case of medium as well as large size projects. F the case of la involving hu; bility report is prepan ized proje funds. BUSINESS UNIT PROMOTION - PARTII & ‘CONCEPT : Business unit promoti . ion refers to all those activities relati"$ Setting up and promotion of business os e activitie Sse of Business Unit Promotion The following are the m, sf Stages in setting up of a busines : of Business Opportunity The entrepreneur must identif, o venture. apace an opportunity to undertake?" *chniques such as: PPortunity can be generated throug”