Category: Commerce Notes PPT

Marketing is the process of acquiring the right goods or services or even the ideas to the right people at the right place, right time, and price, also using the right promotion techniques to provide the customer services that are associated with the goods, services, or the ideas. 

The concept which is referred to as the “right” principle is the main basis of all the marketing strategies that are used by a business. Marketing is about creating exchanges that would bring a positive change in the livelihood of the people. This exchange takes place between two parties that give something of value to each other to satisfy their own needs or wants. 

Societal Marketing Concept 

Societal marketing is the concept that holds the notion that a company should make good marketing decisions prior to considering the consumers’ wants, the company’s requirements, and society’s long-term interests at large.

Philip Kotler, the father of marketing defines Societal Marketing as “the societal marketing concept holds that the organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and the society’s well-being.”

Societal Marketing builds a favorable image for the company which increases sales. This is a term that is closely related to CSR and sustainable development in that regard.

Societal Marketing emphasizes social responsibilities and suggests a business to sustain with this principle.

Selling Concept 

The selling concept refers to a process in which a business justifies that the consumers will not be willing to purchase enough of a business’s product or services without a persuading promotional campaign. This concept is used mostly in the industries which create goods that the consumers usually don’t consider buying. These companies generally have large sales forces and focus their energies and strategies on selling their products.

Holistic Marketing Concept 

Holistic Marketing Concept is the part of a series on the concepts of marketing which defines the marketing strategy that is considered the business as a whole and not as an entity with various different parts. 

According to this holistic marketing concept, if a business is made of various departments, then the departments are required to come together to represent a united business image in the minds of the customers. The holistic marketing concept is interconnected with marketing activities that ensure the customer is likely to purchase their product rather than falling into the competition.

Marketing Philosophies 

1. Production Concept

This concept is ruled on the efficient production process of a company. As in the days of the industrial revolution, this is believed that goods that are available in excessive quantities and at cheap prices will always sell no matter what.

2. Product Concept

In the product concept, the company will make sure that their goods are of the standard quality. This means the cost of production and the price of the product will be higher. In this case, the company will look to maximize its profit with promising quality products.

3. Selling Concept

This concept has a shift. A shift from the production of the product to only selling the product. Even after the goods satisfies the price and quality requirements of the consumer, the sale is not guaranteed. Thus, in the selling concept of marketing management philosophies, the strategy is to persuade the consumer to buy the product by whatever means necessary.

4. Marketing Concept

Marketing is added as one of the newer marketing management philosophies. It is a very recent concept which truly believes “the customer is king”. All the decisions are directly or indirectly influenced by the needs of the customer. Right from the production to designing of the goods till its transportation, each process has customer satisfaction in mind.

5. Societal Marketing Process

At times the need of the customer and the requirement of the company are not best suited to society or the environment. Since the business is a part of society, a businessman must ensure society’s well being as well. So, this concept will focus on the satisfaction of consumer needs undoubtedly also without harming the society or the environment in the process of satisfying.

Production Concept in Marketing 

Production is a Concept which is moreover a belief which states that the customers would always acquire the products which are cheaper and more readily or easily. The production concept basically means that the more the products or production more will be the sales. In countries where the labor is cheap and is easily available, like in our nation, the production can be maximized while minimizing the costs, thereby increasing the production efficiency.

Social Entrepreneurs are individuals who are willing to create positive changes in society through their innovative ideas and efforts. They run their business or organization to achieve their goals by helping society. Their motto to start a business venture is primarily to help society and have no great intention of making personal profits. Their success is not always measured in terms of profit alone. A small change in the society out of their efforts is a success too. Social entrepreneurship is also referred to as altruistic entrepreneurship –which translates to selfless concern for the well-being of others.

There are many environmental and social problems out there and social entrepreneurs identify those problems and come up with innovative ways, and establish or adopt a business model around it. By presenting user-friendly and adaptable ideas to the local people, social entrepreneurs are generally looked up to as leaders or role models for driving philanthropic projects and bringing a large group of people to believe in their initiative. In the recent past, there have been many social entrepreneurs or philanthropists who have made immense success and proven to the public that not all needs of society are to be solved by the Government. Any person with a vision and the ability to bring change can do it.

Below are a Few Examples of Leading Social Entrepreneurs

• Vinoba Bhave (India)  was the leader and founder of the Land Gift Movement. He led to the redistribution of around 7,000,000 acres of land that later on helped the landless and untouchables of India.

• Dr. Maria Montessori (Italy) – The Montessori approach to early childhood education was developed by her.

• Elon Musk, Tesla Motors, SolarCity, and SpaceX caused Musk to become an explorer of social entrepreneurship in the modern era, as he pursued to create solutions that are accessible to renewable energy and push the bounds on space exploration for the human race.

Social entrepreneurship has similarities and distinctions when compared to the standard definition of entrepreneurship

Importance of Social Entrepreneurs

Social Impact and Inspiration: the origination of a social enterprise is an existing gap or problem that an individual identifies and has a solution for. Social entrepreneurs’ works tackle the existing problem of society, they do not intend to create legacies and are an inspiration to society.

Make the World a Better Place: Social entrepreneurs are obsessed and extremely passionate about the initiative and work towards the goal against all odds, and can go to any extent to see that society is problem-free. It is the social entrepreneurs who can bring drastic changes to culture, business, and economy while they make a living out of it.

Generation of Social Capital: One of the most important values and powerful influences created by Social entrepreneurs is the equation established by social groups through interpersonal relationships, a shared sense of identity, and a shared understanding in their network that helps people to ‘get by, accept and get ahead’ with changes.

Factors the Strengthen Social Entrepreneurship

How the Project Contributes to the Economy: Having known social entrepreneurship is for the society or environment, it also means there is or has been a demand for the product or service. Most entrepreneurial initiatives contribute to the economy, by creating job opportunities and wealth. The social enterprise thus established must aim at generating enough wealth that can contribute to society. 

Responsibility Towards Society and Environment: The primary intention of social enterprise is to identify gaps in the environment and society that are not working efficiently and create a social value out of those. Aimed at bringing in a change and something new to solve a certain problem, these objectives can vary from industries, health services, education, energy-saving, etc. A lot of corporate entities form a small trust to implement these objects in the form of Customer Social Responsibility (CSR)  projects. 

Effective Profit Utilization: As discussed, earlier social entrepreneurs are not aimed at making personal profits, their profits are often re-invested in the business to achieve the goal, personal profits are hence supervised and are limited. However, depending upon the status of the project, the entrepreneur can decide how much is to be reinvested to achieve the goal.

Efficiently Managed: Unlike the standard entrepreneurship framework, social entrepreneurship can involve a group of people working together with the same intention of bringing a change to society. Hence, the decision-making, execution of tasks, etc. are all shared and are done with the active participation of all experts at different levels. Here, making use of participation efficiently is the key.

Conclusion

Entrepreneurship has been the booming and most pursued carrier option in recent times. Many top college graduates have set up their own companies and thrived excellently in their respective domains. Entrepreneurs lookup for a gap in the demand and supply chain in the market and using their agencies of creativity, innovation, and resourcefulness they find a solution in the form of a product or service that will fill in the gap. 

Thus, they bring in the market something that is in great demand already. This way they are able to generate a good amount of sales and hence earn a good profit as well. Entrepreneurship is mostly pursued as a career option because it gives the liberty of being your own boss and also to exercise your creativity and innovativeness with no restrictions. Once launched well and settled up, it brings up a lot of opportunities for expansion and collaboration. The profit one generates is also better than what one may have got while doing a job. 

More about Social Entrepreneurship

Social entrepreneurship is the one branch of this tree that is not much concerned with the money or royalties that they may avail after being an entrepreneur. Social entrepreneurs are more concerned with the betterment of society and work in the direction accordingly, though they also look for profit margins, it is very marginal and their main aim is the enhancement of socio-economic conditions. They may or may not already have a good amount of wealth. If they don’t, they mainly try to launch that company or industry which will lead to the development of jobs, create a money flow in the local economy and utilize the skills of the local artisans. This way they ensure that the local skill potential is utilized and also that profit is generated. On the other hand, if they have a good amount of wealth they will try to manage the resources properly and develop employment opportunities for the local population without caring much about their own profit. 

Social entrepreneurship has become a very critical driving force in the national and local economies of the country. This type of entrepreneurship has been incorporated into the policies of govt as well and govt has subsidized many such establishments which pursue the development of the local economy. 

Social entrepreneurship has been also admired by the local populations as well because these ventures create a great positive impact regarding enhancing the lives of local people in terms of monetary security and job creation.

Mercantile Law is a repository of all the Laws included in a company to handle or look after its commercial activities. It is a generalized term for the entire legal body. All the other acts like the company act, limitations act, Indian contract act, etc. are subsidiaries of the Mercantile Law. And the acts are known as Mercantile Law acts.

It deals with all the commercial transactions of the trader, whether it is an individual or an organization or maybe a joint venture. The commercial transactions include the agreements between both parties, operational activities, the delegation of work, financial transactions, memorandum of associations, etc. So let us understand the meaning of Mercantile Law and its sources, scope.

Mercantile law is a combination of various laws and principles of individuals having legal knowledge to resolve various issues in the company. But in 1872, all these laws are joined and termed as mercantile law and from then to regulate various issues of your company several acts are formed respectively such as the Indian contract act, the company act, the limitations act, etc. from the definition of mercantile law it is clear that it has a very wide scope.

Mercantile Law, also known as Commercial Law, governs the commercial activities of the economy. It is a broad term that encompasses all of the Laws in India that govern commercial transactions. Such a transaction necessitates a valid agreement between the contract’s parties. It can be explicitly stated or implicitly stated.

It is concerned with traders’ rights and obligations arising from commercial transactions. The trader can be an individual, a partnership, or a corporation. The Mercantile Law of India encompasses all Indian Acts that govern trade or commerce. For example, the Indian Contract Act of 1872, the Sale of Goods Act of 1930, the Companies Act of 2013, and so on.

 

Principal Sources of Mercantile Law

1. Law Merchant: The main source of Mercantile Law is the Law merchant. It refers to the customs and rules that govern traders’ and businessmen’s dealings and transactions with one another.

2. Statute Law: Legislation creates Law, which is referred to as statute Law. A statute is a written formal act of the legislature. It has also evolved into a significant source of Mercantile Law.

3. The Principle of Equity: The principle of equity refers to a set of rules that are not based on customs or statutory Law. As a result, equity rules were formed based on the basis of conscience dictates decided in chancery courts.

4. Common Law: Common Law is a set of rules defined by customs, judicial decisions, and old scholarly works on the subject. It is an unwritten English Law that applies to everyone in the country. In this context, common law refers to legal principles developed by judges through case decisions.

 

Principal Sources of Mercantile Law

The Indian Mercantile Law has various sources similar to that of English Mercantile Law. Some of the principal sources of Mercantile Law are-

1. English Mercantile Law

English Mercantile Law is an unwritten, generalized Law of England to deal with customs and judicial activities which has equity Law, merchant Law, common law, and statute Law as its sources.

As India was under the control of the British for a longer time, the Indian Mercantile Law is derived from the English Mercantile Law meaning. All the concepts, formats can be taken from it English Law. Even in recent times also if any issues are unsolved, our judicial heads will take help from the English Mercantile Law. 

2. Enacted Acts by Indian Legislature

Some of the acts involved in the Mercantile Law are enacted by the Indian legislature. These acts are listed below-

• The Carriers Act(1865)

• Indian Contract Act(1872), 

• Negotiable Instruments Act(1881)

• The Presidency Town Insolvency Acts(1909) and 

• Provincial Insolvency Act (1920)

• Sale of Goods Act(1930),

•  Indian Partnership Act(1932)

•  The Insurance Act(1938)

• The Arbitration and Conciliation Act(1996)

3. Judicial Decisions 

Judicial decision refers to the decisions made by individuals having judicial powers. It means that judges available in the courts will form certain rules and ask their subordinates to follow. And it is fixed and constant for all the cases. The Indian government has given authority in such a way that if the high court makes a judgment, it should be obeyed to all its subsidiary courts whether they are favorable or against.

Similarly, if the judgment has been given by the Supreme Court, it should be followed by all the courts of India except itself because it is the highest state of the Indian judicial body. The judgment will be common and will be in a written format which sets as a prerequisite for various cases in the future. The limitation is as the case may vary from one to another, the organization may vary from one to another; the judgment will be constant.

4. Customs and Trade Usage

It is a significant source of Mercantile Law. The Indian legal bodies give high priority to customs and trade. The codified Law also supports it. It provided all the powers required for the customs department, and section 1 of the Indian contract act is the best example to understand the importance of customs and trade usage as a major source of Mercantile Law.

“Nothing herein contained shall affect any usage or ……….inconsistent with the Act.” it is completely bound by the customs, and it is not against the public policy. So the legal body considered it and registered it as a legal obligation.

Similarly, we can understand all the principal sources of Mercantile Law only with the Mercantile Law examples.

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Hence, by observing the meaning of Mercantile, we came to know easily that the scope of Mercantile is very wide, and each source of Mercantile Law plays a predominant role. As it deals with all commercial activities of your company or an individual, it is good to have sound knowledge of all other acts which are included in the Mercantile Law.

Modern management and decision-making are integral to each other in nature. Managers in today’s age and time are always pressed for time hence it is imperative for them to use their time wisely in deciding whether a decision making process can be structured with a routine applied to it (programmed decision) or decisions that require thought and focus as they are novel (nonprogrammed decisions). Every manager is constantly taking such decisions all through their working hours, either consciously or subconsciously. 

This article will go through definitions of programmed and nonprogrammed decision making process along with examples of programmed and unprogrammed decisions. You will also be able to find out the difference between programmed and non programmed decisions.

 

Programmed and Non-Programmed Decisions

In management, there are mainly two types of decision making programmed and nonprogrammed.

Programmed decisions can be taken when something is repeated over time, and a set of rules can be devised to guide the process of such decisions. Programmed decisions can be simple or fairly complex, but the main thing about such decisions is that the criteria for making such decisions are either completely known or can be estimated with a fair degree of accuracy. Few examples of programmed decision are listed below:

• The decision to buy raw materials for producing goods is based on the amount to be produced, items in stock, time of delivery, etc. 

• The weekly work schedule of part-time workers in a retail store can be worked out based on how busy the store is in that time period, how many regular employees are available or applied for vacations, etc. Though establishing a schedule is a complex decision, yet it falls under programmed decision since a structure can be applied to the process.

The main technique that managers use for making programmed decisions is developing a mental shortcut or heuristics to help them reach a decision. 

On the contrary, a non programmed decision making process lacks structure and routine. This is the primary difference between programmed decision and non programmed decision. A nonprogrammed decision definition is a decision that does not follow a set procedure, and the criteria for such decisions is not well-defined. The main characteristics of an unprogrammed decision are:

• Information on which decision is based is generally incomplete or ambiguous.

• The decision-maker needs to use his/her creative thinking and judgment while dealing with a non programmed decision making process.

• Non-programmed decision making is also referred to as high-involvement decisions or nonroutine decisions since they need a high level of involvement on the part of the decision-maker.

The table below depicts the key differences between a Programmed and a non-programmed decision:

Difference Between Programmed Decision and Non Programmed Decision

Example of Non Programmed Decision In Business

In business, non programmed decisions are taken mostly by high-level management where crucial decisions are taken that involve a lot of unknowns. Few examples of an unprogrammed decision are:

• Whether a company must acquire another organization or not.

• Whether a new technology must be adopted or not.

• In which global market, the business has the highest potential.

Modern Techniques for Non Programmed Decisions

One needs subjective judgment for badly-defined problems that are non-recurring, novel, and unstructured. Though a standard procedure can not be applied when it comes to non programmed decision making, there are a few techniques that managers take for making non programmed decisions as described below:

• Brainstorming Technique 

Alex Faickney Osborn (also called the “father of brainstorm”) developed this technique of non-programmed decisions. He was an advertising executive in the United States. This method aims to improve problem-solving by devising new and creative solutions. A typical brainstorming session has 5 to 10 people in a group where the leader of the group presents the team with the problem in hand. Members are supposed to come out with all possible ideas, and each idea is then discussed and analyzed. The best idea, as per the consensus, is then selected after the session is over.

In a Delphi technique, a similar process as brainstorming is performed except for the fact that the members of the group do not meet each other face to face. Group members could be spread across the city, state, or even belong to different countries. Group members use modern tools like video conferencing to interact with each other. People can even use a questionnaire, which is a list of questions about the problem, to gather information from the members of the group. Delphi technique is a very effective method for non programmed decision making since in this, members do not see each other hence they are not affected or influenced by views and opinions of each other about the problem. This technique is also quick since the group uses modern tools and technologies to interact with each other.

• Nominal Group Technique 

In this technique, each group member thinks and comes up with ideas and solutions in isolation. There is no interaction between the group members in the initial stages of the decision making process. Group members start interacting once all of them have come up with an idea.

This was started in the 1960s in Japan where a small group of employees from the same department would voluntarily meet regularly to identify, analyze, and solve various types of problems related to their work.

This technique applies various aspects like the rule of thumb, experience, common sense, etc. An example of such an approach is enabling payments in installments for a product as the company feels that people would be more inclined to buy the product if they do not have to pay a lump sum amount but can break it into installments.

The subject of Business Economics is a wide study. The study is mainly concerned with the economics of the business. Business Economics particularly bridges down the gap of theoretical knowledge of economics and practical application of the same in the conduct of business. 

In this context, we are going to discuss the fundamental aspects of business economics, the division of business economics, and the nature and scope of the same are to be studied. 

Definition of Business Economics

In simple terms, we can say that business economics is a concentration of applied economics that deals with the finance, organization, market, and environment-related factors which are primarily faced by the companies or business organizations.

Business Economics studies the key elements of scarcity thus dealing with its concept, the product factors, distribution, and consumption of these resources.  

Division of Business Economics – Macroeconomics and Microeconomics

The prevalent theories which we study on economics seem to be simple, while the actual application is a much more complex task. The managers who are new to the field face the maximum trouble in correlating their recently learned theories and their application in the real world. For such scenarios, the manager needs to know business economics. Business economics is an amalgamation of logical and analytical tools that attempts to solve the differences between the theories and the practice. It is important to study the details of the nature and scope of business economics. 

However, for a better understanding of the concepts, it is important to understand the two major parts of economics- microeconomics and macroeconomics.

Microeconomics

Microeconomics is defined as the study of the decision-making process of individual units with respect to the proper allocation of their limited resources. These individual units are also called firms or consumers. The focus is directed to individual units or a small number of units instead of a combination of all the units. It provides a restricted picture of the situation and excludes the broader economic environment. The study of microeconomics includes the following topics.

Macroeconomics

Macroeconomics is defined as the study of the economical behaviour of larger aggregates like total consumption, overall output, and it also considers the shift in the position of these aggregates. Therefore, it encompasses all the decisions made by different consumers and their effect on the overall economy. The study of macroeconomics includes the following topics.

• General price and rates of interest,

• National output,

• National income,

• The external value of the national currency,

• Balance of payments,

• Balance of trade,

• Rate of economic growth,

• Level of employment.

Nature of Business Economics

To explain the nature and scope of business economics, it is important to look at it from the following angles.

Science can be defined as a systematic approach to generating a relationship between cause and effect. Statistics mathematics and econometrics are all considered to be decision sciences. To describe the nature of business economics, it can be considered as an integration of decision sciences with the theories of economics, so that the businesses can strategize their plans to achieve their goals. It follows a scientific approach and also checks the validity of all the results thus obtained.

Looking into the basic differences between microeconomics and macroeconomics, a businessman will certainly first focus on the objectives and the achievements of his own organization. He should target his profit-making abilities and ensure the long-term survival of his company in the first place. Business economics focusses more on the analysis and decision-making abilities of the individual businesses and therefore utilizes the techniques related to the concept of microeconomics.

Although business economics is largely based on the microeconomy, the nature, and scope of business economics notes certain concepts of macroeconomics as well. For example, although any business will mainly focus on its survival in the market and on its profits, it cannot function in isolation. External factors like tax policies, the country’s economy, employment rate, income, etc., are considered within the purview of macroeconomics.

Therefore, although a business is mostly considered as a segment of microeconomics, the nature and scope of business economics also contain elements of macroeconomics.

The concept of art can also be used to discuss the nature and scope of business economics. It also involves the practical application of regulations and rules to move forward towards the goals of the company.

Business economics considers the resource allocation theory prevalent in the private enterprise economy. Therefore the nature and scope of business economics notes also include market and private enterprise theories.

In comparison to the theoretical nature of the microeconomy, business economics has a pragmatic approach. It is more related to finding efficient solutions to the problems faced by companies in the real world.

Business economics has an interdisciplinary approach by involving disciplines from statistics, mathematics, marketing, accounting, etc.

On a broader basis, economic theory can be described in two ways- normative and positive. Normative science includes judgments that have values. It analyses the circumstance and provides suggestions on the course of action. A positive approach establishes a scientific approach to define the cause-effect relationship without the involvement of any value judgment. Business economics provides more focus on the normative approach but considers both approaches.

Scope of Business Economics 

The scope of business economics can be put under various heads:

1. Microeconomics which deals with Operational Issues

2. Macroeconomics applied to environmental issues. 

This was an exhaustive study of the preview of Business Economics. The study is segregated into two divisions which we have thus studied. From the academic point of view, theoretical understanding is required, while if you want to opt for business then the practical application of the same study is to be done. 

For a business to continue working, there must be some distinct objectives that the owners and the managers of the business will work thoroughly to make it happen and working for that particular objective is what is meant in simple terms as the business objective.  

 

There are various kinds of business objectives, the business objective is defined and being identified in different classes. In this section we will continue our discussion about ‘Business Objective’ with ‘Economic Objective’ and ‘Social Objective’ among other objectives of the business.

  

Introduction

Business objectives are very specific and measurable in net results. Companies maintain their objectives as the organizational goals as their organization expands. Entrepreneurs and business leaders must track the performance with the objectives to check whether their business is moving in the right direction. 

 

Business objectives act as the compass for the company, directing how the organization should allocate its resources, make their weaknesses overcome with their strengths, and tap opportunities that might be available. Most of the time, objectives remain the same until any external or internal circumstances change.

 

While business goals describe the company’s end purpose, objectives direct the directions to reach the goal.

 

Role of Business Unit

Though it is believed that a business has a single objective, that is, to make profit, that is not the only objective of business. With pursuing the objective of earning profit, business units do keep the interest of their owners in view. However, any business unit will not ignore the interests of its employees, customers, the community, as well as the interests of society as a whole. 

 

For instance, no business can prosper in the long run unless fair wages are paid to the employees and customer satisfaction is given due importance. 

 

Also, a business unit can only prosper if it enjoys the support and earns goodwill of people in general. Business objectives also contribute to national goals and aspirations as well as towards international well-being. Thus, the objectives of business may be divergent.

 

Economic Objectives of Business

Economic objectives refer to the objective of earning the profit and also other objectives which are necessary to be pursued to achieve the profit objective. This includes – creation of the customers, regular innovations and best possible use of the available resources. Profit is the lifeblood of business, without this no business can survive in a competitive market. 

 

In fact, profit making is the primary objective for which a business unit is brought into existence. Profits must be earned to ensure that the business survives, its growth and expansion over time. Profits help businessmen not only to earn their living but also to expand their business activities by investing into expansion of business sectors. 

 

Other Supporting Objectives are

• Creation of Customers: The supply of any business is directly proportional to its demands; and demands are raised and met efficiently through extending the market share of the business. More customers mean higher demands, which upon being met by the business organization results in higher profits- meeting the economic objective of the business.

In the long run, a business’s profit-making capacity tends to completely depend on the number of customers it caters to. By providing good quality products or service, a business can expand its market share or create loyal customers, that in turn will ensure stability in the future. 

• Regular Innovations: The days have gone when there were only a countable number of business organizations around the world. In this century there are multitudinous businesses working day and night in almost every part of the world. Hence, it is extremely important to not only survive but to keep up in this world of dynamic competition. To do so a business needs to regularly invest in new technologies and innovations. It is only by providing unique products and services through innovative ideas that a business can run in the long run. 

• Best Possible Use of Resources: A business only has a limited number of resources and it is on the business decision to effectively utilize these resources- like raw materials, labor, capital- in the correct departments. Large corporations survive because they utilize their resources efficiently and invest huge amounts of capital in new innovations.

• Productivity Increase: Although this is the hindmost objective of any business but that doesn’t mean it’s not equally important. Productivity of a business depends on the overall output produced by the different activities that are carried out in any business organization. It shows how effectively and efficiently a business is working. More productivity will guarantee a business’s development in the long run. This goal can be achieved by utilizing labor, raw materials and capital efficiently, and minimizing wastage of the resources available.

 

Social Objectives of Business

• This objective is desired to be achieved for societal benefit. As business operates in a society and by utilizing its scarce resources the business functions, the society thus expects something in return for its contribution. No activity of the business should be aimed at giving any trouble to the society. If business activities lead to socially harmful effects, there is bound to be a public reaction against the business sooner or later, and thus social objectives should be objected to compensate for the same.  

• Social objectives of business include production and supply of quality and standard goods and services, adoption of fair-trade practices and contribution to the general welfare of society and provision of welfare amenities.

Production and Supply of Quality Goods and Services at Reasonable Prices: 

• A business exists because of its customer; and the customers together fabricate a society. Hence, a business exists because of the society it serves through the production and supply of goods and services. These products and services should not only be of good quality but also have reasonable prices so that the customers are in the capacity to buy them. Products or services that have irrationally high prices automatically divert the customers to go for its competitor business. An ethical business does not hoard its products or engage in shrewd marketing strategies to attract customers. 

• Adoption of fair-trade practices

 

Contribution to the General Welfare of the Society: 

• Unemployment is a considerable issue that society faces in different parts of the world. Since the world runs through business organizations, it comes under the social responsibility of these businesses to generate employment opportunities for individuals of the society it serves. Through this it contributes to the general welfare of the society.

 

Fair Wages to Its Employees: 

• Trade unions can hinder the daily workings of any business organizations; and they are most probable to be formed in businesses that do not treat their employees ethically. A business does not only run-on raw materials, machines and capital; it comprises the diverse employees that make these machines work for the development and eventual success of any business. These employees are the most essential assets of a business, but before that they are human beings that live in the same society in which the business runs.

• Hence, it is important to provide these employees fair wages for their hard work. Employees benefit programmes are also an important part for a business to meet its social objective. Such benefits will give the employees a sense of association with the business and motivate them to work proficiently towards its expansion.

 

Performing Community Service- 

• The business is established and developed in a society. It works because of the society; so, it is the responsibility of any business organization to give back to the society in whatever considerable amount it can. It can do so by building public toilets, dispensaries, and transportation. It can also contribute to the growth of society by encouraging education and literacy through building foundations like schools, colleges, and libraries.

• If a business is not in the financial capacity to build any institutions or infrastructure, it still has a way to give back to the society by donating to NGOs which work in diverse fields of services.