BUSINESS STUDIES chapter 1 notes (2nd part)

Business can be divided into two types industry and commerce. The full classification is given below with the help of a diagram:-

1. Industry: Industry refers to a group of forms which converts raw material into useful products. Industry can be classified into three categories:-

•primary industry 

•secondary industry 

•tertiary industry

• primary industry:primary industry includes all those industries which are connected with the extraction in production from natural resources as well as reproduction and development of living organisms, plants. These industries may further subdivided as follows :

1. Extractive industries:these industries extract or draw out products from natural resources.extractive industries supply some basic raw material that are mostly the products of soil . Products of these industries are usually transformed into many other useful goods by manufacturing industries example mining etc

2. Genetic industries: the industry's remain engaged in breathing plants and animals for their use in further reproduction. For the breeding of plants , the seeds and nursery companies are typically example of genetic industry.

• secondary industry: secondary industry is concerned with the using of materials, which have been already extracted at the primary stage . These industries processes such materials to produce goods for final consumption or further processing by industrial units. Secondary industry can be classified into two kinds:-

1. Manufacturing industries: these industries are engagedin producing goods through the processing of raw materials and thus creating for utilities. manufacturing industries may be further divided into four categories on the basis of method of operation for production:

(a) analytical industry:analytical industry which analyses and separates different elements from the same material , as in the case of a oil refinery.aur another sense we can say that this industry uses only one basic raw material to prepare different finished goods ( example crude oil).

(b) synthetic industry: it combines various ingredients into a new product. Example cement industry.

(c) processing industry: it involves successive stages for manufacturing in finished products .example sugar and paper industry.

(d) assembling industry: It assembles different component parts to make a new product as in case of television , car , computer industry . The product of these finish goods can be sold individually.

2. Construction industries: these industries are engaged in some construction work. For example building, dam etc.

• Tertiary industry or service industry: this industry deals with providing support services two primary and secondary industries as well as activities relating to trade. These industries provide service facilities. As business activities these may be considered part of commerce because as auxiliaries, they assist trade. These are typically financing, insurance, transportation and communication industries. The various type of services provided by them can be listed below:

1 . Transport

2. Banking

 3. insurance 

4. warehousing

5. advertising 

2. Commerce:commerce refers to all those activities which are concerned with the transfer / distribution of goods and services from producer to consumers.

It embraces all the activities which are related to distribution of goods and services. It embraces all the activities which are necessary for maintaining or free flow of goods and services.

The functions of commerce are:-

•removing the hindrance of person by making goods available to consumers from the producers through trade.

•Transportation removes hindrance of place by moving goods from the place of production to the markets for sale.

•storage and warehousing activities remove hindrance of time by  facilitating holding of stock of goods to be sold as and when required.

•Insurance removes hindrance of risk of loss old damage of goods by providing protection to the employees also against the risk of accident while working such as theft , 🔥 fire etc.

•banking removes hindrance of information of finance by providing funds to a businessman for acquiring assets ,purchasing raw materials and meeting other expenses .

• Advertising  removes hindrance of information by informing consumers about the goods and services available in the market. 

Commerce can be classified into two types:-

1. Trade:-it refers to buying and selling of goods and services.  It can be classified into two types