UNIT 1- NATURE OF A BUSINESS

- Barter: A system of exchange where goods or services are traded without using money.
- Advantages:
1. No need for money
2. encourages creativity and resourcefulness.
- Disadvantages:
1. Limited scalability,
2. difficulty in finding mutually beneficial trades ( someone who has what you want and
want what you have.)

- Money: A medium of exchange, unit of account, and store of value.

- Instruments of Exchange/Payments:
1) Barter: Trading goods or services without money.
2) Bills of Exchange: A written order to pay a specific amount.
3) Electronic Transfer: Transferring funds electronically.
4) Tele-banking and E-commerce: Online banking and shopping.
5) Cheques: A written order to pay a specific amount.
6) Money Order: A prepaid payment instrument.
7) Debit Cards: Paying with funds from a bank account.
8) Credit Cards: Borrowing money to make purchases.
9) Bank Draft: A guaranteed payment instrument.
10) Telegraphic Money Transfer: Transferring funds via telegraph.
11) Bank Transfers: Transferring funds between bank accounts.
12) M-money/Mobile Money and Mobile Wallets: Using mobile devices for
payments.

- Private Sector: Businesses owned and operated by individuals or private companies. Eg,
supermarkets, business places, private school, private hospitals
- Public Sector: Government-owned and operated organizations. Eg, schools, tax offices,
hospitals

- Forms of Business Organisations:

a. Sole Trader: A single owner-operated business.
b. Partnerships: A business owned and operated by multiple individuals.
 c. Co-operatives: A business owned and controlled by its members.
d. Companies: A business owned by shareholders, including private and public
limited companies.
e. Franchises: A business operating under a licensed brand.

Types of Economic Systems:

a. Traditional (Subsistence): Economic decisions based on customs and
traditions.
b. Command or Planned (Socialist): Government-controlled economy.
c. Free Market or Capitalist: Private ownership and free market principles.
d. Mixed (Public and Private): A combination of government and private sector
involvement.

Functional Areas of a Business

- Functional Areas:
a. Production: Creating goods and services.
b. Marketing: Promoting and selling products.
c. Finance: Managing financial resources.
d. Human Resource: Managing personnel and organizational development.
e. Research and Development: Developing new products and services.

9.Stakeholders Involved in Business Activities

- Stakeholders: Someone with a common interest in the business
a. Owners: Investors and shareholders.
b. Employees: Personnel working for the business.
c. Consumers: Customers purchasing goods and services.
d. Suppliers: Providers of goods and services.
e. Communities: Local communities affected by business activities.
f. Environment: The natural environment impacted by business operations.
g. Future Generations: The potential impact on future generations.
h. Government: Regulatory bodies and government agencies.

Role and Functions of the Stakeholders Involved in Business Activities

- Role and Functions:
a. Employers: Providing jobs and managing personnel.
b. Employees: Providing labor services and contributing to business operations.
 c. Consumers: Purchasing goods and services.
d. Suppliers: Providing goods and services.
e. Communities: Providing support and resources.
f. Government: Regulating business activities and collecting taxes.

Ethical and Legal Issues in the Establishment and Operations of a Business

- Ethics: Knowing right from wrong and actually doing the right.
- Unethical- Not doing the right thing even when you know the right.

- Ethical and Legal Issues:

a. Ensuring Legitimate Business Operations: Avoiding money laundering and
other illicit activities.
b. Legally Obtained Capital: Ensuring capital is obtained through legitimate
means.
c. Payment of Taxes and National Insurance: Complying with tax laws and
regulations.
12. Principles that Must be Adopted in the Establishment and Operation of a Business
- Principles:
a. Code of Ethics: Adopting a code of conduct that guides business decisions.
b. Environmental Policies: This involves developing policies that promote
sustainability and reduce environmental impact.
c. Handling Personal Information: Protecting customer and employee data.
Consequences of Unethical and Illegal Practices in Business
-Consequences:
a. Misleading Advertisements: Unfair and fraudulent practice that can damage
consumer trust.
b. Withholding of Tax: Cheating the government of revenue, which can lead to
penalties and fines.
c. Unethical Disposal of Waste: Pollution and environmental harm.
d. Money Laundering: Distortions in the national economy and potential for
financial instability.

- Careers in Business:
a. Advertising and Public Relations: Creating and managing advertising campaigns
and public image.
b. Compliance Officers: Ensuring businesses operate in accordance with laws and
regulations.
c. Strategic Planners: Developing business strategies to achieve goals.
 d. Educators: Teaching business-related subjects online or face-to-face.
e. Information Officers: Managing and disseminating business information.
f. Entrepreneurs: Starting and running their own businesses.
g. Resource Personnel: Managing human resources and personnel development.
h. Web Designers: Creating and designing websites for businesses.
i. Web Planners: Planning and developing online business strategies.
j. Software Developers: Creating software solutions for businesses.

UNIT 2- INTERNAL ORGANISATIONAL ENVIRONMENT

-Functions of Management:
a. Planning: Creating short-term and long-term goals and sourcing necessary resources.
b. Organising: Structuring and allocating resources.
c. Directing: Guiding and supervising employees.
d. Controlling: Monitoring and adjusting performance.
e. Coordinating: Integrating activities and departments.
f. Delegating: Assigning tasks and responsibilities.

- Management Responsibilities to stakeholders:

a. Owners and Shareholders: Maximising efficiency and creating surpluses.
b. Employees: Providing adequate working conditions, training, and maintaining
good communication.
c. Society: Contributing to social welfare and environmental sustainability.
d. Customers: Delivering quality products and services.
e. Government: Complying with laws and regulations.
- Simple Organisational Charts:
a. Line: A simple hierarchical structure.
b. Line and Staff: A structure with both line and staff roles.
c. Functional: A structure organised by function or department.

4. Interpret Simple Organisational Charts

- Interpretation:
a. Chain of Command: The hierarchy of authority.
b. Span of Control: The number of subordinates reporting to a manager.

Characteristics of a Good Leader

- Characteristics:
a. Honesty: Integrity and trustworthiness.
b. Flexibility: Adaptability and openness to change.
c. Focus: Clear goals and priorities.
d. Trustworthiness: Reliability and credibility.
e. Intelligent Decision-Making: Ability to make informed decisions.

Leadership Styles:
a. Autocratic: Centralised decision-making and control.
b. Democratic: Participative decision-making and empowerment.
c. Laissez-Faire: Minimal intervention and maximum autonomy.

Internal Sources of Conflict:

a. Poor Working Conditions: Uncomfortable or hazardous work environment.
b. Other sources: communication breakdowns, conflicting goals, and personality clashes.

Strategies Used by Employers and Employees to Gain an Upper Hand during Periods of
Conflict
- Employer Strategies:
a. Lockout: Excluding employees from the workplace.
b. Use of Scab Labour: Hiring replacement workers.
- Employee Strategies:
a. Strike: Collective work stoppage.
b. Work to Rule: Strict adherence to rules and regulations.
c. Call out – don’t turn up to work
d. Use sick days
e. Work slow / go slow method

Strategies for the Resolution of Conflict within an Organisation

- Strategies:
a. Mediation: Neutral third-party facilitation.
b. Arbitration: Binding decision-making by a neutral third party.
c. Trade Union Representation: Support and negotiation by union representatives.
d. Grievance Procedure: Formal process for addressing employee complaints.
Guidelines for the Conduct of Good Management and Staff Relations in the Workplace
- Guidelines:
a. Good Communication: Open and transparent communication.
b. Improve Working Conditions: Enhancing workplace safety and comfort.
c. Motivating Workers: Encouraging employee engagement and productivity.
d. Practice Good Leadership: Effective leadership and management.

Strategies for Motivating Employees in a Business

- Strategies:
a. Financial Methods: Salary increases, bonuses, and benefits.
b. Non-Financial Methods: Recognition, autonomy, and opportunities for growth.

Role of Teamwork in the Success of an Organisation

- Teamwork:
- Definition: Collaborative effort towards a common goal.
- Advantages: Improved communication, increased productivity, and enhanced creativity.
- Disadvantages: Potential conflicts, communication breakdowns, and coordination
challenges.

Strategies for Effective Communication within an Organisation

- Strategies:
a. Clear and Concise Messaging: Avoiding ambiguity and ensuring understanding.
b. Regular Feedback: Encouraging open communication and feedback.
c. Multiple Communication Channels: Using various channels to reach different
audiences.

UNIT 3- ESTABLISHING A BUSINESS

- Entrepreneur: An individual who creates, organizes, and manages a business, taking on
financial risks in pursuit of profit.

Functions of an Entrepreneur
a. Conceptualising: Developing business ideas.
b. Planning: Creating business plans and strategies.
c. Accessing Funds: Securing financing for the business.
 d. Organising: Structuring and allocating resources.
e. Operating: Managing the day-to-day activities of the business.
f. Evaluating: Assessing business performance.
g. Risk Bearing: Taking on financial risks and responsibility for losses.

Characteristics of the Typical Entrepreneur:

a. Creative: Generating innovative ideas.
b. Innovative: Implementing new solutions and products.
c. Flexible: Adapting to changing circumstances.
d. Goal-Oriented: Focusing on achieving business objectives.
e. Persistent: Overcoming obstacles and challenges.
f. Persevering: Maintaining effort and motivation.
g. Propensity to Take Calculated Risks: Taking informed risks to achieve business goals.

4. Role of the Entrepreneur in the Decision-Making Process

a. Conceptualising: Developing business ideas.
b. Planning: Creating business plans and strategies.
c. Accessing Financing: Securing funding for the business.
d. Organising: Structuring and allocating resources.
e. Operating: Managing the business.
f. Evaluating: Assessing performance.
g. Risk Bearing: Managing financial risks.

Role of the Entrepreneur in Economic Development

a. Collaborating: Working with others to achieve business goals.
b. Providing Goods and Services: Meeting the needs of citizens.
c. Creating Jobs: Generating employment opportunities.
d. Contributing to Nation Building: Supporting economic growth and development.

Reasons Why an Individual May Want to Establish a Business

a. Desire for Financial Independence: Achieving financial freedom.
b. Self-Fulfillment: Pursuing personal passions and interests.
c. Self-Actualisation: Realizing personal potential.
d. Increased Income: Earning a higher income.
e. Increased Control of Working Life: Having autonomy and flexibility.
7. Steps That Should be Taken in Establishing a Business
a. Conceptualisation: Developing business ideas.
 b. Research: Conducting market research and analysis.
c. Identification of Resources: Securing financial, human, and material resources.
d. Creation of Business Plan: Developing a comprehensive business plan.
e. Acquisition of Funds: Securing financing for the business.
f. Operation of the Business: Launching and managing the business.

Reasons for Preparing a Business Plan

- Ensuring Feasibility: Conducting research and analysis.

- Attracting Investors: Showcasing the business opportunity.
- Sourcing Financing: Securing funding.
- Guiding Operations: Informing business decisions.

Elements of a Business Plan

a. Executive Summary: Overview of the business.
b. Operational Plan: Business objectives, structure, and operations.
c. Business Opportunity: Description of the product or service.
d. Marketing Plan: Market analysis and strategy.
e. Financial Forecast: Financial projections and planning.

Sources of Information for Conducting Research into the Establishment of Businesses

a. Primary Sources: Original data and research.
b. Secondary Sources: Existing research and data.

Significance of Conducting a Feasibility Study into the Establishing of a Business

a. Ascertaining Viability: Determining the potential success of the business.
b. Estimating Costs: Identifying potential costs and expenses.
c. Identifying Sources of Finance: Exploring funding options.
Relationship Between Planning and the Operation of a Business
a. Short-Term Planning: Focusing on immediate goals and objectives.
b. Medium-Term Planning: Developing strategies for the near future.
c. Long-Term Planning: Planning for sustained growth and success.
Regulatory Practices Instituted by Governments for the Establishment and Conduct of
Different Types of Businesses
a. Monetary and Fiscal Policies: Economic policies and regulations.
b. Consumer Protection Agencies: Protecting consumer rights.
c. Environmental Policies: Regulating environmental impact.

Factors That Determine the Location of a Business

a. Geographical: Location and accessibility.
b. Availability of Raw Materials and Supplies: Access to necessary resources.
c. Infrastructure: Quality of roads, transportation, and utilities.
d. Power and Water: Availability and reliability of essential services.
e. Telecommunications: Quality and accessibility of communication networks.
f. Transport: Availability and cost of transportation options.
g. Health Facilities: Access to medical care and emergency services.
h. Labour Supply: Availability and quality of workforce.
i. Governmental Regulation: Compliance with local laws and regulations.

Significance of Collateral in Accessing Capital to Establish a Business

- Collateral:
a. Concept: Assets used to secure loans or credit.
b. Types: Property, stocks, bonds, cash, life insurance policies, motor vehicles,
appliances.
c. Value: Collateral provides lenders with security, reducing risk and increasing access to
capital.

UNIT 4- LEGAL ASPECTS OF A BUSINESS

Contract: A legally binding agreement between two or more parties that outlines the terms
and conditions of a transaction or relationship.

Types of Contracts
a. Simple Contract: A verbal or written agreement that is enforceable by law.
b. Specialty Contract: A contract that is signed, sealed, and delivered, often used for
more formal agreements.

Characteristics of a Simple Contract

 a. Offer and Acceptance: One party makes an offer, and the other party accepts it.
b. Competence of Parties: Both parties must be legally competent to enter into a
contract.
c. Intention to Create Legal Relations: Both parties intend to create a legally binding
agreement.
d. Consideration: Both parties must provide something of value, such as payment or
services.

Characteristics of a Specialty Contract

a. Signed: The contract is signed by the parties involved.
b. Sealed: The contract is sealed, often with a wax seal or other formal mark.
c. Delivered: The contract is delivered to the other party.

5 Conditions Under Which Offer and Acceptance Are Communicated

1. Offer and Acceptance:
2. Written or Verbal: Offers and acceptances can be made in writing or verbally.
3. Clear and Definite: The terms of the offer and acceptance must be clear and definite.

Ways by Which Contracts May Be Terminated or Discharged

1. Performance: The contract is fulfilled according to its terms.
2. Breach: One party fails to fulfill their obligations.
3. Agreement: Both parties agree to terminate the contract.
4. Impossibility: The contract becomes impossible to fulfill due to unforeseen
circumstances.
5. Lapse of Time: The contract expires due to a specified time limit.
6. Death: The death of one party may terminate the contract.

Why Documentation Is Necessary in Business Transactions

Importance of Record Keeping:
1. Taxation: Accurate records are necessary for tax purposes.
2. Auditing: Records provide a clear audit trail.
3. Business Operations: Records help businesses track transactions and make informed
decisions.

Business Documents for Various Purposes

1. Pro Forma Invoices: Preliminary invoices that outline the terms of a transaction.
 2. Purchase Requisitions: Documents that request the purchase of goods or services.
3. Statements of Accounts: Documents that outline the status of an account.
4. Stock Cards: Documents that track inventory levels and movement.

Principles Upon Which Insurance Is Based

- Principles:
1. Pooling of Risks: Spreading risk among a large group of people or businesses.
2. Subrogation: The insurer's right to pursue a third party for damages.
3. Proximate Cause: The primary cause of a loss or damage.
4. Indemnity: Compensation for losses or damages.
5. Utmost Good Faith: The requirement for honesty and transparency in insurance
contracts.
6. Contribution: The sharing of losses among multiple insurers.
7. Insurable Interest: The requirement that the insured have a financial interest in the
insured asset.
Various Types of Insurance Policies
1. Life Insurance: Providing financial protection for dependents in the event of death.
2. Non-Life Insurance: Covering risks such as property damage, liability, and health.

How Insurance Facilitates Trade

- Value of Insurance:
1. Lowering Risks: Insurance coverage reduces the financial risks associated with
business.
2. Increasing Confidence: Insurance provides peace of mind, allowing businesses to
operate with more confidence.
3. Protecting Assets: Insurance helps protect businesses from financial losses due to
unforeseen events.
4. Facilitating Credit: Insurance coverage can be required for businesses to access
credit or loans.