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Contribution and Application of Business Economics To Business

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Tanay shukla
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49 views

Contribution and Application of Business Economics To Business

Uploaded by

Tanay shukla
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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CONTRIBUTION AND APPLICATION OF

BUSINESS ECONOMICS TO BUSINESS


CONTENT :

 BASIS IDEA ABOUT ECONOMICS AND BUSINESS ECONOMICS.


 DIFFERENTIATION BETWEEN BUSINESS AND BUSINESS ECONOMICS.
 APPLICATION OF BUSINESS ECONOMICS:
1. BUSINESS GROWTH
2. BEAT COMPITIONS
3. DEMAND ANALYSIS AND FORECASTING
4. COST ANALYSIS
5. ADVERTISING OR PROMOTION OF PRODUCT
6. INVENORY MANAGEMENT
7. DETERMINING PRICE
BASIS IDEA ABOUT ECONOMICS
AND BUSINESS ECONOMICS:
 ECONOMICS  BUSINESS
1. IT IS HE STUDY OF SOCIAL ECONOMICS
SCIENCE HICH HELPS IN
1. IT IS APPLICATION OF
STUDING HUMAN BEHAVIOUR
ECONOMIC THEORY AND LAWS
{ WANTS ARE UNLIMITED AND
IN THE FIELD OF BUSINESS
RESOURCES ARE LIMITED }
2. IT IS A PRACTICAL CONCEPT
2. IT IS THEORICITAL CONCEPT
3. IT STUDIES ONLY MICRO
3. IT STUDIES BOTH MACRO AND
ECONOMICS
MICRO ECONOMICS
4. IT HAS ONLY NORMATIVE
4. IT IS BOTH POSITIVE AND
CONCEPT
NORMATIVE CONCEPT
NOTE:

POSITIVE ECONOMICS :
IT DEALS WITH FACT AND ALSO CAN BE VARIFIED.

EXAMPLE: INDIASPOPULATION IS INCREASING

NORMATIVE ECONOMICS :

IT IS BASED ON OPINIONS / SUGGESTION AND IT CANNOT BE VARIFIED.

EXAMPLE: INDIA POPULATION SHOULD DECREASE.


DIFFERENTIATION BETWEEN
BUSINESS AND BUSINESS
 ECONOMICS:
BUSINESS 
BUSINESS ECONOMICS
1. IT IS AN ACTIVITY WHICH IS 1. APPLICATION OF ECONOMIC
DONE WITH AN OBJECTIVE OF THEORY AND LAWS IN FILED OF
MAKING PROFIT BY BUYING AND BUSINESS
SELLING GOODS AND SERVICE
CONTRIBUTION AND APPLICATION OF BUSINESS
ECONOMICS TO BUSINESS
BUSINESS GOWTH:

 BUSINESS GROWTH MEANS TO EXPAND A BUSINESS BY:


1. INCREASING SALES OF PRODCT
2. LAUNCHING NEW PRODUCT
3. EXPLORING NEW MARKET
4. OPENING NEW BRANCHES

HENCE BUSINESS ECONOMICS HELPS IN BUSINESS GROWTH.


BEAT COMPETITION:

 IT INCLUDES RESEARCH AND ANALYSIS OF COMPETATIVE FIRMS.


 HELPS IN SURVIVING AND BEATING THE COMPETITION.

HENCE BUSINESS ECONOMICS HELPS IN BEATING COMPETITION.


DEMAND ANANLYSING AND
FORECASTING:
 Demand analysis involves understanding the customer demand for a product or service in a particular
market
EXAMPLE: when the price is very high, a low-income buyer may not buy anything, though a high income
buyer may buy something.
 Demand forecasting is the process of predicting future sales by using historical sales data to make
informed business decisions about everything from inventory planning to running flash sales
EXAMPLE: suppose we sold 200, 250, 300 units of product X in the month of January, February, and March
respectively. Now we can say that there will be a demand for 250 units approx. of product X in the month of
April, if the market condition remains the same
COST ANALYSIS:

 IT IS THE STUDY OF COST OF THE PRODUCT WHICH HELPS IN


BUSINESS TO MINIMSE THE COST SO THAT PROFIT MARGIN CAN BE
INCREASED.

EXAMPLE: BOOTSTRAPING FOR STARTUP


Bootstrapping is the process of building a business from scratch without attracting
investment or with minimal external capital. It is a way to finance small businesses
by purchasing and using resources at the owner's expense, without sharing equity
or borrowing huge sums of money from banks.
ADVERTISING OR PROMOTION OF
A PRODUCT:
 BUSINESS ECONOMICS HELPS IN PLANNING ADVERTISING STRATEGY BY KEEPING
ADVERTISEMENT COST IN MIND.
Promotion include giving out coupons or vouchers, temporarily reducing prices through discounts, sampling,
offering giveaways, flash sales or buy-one-get-one-free offers, and lots more.
Advertising is the paid communication of firms and other organizations directed towards consumers and the broad
society. TV and radio spots, billboards, paid spaces in the press and other means are used to vehicle key messages
about products, brands, brand values, and identities.
INVENTORY MANAGEMENT:
 MANAGING STOCK OF RAW MATERIAL WHICH A COMPANY KEEPS .

 IF INVENTORY LEVEL IS LOW CUSTOMER WILL BE DISSATISFIED .

 IF INVENTORY LEVEL IS HIH THEN IT LEAD TO DAMAGE OF PRODUCT OR BLOCKAGE OF FUNDS.

EXAMPLE:
A soap manufacturer has already created a batch of soaps to dispatch to different points of sale. Given the high
consumption of soaps, it reorders raw materials to start manufacturing the next lot.
Raw materials ordered beforehand, in this case, act as the inventory for the company. And the already delivered finished
products are the inventory for retail units that will be selling soaps further.
Pre-ordering raw materials helps the company produce and supply soaps regularly to ensure the lead time does not keep
customers waiting or making them switch to its competitor’s soap.
DETERMINING PRICE:
 SUCCESS OF THE BUSINESS DEPENDS UPON HOW CORRECTLY PRICE OF A PRODUCT
DETERMINE
 IF PRCE INCREASES THEN DEMAND WILL DECREASE AND WHEN THE PRICE IS LOW THE
DEMAN WILL INCREASE
THANKS FOR YOUR PRECIOUS
TIME

PRESENTATION BY :
TARISHI
NANDINI

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