Basic principles of business. Or, What are the basic principles of business?

Basic principles of business.

Or, What are the basic principles of business?

 

Business follows several distinctive principles. Those are-

1. Specific objective.
2. Perfect organization structure.
3. Proper planning.
4. Optimum location.
5. Optimum size.
6. Good location.
7. Financial solvency.
8. Risk bearing capacity.
9. Good human relation.
10. Efficient management.

Now short description of these principles is given below-

1. Specific objectives:

            Each and every business Should have specific objectives. Because if business does not possess specific objectives then it will not be successful.

2. Perfect organization structure:

            Organization combines various activities, employees and departments. That is why business must have a perfect organization structure.

3. Proper planning:

            Planning is an important function of business, so to be successful and profitable business must be well planned.

4. Optimum capital:

            The major factor of production is capital. No business activity can run without capital. So to manage optimum capital is an important principle of business.

5. Optimum size:

            Determining optimum size for the business is another principle of business. Because the success of business largely depend on its optimum size.

6. Good location:

            To find out a proper location is essential for business. Business location should be selected by considering present conditions and forecasting future situations.

7. Financial solvency:

            Each and every business takes the principle of financial solvency. Because the business which have not enough solvency cannot operate business actives effectively.

8. Risk bearing capacity:

            All business involves risk and uncertainty. Because no risk no gain. That is why more risk brings more profit.

9. Good human relation:

            The overall success of business depends on good human relation. That means there should a good relation among various parties involved in the business.

10. Efficient management:

            Efficiency is the fuel of success. The success of any business depends on efficient management.

            These are the important principles of business.