Business AdministrationBusiness AdministrationIng. Kateřina Maršíková, Ph.D.Ing. Kateřina Maršíková, Ph.D.

Department of Business AdministrationDepartment of Business AdministrationFaculty of EconomicsFaculty of Economics

katerina.marsikova@tul.czphone: +420 48535 2344phone: +420 48535 2344

Literature - sourcesLiterature - sources

Lectures – ppt presentations Lectures – ppt presentations

- Multiedu.tul.cz- Multiedu.tul.cz

- Rydvalová, P., Maršíková, K. Small and - Rydvalová, P., Maršíková, K. Small and Medium EnterprisesMedium Enterprises

- Introduction to Business - Introduction to Business

Subject requirementsSubject requirements

Semestr –creditsSemestr –credits- Semestr project (25 points)Semestr project (25 points)- Activity during the semestr (5 points)Activity during the semestr (5 points)- AttandanceAttandance

ExamExam – written exam 70 points – written exam 70 points

Form of the ProjectForm of the Project Written in MS Word – up to 10 pagesWritten in MS Word – up to 10 pages Title list – Name, title of the project, date, countryTitle list – Name, title of the project, date, country Content, pages numberingContent, pages numbering Literature – resources – Harward style of citationLiterature – resources – Harward style of citation Theoretical partTheoretical part Practical partPractical part Conclusion Conclusion

Business environmentBusiness environment

GeographicalGeographical SocialSocial Political and legalPolitical and legal EconomicEconomic EcologicalEcological TechnologicalTechnological EthicEthic CulturalCultural

What means „What means „ECONOMICECONOMIC““

Availability and prices of factors of productionAvailability and prices of factors of production (resources, which are used to produce goods (resources, which are used to produce goods and services)and services)

Tax burden of enterprisesTax burden of enterprises

Economic growth, monetary conditionsEconomic growth, monetary conditions

(macroeconomic growth, inflation, exchange rate, (macroeconomic growth, inflation, exchange rate, purchasing power of customers)purchasing power of customers)

Customers, suppliers, financial institutionsCustomers, suppliers, financial institutions

Do you know? Do you know?

Income tax of your country (PIT, CIT)? Income tax of your country (PIT, CIT)? - Natural person x legal entity- body Natural person x legal entity- body

(companies)(companies)- InflantionInflantion- UnemploymentUnemployment- Value Added TaxValue Added Tax- Average gross salary (wage)?Average gross salary (wage)?

ECONOMICSECONOMICS

Economics – a science concerned with law Economics – a science concerned with law governing the economic life of siciety.governing the economic life of siciety.

- To meet human wants and needs with limited To meet human wants and needs with limited sources.sources.

- How, what and for whom.How, what and for whom.

EconomyEconomy

Complex of activities and subjects (firms, Complex of activities and subjects (firms, companies, state, individuals) concerned with companies, state, individuals) concerned with the production, distribution, exchange and the production, distribution, exchange and consumption of goods within a certain area.consumption of goods within a certain area.

Basic types of economiesBasic types of economies

Command economyCommand economy (centrally planned) (centrally planned)

- Economic decision are made by goverment- Economic decision are made by goverment Shortage x unsaleable commoditiesShortage x unsaleable commodities

- It was typical for socialist countries - It was typical for socialist countries

(Free market economy)(Free market economy) Law of supply and demandLaw of supply and demand ProfitabilityProfitability

P D

S

E

Q

Supply Supply – the goods being sold– the goods being sold

DemandDemand – the interest of the buyers to – the interest of the buyers to purchase the commodities offeredpurchase the commodities offered

Market priceMarket price – a figure determined by the – a figure determined by the relation between the supply and the demandrelation between the supply and the demand

Equilibrium Equilibrium – point of intersection between – point of intersection between supply and demansupply and deman

CompetionCompetion – creates an inseparable conditions – creates an inseparable conditions for the existence of any marketfor the existence of any market

Mixed economyMixed economy

Combines certain featues of pure market and Combines certain featues of pure market and command economic systemscommand economic systems

Part of the production is governed by market Part of the production is governed by market laws, some firms are publicly ownedlaws, some firms are publicly owned

Transition economyTransition economy

Economy which are in the phase of transition Economy which are in the phase of transition from planned economy to an open-market from planned economy to an open-market systemsystem

Government stops interventing in many Government stops interventing in many spheres of country´s lifespheres of country´s life

Restitution, privatization, liberalization of Restitution, privatization, liberalization of prices etc.prices etc.

What is a market?What is a market?

An economic area specializing in the exchange An economic area specializing in the exchange of activities through an exchange of goods.of activities through an exchange of goods.

Sellers x buyers Sellers x buyers interaction (influence of interaction (influence of prices and quantities)prices and quantities)

Market functionsMarket functions

Gives the answer – what, how and for Gives the answer – what, how and for whom to producewhom to produce

Helps to allocate scare resourcesHelps to allocate scare resources

Types of marketTypes of market

Market of products and servises.Market of products and servises.

Market of factors of production (land, Market of factors of production (land, capital goods and labour markets).capital goods and labour markets).

Financial markets (money and capital Financial markets (money and capital market).market).

CompetionCompetion

Contest in the market by legal means: Contest in the market by legal means: - Lower production costsLower production costs- Higher qualityHigher quality- Sale promotionSale promotion

- Competion has a positive impact, e.g. Quality Competion has a positive impact, e.g. Quality improvements,upgrading of technical improvements,upgrading of technical paremetersparemeters

Perfect competitionPerfect competition

- market situation, where there exists a - market situation, where there exists a large numbers of sellers and buyerslarge numbers of sellers and buyers

Products are close substitutes and are Products are close substitutes and are replaceablereplaceable

No single firm is able to dominate the No single firm is able to dominate the marketmarket

Imperfect competitionImperfect competition

At least one competitor is big and strong At least one competitor is big and strong enough to influence the market priceenough to influence the market price

- Cost advantage – lower pricesCost advantage – lower prices- Barriers to competition – trademark, brand Barriers to competition – trademark, brand

namename- Insufficient information Insufficient information - Administrative measuers, government Administrative measuers, government

directivesdirectives

MonopolyMonopoly

Oposite of perfect competitionOposite of perfect competition Only one producer with various advantages Only one producer with various advantages

from such a positionfrom such a position

Monopoly power – to fix a price above the Monopoly power – to fix a price above the marginal costsmarginal costs

MonopsonyMonopsony

Market with only one buyerMarket with only one buyer

The buyer has ability to influence the market The buyer has ability to influence the market priceprice

Monopolistic competitionMonopolistic competition

Market with many producersMarket with many producers

Their product are differentiated – each of them Their product are differentiated – each of them can set their own prices and their production is can set their own prices and their production is kind of monopolykind of monopoly

TenderTender

Specific form of open competitionSpecific form of open competition Partners in tender submit proposal for contract Partners in tender submit proposal for contract

on certain productson certain products The purpose of tender is to obtain a larger The purpose of tender is to obtain a larger

number of offers and the most suitable is number of offers and the most suitable is selected selected

Trust and cartelsTrust and cartels

Sometimes serious distortion of perfect Sometimes serious distortion of perfect competitioncompetition

Based on Based on agreement agreement with the aim of gaining with the aim of gaining competitive advantage over non-memberscompetitive advantage over non-members

OPEC- cartel dictating oil pricesOPEC- cartel dictating oil prices

Enterprise, its objectiveEnterprise, its objectivess and functions and functions

What is business?What is business?- all the work involved in providing people with goods and - all the work involved in providing people with goods and

services for a profitservices for a profit

ProfitProfit- is the money left over from all sums received from sales is the money left over from all sums received from sales

after expenses, which have been deductedafter expenses, which have been deducted

EnterpriseEnterprise- an independent subject, founded usually by entrepreneur on - an independent subject, founded usually by entrepreneur on

purpose to achieve some profit, which is usually the main purpose to achieve some profit, which is usually the main objective of businessobjective of business