TYPES OF SECTORS - A nation's economy can be divided into various sectors to define the proportion of the population engaged

in the activity sector. The sectors are: 1) Primary sector- extracts or harvests products from earth. Includes production of raw materials and basic foods. In developed and developing countries, a decreasing number of workers are involved in the primary sector. Activities include: agriculture, mining, hunting, fishing and farming. 2) Secondary sector - manufactures finished goods. Includes all the manufacturing, processing and construction. Activities include: automobile production, engineering, construction, ship building and textile production. 3) Tertiary Sector- is the service industry which provides services to general population and businesses. In developed and developing countries, an increasing number of workers are involved in the tertiary sector. Activities include: restaurants, banking, insurance, tourism and law. 4) Quaternary Sector- consists of intellectual activities. Activities include: culture, library, scientific, research and education. A part of quaternary sector is quinary sector. This sector includes highest levels of decision making and activities include: universities, healthcare and media. 5) Public sector - Also known as state sector. It is a part of the state which deals with either the production or delivery of goods and services by the government. Activities include: health, defence, social security, pubic law and transportation. 6) Private sector- Also known as citizen sector. owned and controlled by individuals or groups of individuals. The main types of businesses in private sector include: - Sole trader - Partnership - Private limited company - with limited liability and private shares - Public limited company - shares are open to public - Franchise - business owner pays a corporation to use their name. - Workers cooperative - all workers have equal pay and make joint decisions. 7) Social / Voluntary sector - A non-profit, non-government sector. Includes NGOs & charitable organisations. TYPES OF OWNERSHIPS 1) Sole proprietorship - Business owned and run by an individual. small business employing 50 people. Advantages: - quick decision making - easy to start - complete control of business - freedom from strict government rules - all profit goes to owner Disadvantages: - sources of funds depend on owner's financial condition - few sources of finance like bank. - unlimited liability- responsible for all debts

- business dies with illness or death of owner - difficult to match the challenges of big corporations 2) Partnership - an association of 2 or more persons to carry on a business to make profit. There are 3 types of partnership: - General partnership- Complete sharing of management by partners - Limited partnership - One general partner who assumes unlimited liability and management responsibility and one limited partner who liability is limited to his investment and doesn't participate in the firm's management. - Joint venture - Partnerships of individuals or organisation established to provide a service or product or for a limited time. Advantages - different partners will specialise in different areas of management - shared decision making - greater privacy - various sources of finance from all partners and banks - fewer government policies Disadvantages - clash of culture and goals between partners - profit sharing - limited sources of income - no share selling - unlimited liability - all partners are bound to decision of one partner 3) Corporations - legal entities whose assets and liabilities are separate from its owners. They are major source of revenue for an economy. Owners or stockholders are entitled to all profits that are left after all the corporation expenses are paid off. Provides large source of employment. There are four types of corporations. - Private or close corporation- owned by one or few people who are closely involved in the business - Public or Open corporation- the shares can be bought and sold by anyone in public ( A private firm may go public by selling its stock to public OR a public firm may go private if one or few individuals purchase all the firm's shares. ) - Quasi public- Business that is important to society but fails to attract investors. It is operated by the state or local government. (eg: cultural society) - Non-profit- focus is on providing service rather than earning profit. Advantages - As it is a separate legal entity; stockholders are not individually responsible for the result (eg: losses) - Stockholders can transfer shares to others - Life of corporations is forever - Funds are easily available so no difficulty in expansion - If company is sued- the company goes to the court not the owner. Disadvantages - Initial investment is high - Under strict government rules. Must follow all regulations - Employees are not stockholders so may feel ignored - Charter restriction: can't operate beyond the business is has stated in the charter. 4) Limited Liability Company (LLC) - The ownerships of companies is divided into small units called shares. people buy these shares and become shareholders. There are two types of LLC: Partnership and corporate.

Advantages - Advantage of partnership LLC- Lower tax rate - Advantage of corporate LLC- Limited Liability - High status in the market - Legal personality - Continuity - Raise capital by selling shares. Disadvantages - disadvantage of corporate LLC- high tax rate - disadvantage of partnership LLC- Unlimited liability - Expensive to set up - Legal formalities TYPES OF ECONOMIES 1) Command economy- Government control all production and pricing (EG. Saudi Arabia, Cuba) - Government is totally involved. They tell you: what to produce, how much to produce, where to produce, who can buy and how much to charge. Advantage: You help the government, they help you. Disadvantage: You're limited. Features of common economy - Cooperation - working towards a common goal. - Collectivisation - the idea is that collectively you are stronger. - Public ownership of property- State ownership of all property allows for control of resources including human labour. - Equality - All members should have the same opportunity to share in the wealth and produce of land. - Central planning - A group of economic experts study the economy and recumbent production needs to the government body. 2) Mixed economy - This means there is some private business activity and some state owned and controlled organisations. (EG. North Korea, India) - Many products products and services are provided only by private businesses such as cars and computers. - Most essential services (such as police, fire service and defence) is provided by the state but in some countries it is provided by private business. - Many goods and services that benefit society are provided both by the state and private businesses (education and health) Advantage: You help the government, the government helps you. Increase in production and efficiency. 3) Traditional economy - found in rural, non-developed countries. (EG. parts of Asia, Africa, Middle East) - Traditions and customs govern the economic decisions that are made. - Technology is not used in traditional economies. - Economic activities are usually centred towards the family. - Men and women are given different economic roles. Advantages: -roles of individuals are clearly defined Disadvantages: -These societies are often very slow to change and when new technologies are introduced, these ideas and techniques are discouraged.

4) Capitalism OR Market Economy - In which individuals own and operate the majority of the businesses that provide goods and services. (EG. USA and Taiwan) - Government is not involved in benefits or drawbacks. Advantages: - Competition between different firms leads to increased efficiency - Can adjust to market changes. - Demands are met easily Disadvantages - Over production - Unemployment - High property tax - Too much foreign goods MARKETING MANAGEMENT Marketing is the management process that identifies, anticipates and satisfies customer requirements profitably - Evolution of marketing concept 1) Production Concept - Consumers will prefer products that are widely available and inexpensive - Consumers are more interested to have the product than its features - Used by marketers offering mass products. 2) Product Concept - Consumers will favor those products that offer most quality, performance or innovative features - Marketing Myopia- Too focused about the product features rather than the product itself 3) Selling Concept - The idea in marketing that if customers are left to themselves, they will not make the effort to buy a company's products. Therefore, it dictates, companies must be aggressive in pushing their sales. 4) Marketing Concept - The key to achieving its organizational goals consists of the company being more effective than competitors in creating and delivering the customers needs and wants.

- Marketing Mix - combination of elements that are needed to market a product. There are 8 elements (known as the 8 P's) 1) Pricing strategies - Pricing is the only mix which generates a turnover for the organisation. - Penetration pricing- used to obtain high volumes by selling product at low prices. Suitable for products with long anticipated life cycles. May be useful if launching into a new market. Typical in mass market products such as chocolate bars, food stuffs, household goods, etc. - Market Skimming - sold at high prices and but less volumes are sold. The objective is to earn high profits. The prices are lowered after the objective is met. Suitable for products that have short life cycles or which will face competition in the future. Examples include: Playstation, jewellery, digital technology. - Value Pricing - Price set in accordance with customer perceptions about the value of the product/service

- Psychological Pricing - Used to play on consumer perceptions. Example - 9.99 instead of 10.99! - Bundle pricing- The act of placing several products or services together in a single package and selling for a lower price than would be charged if the items were sold separately - Competition pricing - is a price set by a company for a product to compete with another company's pricing - Production line pricing - The process used by retailers of separating goods into cost categories in order to create various quality levels in the minds of consumers. 2) Promotion - A successful product or service means nothing unless the benefit of such a product/service can be communicated clearly to the target market. Ways of communicating: - Advertising- The activity of producing information for promoting the sale of products or services. - Public Relations - is the practice of managing the flow of information between an organization and its publics - Sales promotion - initiative undertaken by an organisation to promote an increase in sales of product/service - personal selling - Face-to-face selling in which a seller attempts to persuade a buyer to make a purchase. - Direct mail -A marketing effort that uses a mail service to deliver a promotional printed piece to the target audience. - Internet/E-commerce - Selling goods/services on the internet. 3) Place - The means by which products and services get from producer _to consumer and where they can be accessed by the consumer. The more places to buy the product and the easier it is made to buy it, the better for the business (and the consumer) - Retail - Selling goods in small quantities directly to consumer - Wholesale - Selling goods in large quantities at low prices. - Mail order - Method of selling in which buyers and sellers do not make face-to-face contact. - Internet - selling goods or services on the internet. - Direct Sales - Face to face presentation, demonstration, and sale of products or services, usually at the home or office - Peer to peer - Multi-channel - The use of many different types of marketing, such as web sites, catalogs, telephone calls, mail, and television advertisements in order to attract customers. 4) People - The image they present can be important Extent of training and knowledge of the product/service concerned - Employees - How they show the image of the business - Management - How the business is run. - Culture - What culture is portrayed. - Customer service - How the company deals with its customers' needs and problems. 5) Process - the process of giving a service, and the behaviour of those who deliver are important to customer satisfaction. Issues such as waiting times, the information given to customers and the helpfulness of staff are all vital to keep customers happy. Where do they find the availability _of the service? -Contact -Reminders -Registration -Subscription

-Form filling -Degree of technology 6) Physical Environment- this refers to whatever your customers can see before purchasing. Customers make judgements based on the environment. How clean and organised the environment is. What facilities are provided. 7) Products - Can be classified into Industrial goods and Consumer goods. a) Industrial goods - Products designed for use by another business -Purchased in large quantity -Made for Special Order and specific customer -Sold to selected group of buyers located in a specific area -Examples : aluminum purchased by aircraft manufacturer; -construction materials ; machinery etc b) Consumer goods - Products designed for personal or home use. - Consumer Goods can be classified on the basis of : How important the product is to the consumer Whether the customer is willing to spend time and money to compare products and brands before taking the decision - Examples: Jewelry , furniture ,soft drinks , etc Types of consumer goods. - Convenience good- Inexpensive items of regular use Competing products dont differ much from each other so the marketers need to sell them through many outlets that are conveniently located Eg. Milk, Candies, Soft drinks,soaps,oil etc - Shopping goods- Consumers purchase less frequently Usually have higher price and require some buying thought Differentiated on the basis of Price and Features. Eg. Cars , Furniture and Houses. -Special/Luxury goods - Products that customers insist upon having and are willing to search for until they find them. Found at fewer places and Marketers charge higher price. Eg. Designer Clothes , Expensive Jewelry, Customized products( shoes etc) ,Limited edition, certain automobiles etc 8) Packaging- Role of packaging is broadening to attract attention of customers so that they buy.