1.1 WHAT IS BUSINESS
https://en.wikipedia.org/wiki/BusinessBUSINESS is the activity of making one’s life or making money by producing or buying and selling products (goods and services). In short, it is “any activity or enterprise it enters into profit, does not mean it is a company, a company, a partnership, or an official organization, but it can ranging from street vendors to General Motors. “The term is also often used colloquially (but not by lawyer or public officer) to refer to a company, but this article will not control the word.
• Anyone who engages in activities that earn their profit is doing business or doing business, and this is probably why there is a misconception that businesses and companies are the same.
• The business name structure does not separate the business entity from the owner, which means that the business owner is responsible and responsible for all debts incurred by the business. If a business receives a debt, the creditor may pursue the owner’s personal property. The business structure does not allow corporate tax rates. The owner is personally charged on all income from the business.
• A company on the other hand, is a separate legal entity and provides limited liability and corporate tax rates. The structure of the company is more complex and expensive to set up, but offers more protection and benefits for its owners.
Forms of business ownership vary by jurisdiction, but several common entities exist:
• Single proprietorship: The sole proprietor, also known as a single trader, is owned by a person and operates for his benefit. Owners handle the business themselves and can hire employees. The sole proprietor has an unlimited liability for all liabilities incurred by the business, whether from operating costs or business judgment. All business assets belong to a sole proprietor, including, for example, computer infrastructure, any inventory, manufacturing equipment, or retail fixtures, as well as any real estate owned by a sole proprietor.
• Partnership: Sharing is a business owned by two or more people. In most forms of partnership, each partner has unlimited liability for the debt incurred by the business. The three most common types of profit sharing are: general partnership, limited partnership, and limited liability partnership.
• Corporation: The owner of the corporation has limited liability and the business has the legal personality separate from its owner. Corporations may either belong to the government or privately owned. They can suggest either for profit or as a non-profit organization. Corporations for private-owned companies are owned by its shareholders, who choose the board to direct the corporation and employ its management staff. Corporations for private gain can either be privately held by a small group of individuals, or held openly, with public listed shares listed on the stock exchange.
• Co-operative: Often referred to as “co-op”, the cooperative is a restricted business-liability that can comprise profit or not for profit. Cooperatives differ from corporations as they have members, not shareholders, and they share decision-making powers. Cooperatives are usually classified as consumer cooperatives or workers’ cooperatives. Cooperatives are the basis of the ideology of economic democracy.
• Franchise: A franchise is a system where entrepreneurs buy the right to open and run businesses from a larger company. Franchises in the United States are widespread and are the main economic power. One in twelve retail businesses in the United States is a franchise and 8 million people work in a franchise business.
• A limited company by guarantee: Usually used where companies are formed for non-commercial purposes, such as clubs or charities. Members guarantee payment of a certain amount (usually nominal) if the company enters into an insolvable liquidation, but otherwise they have no economic rights in relation to the company. This type of company is commonplace in England. A company limited by guarantee may or may not have capital stock.
• A limited company by shares: The most common form of company used for business ventures. In particular, a limited company is a “company in which each shareholder’s liability is limited to an individual invested amount” with companies being “the most common example of a limited company. “These types of companies are common in England and many English-speaking countries. A company limited by shares can be a publicly traded companies or a private company.
• A company limited by guarantee with share capital: Hybrid entities, usually used where companies are formed for non-commercial purposes, but the company’s activities are partly funded by investors who expect returns. This type of company may no longer be established in the UK, though the provisions are still in the law for them to exist.
• A limited liability company: “A legally legalized company in certain states – characterized by limited liability, management by members or managers, and restrictions on transfer of ownership”, ie, L.L.C. The structure of the LLC has been called “hybrid” as it “combines the characteristics of a company and the partnership or the sole proprietorship”. Like a corporation, it has limited liability for the members of the company, and such partnership has “tax inflow to members” and must be “dissolved upon death or bankruptcy of members”.
• An unlimited company with or without share capital: Hybrid entity, a company in which the member liability or shareholder for debt (if any) of the company is unlimited. In this case the veil of doctrine of establishment is unused.
Less common types of companies are:
• Companies formed by patents. Most companies with patents are single and non-company companies such as the term commonly understood today.
• Charter company. Before passing the laws of modern companies, this is the only type of company. Nowadays, they are quite rare, except the old surviving companies (many, especially British banks), or modern society that fulfill quasi-regulatory functions (for example, the Bank of England is a company formed by modern charter).
• Statutory company. On this day quite rarely, certain companies have been formed by approved private law in the relevant jurisdictions.
In legal terms, company owners are usually referred to as “experts”. In a company limited or unrestricted by shares (formed or combined with share capital), this will become a shareholder. In a limited company with a guarantee, this will be the guarantor. Several offshore jurisdictions have created a special form of offshore companies in an effort to attract businesses to their jurisdiction. Examples include “isolated portfolio companies” and limited-purpose companies.
However, there are many sub-categories of companies that can be formed in various jurisdictions in the world.
Companies are sometimes distinguished for legal and regulatory purposes between public and private companies. Public companies are companies whose shares can be traded publicly, often (though not always) on the stock market that impose listing / Listing Requirements on issued shares, stock trading and future stock issues to help improve the exchange reputation or specific exchange market . Private companies do not have public shares traded, and often contain restrictions on the transfer of shares. In some jurisdictions, private companies have the maximum number of shareholders.
A parent company is a company that has enough stock in another firm to control management and operations by influencing or electing its board of directors; the second company is deemed to be the holding company of the parent company. The definition of a parent company differs from jurisdiction, with its definition usually defined by the law dealing with companies in that jurisdiction.
WHAT IS THE OBJECTIVE OF BUSINESS?
https://www.tutor2u.net/business/reference/aims-and-objectives-of-a-businessThe objective of providing a clear target business. Plans can be made to achieve this goal. This can motivate the employees. It also allows businesses to measure progress towards the stated objectives.
The most effective business objectives meet the following criteria:
S – Specific – objective is addressed to what the business does, e.g. a hotel may have the objective of filling 60% of its night’s sleep in October, the specific objective of the business.
M – Measurable – businesses can value the goal, for example. € 10,000 in sales in the coming half of trading.
A – Agreed on all parties involved in the pursuit of these objectives.
R – Realistic – objective must be challenging, but it should also be accessible to available resources.
T – Time Specific – they have a time limit when objectives have to be achieved, eg. at the end of the year.
The main business objectives that may exist are:
Survival – short-term objectives, perhaps for new small businesses are beginning, or when new firms enter the market or in times of crisis.
Profit Maximisation – try to make the most profit possible – most likely to be the destination of the owner and shareholder.
Profit satisficing – try to make enough profit to make sure the owner is comfortable – perhaps the purpose of a small business whose owner does not want to work longer.
Sales growth – where businesses try to make as much sales as possible. This may be because managers believe that business continuity depends on the large. Large businesses can also benefit from economies of scale.
A business may find that some of their objectives conflict with one and other:
Growth versus profit: for example, achieving higher sales in the short term (eg by reducing prices) will reduce short-term profit.
Short-term vs. long-term: for example, businesses may decide to accept lower cash flows in the short term while they invest heavily in new products or plants and equipment.
Large investors on the Stock Exchange are often accused of seeking too much on the short term objective and performance of the company from investing in the long-term business.
Alternative Aims and Objectives
Not all businesses seek profit or growth. Some organisations have alternative objectives.
Examples of other objectives:
Ethical and social responsibility objectives – organizations such as Co-op or Body Shop have an objective based on their beliefs about how one should treat the environment and the less fortunate.
Public sector corporations not only generate profit but provide services to the public. This service needs to meet the poorer needs of the community or help improve the functional capability of the economy: e.g. cheap and accessible transport services.
Public sector organizations that monitor or control private sector activities have the objective of ensuring that the businesses they monitor are in compliance with the prescribed laws.
Healthcare and education organizations – their goal is to provide services – most private schools such as having a status of charity. Their goal is to increase their students through education.
Charitable and voluntary bodies – their goals and objectives are led by the trust they have.
Businesses may change their objectives over time due to the following reasons:
Businesses may achieve goals and need to move in the other direction (for example surviving in the first year can lead to an increase in profitability in the second year).
Competitive environment may change, with the launch of new products from competitors.
Technology may change the product design, so sales and production targets may need to be changed.
Thus, the objectives of business may be classified as:
Business economic objectives refer to the objective of earned profit as well as other objectives that need to be taken to achieve profit goals, including, customer creation, fixed innovation and the best use of resources available.
(i) Profit Revenue:
Profit is a business venture, without a business that can not survive in a competitive market. Actually making profit is the primary goal of which a business unit is created. Profits should be earned to ensure continuity of business, growth and development over time.
Profits help businessmen not only to earn their income but also to expand their business activities by reinvesting some of the profits. To achieve this ultimate goal, some other objectives should also be carried out by the business, as follows:
(a) Customer creation:
Business units can not survive unless there are customers to buy products and services. Again a businessman can profit only when he provides quality goods and services at an affordable price. Therefore, it is necessary to attract more customers for existing products as well as new products. This is achieved with the help of various marketing activities.
(b) Fixed innovation:
Innovation means change, which leads to an increase in product, production process and distribution of goods. Business units, through innovation, are able to reduce costs by adopting better production methods and also increasing their sales by attracting more customers due to better products.
Cost reduction and increase in sales give businessmen more profits. The use of power woven in hand, the use of tractors in hand tools in farms etc is all innovative.
(c) Best resource use:
As we know, to run our business must have sufficient capital or funds. Total capital can be used to buy machinery, raw materials, hire men and have cash to meet daily expenses. Therefore, business activities require various sources such as men, materials, money and machines.
The availability of these resources is usually limited. Therefore, every business should strive to utilize these resources. Using an efficient worker. Fully using machines and minimizing wastage of raw materials can achieve this goal.
Social objectives are business objectives, which are required to be achieved for the benefit of society. As businesses operate within society using limited resources, the community expects something in return for its welfare. There is no business activity that should be aimed at giving problems to the community.
If business activity leads to harmful social consequences, it will definitely be a public reaction to the business sooner or later. The social business objectives include the production and supply of quality goods and services, the use of fair trade practices and contributions to the general welfare of the community and the provision of welfare facilities.
(i) Production and Supply of Goods and Quality Services:
Because the business uses a variety of community resources, the community expects to get quality goods and services from businesses whose business goals should produce quality goods and supply them at the right time and at the right price It is not desirable for business people to supply forged or insufficient entry to cause injury to customers.
They need to charge the price according to the quality of the goods and services provided to the community. Again, customers also expect the supply of all their needs in a timely manner. It is therefore important for every business to supply goods and services on a regular basis.
(ii) Use of Fair Trade Practices:
In every society, activities such as hoarding, black marketing and over-charging are considered undesirable. Additionally, misleading advertisements often give a false idea of ??the quality of the product. These ads deceive customers and business people to use it for great profit.
This is an unfair trade practice. Business units can not make artificial deficiencies of necessities or raise prices to earn more profit. All these activities get bad names and sometimes make traders liable for penalties as well as imprisonment under the law. Therefore, business objectives should practice fair trade practices for the welfare of consumers as well as society.
(iii) Contribution to General Welfare of the Association:
Business units should work for general welfare and community improvement. This is possible through the implementation of better schools and colleges to open vocational training centers to train people to get their lives, set up hospitals for medical facilities and provide recreational facilities for the general public such as parks, sports complexes and others.
Human purpose refers to a purpose that aims to prosperity and meet the expectations of workers as well as persons with disabilities, disabilities and lack of proper education and training. The objectives of the human business can include the well-being of the workers’ economy, social satisfaction and worker psychology and human resource development.
(i) Worker’s Economic Welfare:
In-house business workers must be provided with incentives and incentives for the benefit of funds, pensions and other benefits such as medical facilities, housing facilities and others. With this, they feel more satisfied at work and contribute more to business.
(ii) Social Satisfaction and Work Psychology:
It is the duty of the business unit to provide social and psychological satisfaction to their employees. This is impossible by making interesting and challenging jobs, putting the right person in the right job and reducing the boredom. Opportunities for promotion and career advancement should also be given to employees.
Furthermore, employee complaints should be given immediate attention and their recommendations should be taken seriously when decisions are made. If employees are happy and satisfied, they can put the best effort in the work.
(iii) Human Resource Development:
Workers as human beings always want to grow. Their growth requires proper training and development. Businesses can prosper if working people can improve their skills and develop their skills and competencies in the course of time. It is therefore important that businesses have to organize training and development programs for their employees.
(iv) Social Welfare Towards Social and Economic Affairs:
Business units being part of an indispensable part of society should help retreat classes as well as people who are physically and mentally challenged. This can be done in many ways. For example, vocational training programs can be set up to increase the income capability of people who are back in society. When recruiting its employees, businesses should give priority to people who are physically and mentally challenging. Business units can also help and encourage outstanding students by awarding scholarships for tertiary education.
Being an important part of the country, every business must have the goal of meeting the goals and aspirations of the country. The goal of this country is to provide employment opportunities to its citizens, earn income for their control, become independent in the production of goods and services, promote social justice, and others. Business activity must be done by keeping the goal of this country in mind, which can be called the national business objective.
Here are the business objectives of the country.
(i) Job Creation:
One of the main goals of the national business is to create opportunities for public employment. This can be achieved by creating new business units, expanding markets, expanding distribution channels, and so on.
(ii) Social Justice Promotion:
As a responsible citizen, a businessman is expected to provide equal opportunity to everyone he is dealing with. He is also expected to provide equal opportunities to all employees to work and move forward. Towards this goal special attention should be paid to the weak and backward part of society.
(iii) Production by Country Preference:
Business units must produce and supply goods in accordance with the priorities set out in government plans and policies. One of the national business destinations in our country is to increase the production and supply of essential goods at an affordable price.
(iv) Contribute to Country Revenue:
Business owners must pay their taxes and fees honestly and regularly. This will increase government revenue, which can be used for national development.
(v) Expectations and Export Promotions:
To help countries become self-reliant, business units have additional responsibilities to restrict imports of goods. In addition, every business unit should target increased exports and increase the country’s foreign exchange reserves.
Previously India had very limited business relations with other countries. There is a very strict policy for the import and export of goods and services. However, nowadays due to liberal liberal economic and liberal exports, restrictions on foreign investment have been eliminated and the obligation on imported goods has been significantly reduced.
This change leads to increased competition in the market. Today because globalization of the whole world has become a huge market. Goods produced in one country are available in other countries. Therefore, in order to face competition in the global marketplace, every business has a specific objective in mind, which can be called global objectives. Let’s learn about it.
(i) Raising the General Standard of Life:
The growth of cross-border business activities makes quality goods available at affordable prices worldwide. People from one country can use similar types of goods that people use in other countries. This increases the standard of living of the people.
(ii) Reduce Disparities among Nations:
Businesses should help reduce the shortage of rich and poor countries in the world by expanding their operations. By way of capital investment in developing and developed countries, it can nurture their industrial and economic growth.
(iii) Making Competitive Goods and Services in the World:
Businesses should produce competitive goods and services globally and have huge demand in foreign markets. This will enhance the image of the exporter’s country and also generate more foreign exchange for the country.