Big business or large scale enterprise.

SETTING UP A BUSINESS

There are no life without business. Business is not art of having new ideas, it is art of using your new ideas in the right dosage and right moment.

Business is any commercial activity. It is production, distribution, sale of goods or services for the benefit of a customer and the profit of the seller.

There are different kinds of companies: business and non-profit organizations. There are different forms of setting up a business organizations: Self-proprietor, small business (less 50 employees), big business. Big business can be partnership or private or public limited company.

As for me, I would prefer to set up private limited company, because this way seems to me more realizable and safe. People with you set up a company can be your close relatives and capital of a corporation is formed from common recourses.

Lets turn to different stages of starting company. Firstly you should indentify a problem, get the idea, identify a market, create business plan and bring the investors and create a company.

So, the company can be created, but through time it can face to some different problems, which can bring it to do serious steps to saving company. Such step can be joint venture (товарищество): 2 or more companies agree to collaborate and jointly invest in a separate project. Merge (поглощение): 2 companies, often in a same industry, come together to form one company for different reasons, such as increase market share. Acquision or takeover (захват): one company accumulates enough of another company’s shares to take over control and ownership.

SETTING UP A BUSINESS

Business is any commercial activity. Today there are several forms of business organization.

Business organizations.

Non-profit organizations(not-for-profit organizations(AmE)). It is organizations with social aims such as helping those who are sick or poor, or encouraging artistic activity. They are also called charities,and form the voluntary sector,as they rely heavily on volunteers(unpaid workers). They are usually managed by paid professionals, and they put a lot of effort into fund-raising,getting people to donate (жаловать)money to the organization in the form of donations(дарственная).

3. Self-employed (Sole Trader or Sole Proprietor (UK)). The simplest way of starting a business. You are self-employed and entirely responsible for all aspects of the management of your business.

4. Small (less than 50 employees) or Medium enterprise (SME). For example, then two or more people starting a business together can set up a partnership. All partners are responsible for the debts of the partnership, and profits and losses are shared between them. A lot of professional people like lawyers, accountants and so on, work in partnerships.

Big business or large scale enterprise.

· Many large businesses in the UK are public limited companies (PLC), which means that the public can buy and sell their shares on the stock exchange. Examples include Marks & Spencer, British Telecom and the National Westminster Bank. The minimum share capital for a public limited company is £50,000; so many new businesses are likely to take one of the following forms.

· Private Limited Company - a company can be formed with a minimum of two people becoming its shareholders. They must appoint a director and a company secretary.If the company goes out of business, the responsibility of each shareholder is limited to the amount that they have contributed; they have limited liability. Such a company has Ltd (общество с ограниченной ответственностью) (Limited) after its name. In the US, businesses take the same basic forms. However, American companies are registered or incorporated with the authorities in the state where they have their headquarters(штаб-квартира). The abbreviations Inc and Corp refer to such companies. To sell shares to the public they must apply to the Securities Exchange Commission.

· Multinationals companies doing business in many countries and havinga complicate structure which include a parent or holding company and a number of subsidiaries, for example Coca-cola, Ford, Microsoft and so on.

Mutuals. Some companies, like certain life insurance companies,are mutuals.When you buy insurance with the company you become a member.Profits are theoretically owned by the members, so there are no shareholders. In Britain, another kind of mutual is building societies,which lend money to people who want to buy a house. But a lot of building societies have demutualized:they have become public limited companies with shareholders. This process is demutualization.

Advantages and disadvantages of different form of business

A: 1) You have total control of your business (Sole Trader)

2) This is a good way of sharing the pressure and work of starting business (partnership)

3) The financial ricks that you are taking are restricted (LTD)

4) You can increase your capital by selling shares (PLC)

D: 1) There is a danger that conflicts of personality could run your business (partnership)

2) It may be difficult to expand (Sole Trader)

3) You may have to sell your possession if the company gas into debts (Sole Trader or partnership).

Qualities of good entrepreneur are she or he could to:

- make own decision, but need time to think over it; - be the leader and get on with almost everybody

- plan exactly what he doing and evaluate the exact dangers of any situations; - can cope with stress.

If you want to start a business, good planning is important. Here are some stages to start business:

1. Get organized. Decide what your skills are. Find out if there is a market for them in your area, e.g. ask your neighbors what they need. Babysitting, coaching for exams or sports, and computer training are all possibilities.

Decide how much money you need to start your business. Think about how to get the capital can use your own money or you can ask the bank for а loan.If you get a loan, be sure you can afford to pay the interest.

3. Calculate your costs. First, work out your fixed costs, for example, the rent on your office or the interest on a loan. Then add your variable costs, for example, equipment or tax (if you pay it).

4. Work out how much to charge for your service. Find out what other people are charging and use this to set your own prices.

5. Your revenue is the amount of money you receive from selling your service. You need to calculate this very carefully. Your revenue is the number of hours worked multiplied by (x) the price per hour.

6. Your business will make a profit if your revenue for a year is more than your costs. If your costs are higher than the revenue, you'll make а loss. Work out carefully the number of hours you need to work.

Stages to start a company

1) Identify a problem; 2) Identify a market; 3) Propose an original solution or concept or get the idea of using a product; 4) conduct a feasibility study; 5) create the company; 6) invite private investors to join the project; 7) seek investment from major companies; 8) construct the assembly plant.

Business plan

Business plan is a document that shows how the entrepreneur will organize his or her business, how much he or she expects to sell and where the capital will come from. Once this information has been put down on paper, the entrepreneur can then choose an appropriate form for the company, register it with the authorities and open for business. Setting up a successful business requires careful preparation and planning but also involves a degree of risk-taking. There are a number of questions that all entrepreneurs must ask themselves concerning the products or services that they intend to sell, the competition that they will face, the structure of the business itself and the sources of finance that they will need to open their new venture. This means that all of these parameters must be defined in a business plan. Business plan has different forms in different countries. First of all it need for entrepreneur and next for bank, if he gets a loan.

Business plan checklist

1. Details of the business (Name and type of business 2. Personal details (Relevant work experience). 3. Personnel (Number of people / job function). 4. Product / service (Description). 5. Market (Who are your customers? Is your market growing, static or in decline? Who are the main competitors? What are the advantages of your product or service over the competition?). 6. Marketing (What sort of marketing or advertising do you intend to do?). 7. Premises / machinery / vehicles (Where do you intend to locate the business and why? What sort and size of premises will you need? What machinery / vehicles do you require?). 8. Objectives (What objectives do you have for the business?) For, example it may be concentrating on getting the business into profit or looking for other sites in other city area and expanding themanagement team. Eventually it might be possible to set up shops in different locations around the country.

Corporate Alliances and Acquisitions

As business and the world economy become increasingly competitive, more and more companies have to strengthen their operations to remain profitable. Companies can go about this in a number of ways, including the following.

Joint venture: Two or more companies agree to collaborate and jointly invest in a separate business project. This type of deal allows the partners to combine their strengths in one specific area.

Merger: Two companies, often in the same industry, come together to form one company. Companies merge for many reasons, for example, to increase market share and cut costs in certain areas, such as research and development.

Acquisition or takeover: One company accumulates enough of another company's shares to take over control and ownership.

Two companies may work together in a particular area by forming an alliance or joint venture; they may remain separate companies, or form a new company in which they both have a stake.

Examples of Mergers and takeovers

1) General Oil and PP have announced they are going to merge. It will be the biggest ever merger in the oil industry.

2) Blighty Telecom is to split into two, and demerge its fixed-line and mobile businesses as part of on-going restructuring. The aim of the demerger is to cut debt by £10 billion.

3) Ciments de France, the French building group, is to acquire Red Square Industries of the UK for 3.1 billion euro’s. This is a friendly bid, as KS1 are likely to welcome it and agree to it But the takeover comes only a year alter RSI rejected a hostile bid, an unwanted one.

4) Abbot Bank is doing badly, and may become the victim of a predator. There were rumours of a possible takeover by Bullion, but it says it won't play the white knight for Abbot by coming to its defence. This leaves Abbot exposed to acquisition, and it may be prey to a big international bank. Abbot does have a poison pill however, in the form of a special class of shares that will be very expensive for a predator to buy.

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