Tag: Business

Business!

Businesses can privately own, not-for-profit or state-owned. An organization or economic system where goods and services are exchanged for one another or for money. Every Business requires some form of investment and enough customers to whom. Its output can sell on a consistent basis in order to make a profit. A paid occupation, especially one that involves prolonged training and a formal qualification.

A Company (also known as an enterprise, a company, or a firm) is an organizational entity and legal entity made up of an association of people, be they natural, legal, or a mixture of both. Who share a common purpose and unite in order to focus their various talents and organize. Their collectively available skills or resources to achieve specific declared goals and are involving in the provision of goods and services to consumers. A business can also describe as an organization that provides goods and services for human needs.

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  • Fourteen Common Myths About Entrepreneurs

    Fourteen Common Myths About Entrepreneurs

    Common Myths About Entrepreneurs; There are many misconceptions about who entrepreneurs are and what motivates them to launch firms to develop their ideas. Some misconceptions are because of the media covering atypical entrepreneurs, such as a couple of college students who obtain venture capital to fund a small business that they grow into a multimillion-dollar company.

    Here are the best fourteen Common Myths About Entrepreneurs.

    Such articles rarely state that these entrepreneurs are the exception rather than the norm and that their success is a result of carefully executing an appropriate plan to commercialize what inherently is a solid business idea. Indeed, the success of many of the entrepreneurs we study in each chapter’s Opening Profile is a result of carefully executing the different aspects of the entrepreneurial process. Let’s look at the most common myths and the realities of entrepreneurs.

    An entrepreneur has been defining as,

    “A person who starts, organizes and manages any enterprise, especially a business, usually with considerable initiative and risk”. “Rather than working as an employee, an entrepreneur runs a small business and assumes all the risk and reward of a given business venture, idea, or good or service offered for sale. The entrepreneur commonly sees as a business leader and innovator of new ideas and business processes.”

    Here are Fourteen Common types of Myths of Entrepreneurs:

    The following common myths of entrepreneurs are below;

    Myth I: Entrepreneurs are born, not made;

    This myth bases on the mistaken belief that some people genetically predisposes to be entrepreneurs. The consensus of many hundreds of studies on the psychological and sociological makeup of entrepreneurs is that entrepreneurs are not genetically different from other people. This evidence can interpret as meaning that no one is “born” to be an entrepreneur and that everyone has the potential to become one. Whether someone does or doesn’t is a function of environment, life experiences, and personal choices. However, there are personality traits and characteristics commonly associated with entrepreneurs; these are Common traits, myth, and Characteristics of Entrepreneurs;

    • A moderate risk taker – Optimistic disposition
    • A networker – Persuasive
    • Achievement motivated – Promoter
    • Alert to opportunities – Resource assembler/leverager
    • Creative – Self-confident
    • Decisive – Self-starter
    • Energetic – Tenacious
    • A strong work ethic – Tolerant of ambiguity
    • Lengthy attention span – Visionary

    These traits are developed over time and evolve from an individual’s social context. For example, studies show that people with parents who were self-employed are more likely to become entrepreneurs. After witnessing a father’s or mother’s independence in the workplace, an individual is more likely to find independence appealing.

    Similarly, people who personally know an entrepreneur is more than twice as likely to involve in starting a new firm as those with no entrepreneur acquaintances or role models. The positive impact of knowing an entrepreneur is explained by the fact that direct observation of other entrepreneurs reduces the ambiguity and uncertainty associated with the entrepreneurial process.

    Myth II: Entrepreneurs are gamblers;

    The second myth about entrepreneurs is that they are gamblers and take big risks. The truth is, entrepreneurs are usually moderate risk-takers, as are most people. The idea that entrepreneurs are gamblers originates from two sources. First, entrepreneurs typically have less structured jobs, and so they face a more uncertain set of possibilities than managers or rank-and-file employees.

    For example, an entrepreneur who starts a social network consulting service has a less stable job than one working for a state governmental agency. Second, many entrepreneurs have a strong need to achieve and often set challenging goals, a behavior that sometimes equates with risk-taking.

    Myth III: Entrepreneurs motivate primarily by money;

    It is naïve to think that entrepreneurs don’t seek financial rewards. As discussed previously, however, money is rarely the primary reason entrepreneurs start new firms and persevere. The importance and role of money in a start-up is put in perspective by Colin Angle, the founder, and CEO of iRobot, the maker of the popular Roomba robotic vacuum cleaner.

    Commenting on his company’s mission statement Angle said: Our, “Build Cool Stuff, Deliver Great Products, Have Fun, Make Money, Change the World” (mission statement) kept us (in the early days of the Company) unified with a common purpose while gut-wrenching change surrounded us. It reminded us that our goal was to have fun and make money. Most importantly, it reminded us that our mission was not only to make money but to change the world in the process. Some entrepreneurs warn that the pursuit of money can be distracting. Media mogul Ted Turner said, “If you think money is a really big deal you’ll be too scared of losing it to get it”.

    Extra Things;

    Similarly, Sam Walton, commenting on all the media attention that surrounded him after he was named the richest man in America by Forbes magazine in 1985, said:

    Here’s the thing: money has never meant that much to me, not even in the sense of keeping score. … We’re not ashamed of having money, but I just don’t believe a big showy lifestyle is appropriate for anywhere, least of all here in Bentonville where folks work hard for their money. We all know that everyone puts on their trousers one leg at a time. … I still can’t believe it was news that I get my hair cut at the barbershop. Where else would I get it cut? Why do I drive a pickup truck? What am I supposed to haul my dogs around in, a Rolls-Royce?

    Myth IV: Entrepreneurs should be young and energetic;

    Entrepreneurial activity is fairly evenly spread out over age ranges. According to an Index of Entrepreneurial Activity maintained by the Kauffman Foundation, 26 percent of entrepreneurs of ages 20 to 34, 25 percent of ages 35 to 44, 25 percent of ages 45 to 54, and 23 percent of ages 55 to 64. The biggest jump, by far, from 1996 to 2010, which is the period the Kauffman date covers, is the 55 to 64 age bracket. A total of 14 percent of entrepreneurs were 55 to 64 years old in 1996, compared to 23 percent in 2010.

    The increasing number of older-aged entrepreneurs is a big change in the entrepreneurial landscape in the United States. Although it is important to be energetic, investors often cite the strength of the entrepreneur (or team of entrepreneurs) as their most important criterion in the decision to fund new ventures. A sentiment that venture capitalists often express is that they would rather fund a strong entrepreneur with a mediocre business idea than fund a strong business idea and a mediocre entrepreneur.

    What makes an entrepreneur “strong” in the eyes of an investor is the experience in the area of the proposed business, skills and abilities that will help the business, a solid reputation, a track record of success, and passion about the business idea. The first four of these five qualities favor older rather than younger entrepreneurs.

    Myth V: Entrepreneurs love the spotlight;

    Indeed, some entrepreneurs are flamboyant; however, the vast majority of them do not attract public attention. Many entrepreneurs, because they are working on proprietary products or services, avoid public notice. Consider that entrepreneurs are the source of the launch of many of the 2,850 companies listed on the NASDAQ, and many of these entrepreneurs are still actively involved with their firms. But how many of these entrepreneurs can you name? Perhaps a half dozen? Most of us could come up with Bill Gates of Microsoft, Jeff Bezos of Amazon.com, Steve Jobs of Apple Inc., Mark Zuckerberg of Facebook and maybe Larry Page and Sergey Brin of Google.

    Whether or not they sought attention, these are the entrepreneurs who are often in the news. But few of us could name the founders of Netflix, Twitter, or GAP even though we frequently use these firms’ products and services. These entrepreneurs, like most, have either avoided attention or been passed over by the popular press. They defy the myth that entrepreneurs, more so than other groups in our society, love the spotlight. Now, Common Myths About Entrepreneurs by businesstown.com.

    Myth VI: Entrepreneurs Are High-Risk Takers;

    Entrepreneurs, Rye states, are often thought of in terms of the risk they assume. Even the dictionary describes an entrepreneur as one who assumes business risks. However, like all prudent businesspeople, entrepreneurs know that taking high risks is a gamble. Entrepreneurs are neither high nor low-risk takers. They prefer situations in which they can influence the outcome, and they like challenges if they believe the odds are in their favor.

    They seldom act until they have assessed all the risks associated with an endeavor, and they have an innate ability to make sense out of complexity. These are traits that carry them on to success where others fail. I certainly agree with Rye. Entrepreneurs generally seek the best risk/reward situation. Like most humans, they are often are a little hesitant to risk everything and take wild chances.

    Myth VII: Entrepreneurs Mainly Motivate to Get Rich;

    Any successful entrepreneur, argues Rye, will tell you that starting a business is not a get-rich-quick alternative. New businesses usually take from one to three years to turn a profit. In the meantime, you consider being doing well if you break even. During the business start-up stage, entrepreneurs do not buy anything they do not need, such as fancy cars. Most drive junk cars and use their surplus money to pay off debt or reinvest it in the business. Their focus is on creating a company with a strong financial base for future expansion.

    I largely agree with Rye. For entrepreneurs, money isn’t everything. But nothing is embarrassing about being partially motivated by money, as are most entrepreneurs. If entrepreneurs couldn’t get rich and get a financial reward for their work, the United States could be almost as poor as Cuba. It is OK to make money, build a business, and help build your local economy in the process.

    Myth VIII: Entrepreneurs Give Little Attention to Their Personal Life;

    All successful entrepreneurs, Rye says, work long hours, which cuts into their personal life. However, long working hours are not unique to entrepreneurs. Many corporate managers and executives work well beyond the average 40-hour workweek. The primary difference between the entrepreneur and his or her corporate counterpart is schedule control.

    In the corporate world, you may not have control over your schedule. If some higher-level manager calls a Saturday meeting, you’ve got no choice but to be there. Entrepreneurs don’t mind working 60- to 70-hour weeks, but they will do everything they can to preserve their private time. They schedule important meetings during the week so that they can have weekends off for their personal life, which is very important to them.

    I find what Rye says is true, that most entrepreneurs do not give a lot of attention to their personal lives. I have, at times, been an outlier and had almost no personal time, such as when I was a full-time student at Harvard Business School and running four start-up businesses at the same time, or was a full-time college student and starting an independent newspaper business. Sometimes, as an entrepreneur with an especially fast-growing business, you are going to have to sacrifice personal time.

    Myth IX: Entrepreneurs Are Often High-Tech Wizards;

    We are all aware, says Rye, of a few high-tech entrepreneurial wizards who have made it. Media attention overplays the success of these few high-tech entrepreneurs. Only a small percentage of today’s businesses consider high tech, and what was considered high tech just a few years ago not considers high tech by today’s standards.

    It takes high-profit margins, not high tech, to make it as an entrepreneur. One has only to look at the recent problems that have plagued the computer industry to understand this basic principle. High-tech personal computers did very well when they made high-profit margins. The industry then went into a nosedive when profits fell.

    Yes, I think Rye is right on the money. Very few businesses require high tech abilities. I have started and run a multimedia business, an interactive software business, and two Internet businesses, with virtually no tech experience or expertise. (Although to be sure, I did learn to do a little computer programming along the way when I start these businesses, to help me appreciate what the engineers were doing). Furthermore, most businesses are not even tech businesses at all.

    Myth X: Entrepreneurs Are Loners and Introverts;

    Initially, Rye says, entrepreneurs might work alone on a business idea by tinkering in the solitude of their garage or den. In this myth, I don’t agree with Rye. An astute entrepreneur knows that he or she must draw on the experience and ideas of others to succeed. Entrepreneurs will actively seek the advice of others and will make many business contacts to validate their business ideas. The entrepreneur who is a loner and will not talk to anybody will never start a successful business.

    I’ve spent a lot of time working largely in isolation during the early stages of building businesses. I think a lot of other entrepreneurs have, too. Not ideal in hindsight, but that’s what I often did. Generally, I think entrepreneurs are willing to work independently if it is necessary to succeed. But even independent-minded people can get lonely, especially if you are working day and night in a small home-based business.

    Myth XI: Entrepreneurs Are Job Hoppers;

    A recent study of successful entrepreneurs, notes Rye, showed that most of them worked for a large corporation for several years before they started their own business. In every instance, they used the corporate structure to learn everything they could about the business they intended to establish before they started their own. Entrepreneurs are not job hoppers.

    I tend to agree with Rye. I think most entrepreneurs have usually had a good track record in the workplace. Most have spent years working for other people before going on their own. But you don’t have to do so to succeed. The longest single job I ever held lasted about eight weeks, but in total, I’ve only worked a few months for anyone else in my entire lifetime.

    Myth XII: Entrepreneurs Finance Their Business with Venture Capital;

    Entrepreneurs, Rye says, know that venture capital money is one of the most expensive forms of funding they can get. Consequently, they will avoid venture capitalists, using them only as a last resort. Most entrepreneurs fund their business from personal savings, or by borrowing from friends or lending institutions.

    I often remind people that venture capital is a relatively small industry and, as such, finances an extremely minute number of small businesses. To finance by a VC firm, your business might need to meet all kinds of criteria, and then find a VC firm that loves it. Furthermore, since VC firms tend not to want to put much money into any one startup, most VC-funded startups have to get money from not one but several different firms.

    Myth XIII: Entrepreneurs Are Often Ruthless or Deceptive;

    Rye thinks that some people believe that to make it as an entrepreneur; you have to be deceptive and step on anybody who gets in your way. On the contrary, this mode of operation doesn’t work for the entrepreneur. The truly ruthless or deceptive entrepreneur will often alienate others; and, forces to waste time and energy repairing relationships with employees, customers, and suppliers, or simply fail.

    I don’t know if people predispose to think negatively of entrepreneurs as Rye states. But, in any event, I think entrepreneurs have some bad apples in their ranks. Not many, but some. I have lost sales to competitors who fabricate the facts, exaggerate the truth, slander their competitors, and engage in all kinds of other unethical behavior. But I have found that such competitors eventually implode.

    Often, they lose their best employees, whom they also treat poorly, or they lose their customers. Once, when I was in a dogfight with a ruthless competitor in a business that was extremely dependent upon sales, his three best salespeople, as well as his sales manager, approach me on their initiative and end up joining my team.

    Myth XIV: Entrepreneurs Have Limited Dedication;

    Rye says it is a myth that entrepreneurs do not dedicate to any one thing. But he adds that dedication is an attribute that all successful entrepreneurs exhibit. They dedicate to becoming their boss. To this end, they’ll work like a dog to make their business succeed.

    While I agree with Rye that entrepreneurs will work like a dog to succeed; I do think that many entrepreneurs can change businesses or direction quicker than other people. Often, this ability to switch direction quickly can be essential for success, and entrepreneurs tend not to switch direction recklessly, although there are always exceptions. Finally, you may understand the best fourteen Common Myths About Entrepreneurs.

    Fourteen Common Myths About Entrepreneurs Macbook
    Fourteen Common Myths About Entrepreneurs, Macbook image from Pixabay.

    Notes: Here are read it Common Myths About Entrepreneurs, Would you like more read it; What is an Entrepreneur? and also, read it What Is Entrepreneurship?, don’t forget read it; Why Become an Entrepreneur?, Next up; Who Changing Demographics of Entrepreneurs?.

  • Why Become an Entrepreneur? Make Own Business

    Why Become an Entrepreneur? The three primary reasons that people become an entrepreneur and start their own firms are to be their own boss, pursue their own ideas, and realize financial rewards. Also, Top best major degree to become an Entrepreneur ideas essay online with no money for inside a company today.

    Here is the article to explain, How to Become an Entrepreneur? Their ideas essay online with no money for inside a company today.

    The first of these reasons being one’s own boss gives most commonly. The following reason below are;

    Be Their Own Boss.

    The best major degree to become an entrepreneur inside a company with no money. This doesn’t mean, however, that entrepreneur is difficult to work with or that they have trouble accepting authority. Instead, many entrepreneurs want to be their own boss because either they have had a longtime ambition to own their own firm or because they have become frustrated working in traditional jobs.

    The type of frustration that some entrepreneurs feel working in conventional jobs is exemplified by Wendy DeFeudis, the founder of VeryWendy, a company that makes customized social invitations. Commenting on how her experiences working for herself have been more satisfying than working for a large firm, DeFeudis remarked:

    I always wanted to be my own boss, I felt confined by the corporate structure.

    I found it frustrating and a complete waste of time—a waste to have to sell my ideas to multiple people and attend all kinds of internal meetings before moving forward with a concept.

    Why you’re to be?

    Sometimes the desire to be their own boss results from a realization that the only way they’ll achieve an important personal or professional goal is to start their own business. Christopher Jones, David Labat, and Mary McGrath started a business for this reason. The three, who are educational psychologists, had secure jobs at a public school in the Santa Clarita Valley, north of Los Angeles.

    Over time, they felt inhibited by the limited range of services they were able to provide students in a school setting; so they left their jobs to start Dynamic Interventions, a more full-service educational psychology, and counseling center. Recalling why he and his colleagues needed to leave their jobs to become their own bosses Jones said:

    The idea came from some general frustrations with not being able to practice the breadth of service that [we wanted to]. And instead of going to work and being angry about it for the next 30 years, we decided to do something about it. With Dynamic Interventions, our service doesn’t stop at the end of the school day. We can go more in-depth and be more beneficial to the whole family.”

    Pursue Their Own Ideas:

    The second reason people start their own firms is to pursue their own ideas (201). Some people are naturally alert, and when they recognize ideas for new products or services; they have a desire to see those ideas realized. Corporate entrepreneurs who innovate within the context of an existing firm typically have a mechanism for their ideas to become known.

    Established firms, however, often resist innovation. When this happens, employees are left with good ideas that go unfulfilled. Because of their passion and commitment; some employees choose to leave the firm employing them to start their own business as the means to develop their own ideas. This chain of events can take place in noncorporate settings, too.

    For example, some people, through a hobby, leisure activity, or just everyday life; recognize the need for a product or service that is not available in the marketplace. If the idea is viable enough to support a business; they commit tremendous time and energy to convert the idea into a part-time or full-time firm.

    Other ideas:

    An example of a person who left a job to pursue an idea is Kevin Mann, the founder of Graphic.ly; a social digital distribution platform for comic book publishers and fans. Mann became discouraged when he couldn’t find a comic book in which he was interested. He even took a 100-mile train ride to search for it in a neighboring city. His frustration boiled over on the train ride home:

    “I kept thinking that there had to be a better way of buying comics, and then it dawned on me. That morning I had purchased a movie from iTunes, which I was watching right there on the train. Why shouldn’t buying comics be just as easy? Why did I have to travel over 100 miles and waste the better part of a day, all for nothing? I realized I had two options. I could quit buying comics or I could quit my job and build the iTunes of comics.”

    This revelation led to the launch of Graphic.ly in the fall of 2009. Today, Graphic.ly is both a robust platform for the sale of digital comics and a social network for people who enjoy discussing the comics they’re reading. Following up on the story about the train ride, Mann went on to say:

    That’s how Graphic.ly started and my enthusiasm for comics has now transferred to a business I love being part of. Every single day I am excited to go to work. I get to create and innovate in a sector I love. Ultimately, I’ll solve a problem that was ruining something very special to me.

    Pursue Financial Rewards:

    Finally, people start their own firms to pursue financial rewards. This motivation, however, is typically secondary to the first two and often fails to live up to its hype. The average entrepreneur does not make more money than someone with a similar amount of responsibility in a traditional job. The financial lure of entrepreneurship is its upside potential. People such as Jeff Bezos of Amazon, Mark Zuckerberg of Facebook, and Larry Page, and Sergey Brin of Google made hundreds of millions of dollars building their firms. Money is also a unifier. Making a profit and increasing the value of a company is a solidifying goal that people can rally around.

    But money is rarely the primary motivation behind the launch of an entrepreneurial firm. Some entrepreneurs even report that the financial rewards associated with entrepreneurship can be bittersweet if they accompany by losing control of their firm. For example, Sir Richard Branson, after selling Virgin Records, wrote, “I remember walking down the street (after the sale was completed). I was crying. Tears . . . [were] streaming down my face. And there I was holding a check for a billion dollars. . . . If you’d have seen me, you would have thought I was loony. A billion dollars.” For Branson, it wasn’t just the money it was the thrill of building the business, and of seeing the success of his initial idea.

    Why Become an Entrepreneur Make Own Business Image
    Why Become an Entrepreneur? Make Own Business; Image from Pixabay.
  • Five M’s in the Business

    Five M’s in the Business

    Learn how the five M’s – Man, Machines, Materials, Money, and Method – are crucial resources in effective business management.

    Five M’s in the Business

    Efficient management is the lifeboat of any developed business. The five M’s, which can be considered the resources of the business, are Man, Machines, Materials, Money, and Method.

    1. Man

    Management is the art of getting things done by a group of people. Thus, the availability of qualified, trained, skilled, experienced, and competent people is the most crucial factor in any management.

    Advantages:

    • Innovation: Qualified, skilled, and experienced individuals can bring in new ideas and innovations.
    • Productivity: Competent staff enhance productivity and efficiency.

    Disadvantages:

    2. Machines

    Management involves knowing what needs to be done and ensuring it’s done in the best and most cost-effective way. Thus, having capable machines and equipment is essential to achieve this.

    Advantages:

    • Efficiency: Machines can perform tasks faster and more accurately than humans.
    • Consistency: Machines provide consistent output quality.

    Disadvantages:

    • Cost: High initial investment and maintenance costs.
    • Obsolescence: Technological advancements can make existing machinery outdated.

    3. Materials

    Quality, quantity, availability, cost/market price, and the transportation of raw materials, semi-finished goods, and finished products are critical components to the success of management.

    Advantages:

    • Quality Control: High-quality materials lead to high-quality products, increasing customer satisfaction.
    • Availability: Timely availability of materials ensures continuous production.

    Disadvantages:

    • Cost Fluctuation: Material costs can fluctuate due to market conditions.
    • Supply Chain Risks: Disruptions in the supply chain can affect the availability of materials.

    4. Money

    Financial capital is utilized by businesses to acquire what they need to produce their products or provide their services. The availability of funds is extremely important for procuring capital goods, raw materials, tools, consumables, and working capital.

    Advantages:

    • Resource Acquisition: Adequate funds allow businesses to acquire necessary resources and expand operations.
    • Stability: Financial stability ensures smooth operations and the ability to withstand economic downturns.

    Disadvantages:

    • Debt: Excessive borrowing can lead to high-interest obligations and financial distress.
    • Mismanagement: Poor financial management can lead to inefficient use of funds.

    5. Method

    The process or method by which work is accomplished is crucial. The proper method ensures the required quality, quantity, and timely delivery, achieving the management objectives.

    Advantages:

    • Standardization: Proper methods ensure consistent quality and efficient production.
    • Competitive Edge: Innovative methods can differentiate a company from its competitors.

    Disadvantages:

    • Inflexibility: Overly rigid methods can stifle creativity and adaptability.
    • Implementation Cost: Developing and implementing new methods can be costly and time-consuming.

    Methods can create a competitive edge. For example, consider two girls preparing a cup of tea each with the same raw materials: milk, sugar, tea powder, etc.

    • Girl A: Puts milk in the utensil and boils it, then adds water, sugar, and tea powder, and boils it again.
    • Girl B: Boils water and sugar, then adds tea powder, and lastly adds milk.

    The two cups of tea taste different despite having the same ingredients because the method used makes the difference. Standardized methods ensure consistent results. That’s why the quality of idli sambar in an Udipi restaurant is always the same and why McDonald’s offers the same taste of French Fries worldwide. Standardized methods address these needs.

    Companies can also differentiate through methods. For example, Shampoo produced by Company A is in high demand. Company B, seeing this, researches Company A’s methods, improves upon them, and adds extra benefits to capture more market share.

    Similarly, among four bhelwalas, the one in demand might be successful due to a better preparation method and additional customer advantages like cleanliness, better presentation, extra quantity, etc., offering better value for money to the customers.

    By understanding and effectively managing these five M’s, businesses can optimize their operations and achieve their objectives. However, it is equally important to be aware of the potential drawbacks and address them proactively.

  • Types of Business

    Types of Business:

    There are three major types of businesses:

    1. Service Business

    A service type of business provides intangible products (products with no physical form). Service type firms offer professional skills, expertise, advice, and other similar products.

    Examples of service businesses are schools, repair shops, hair salons, banks, accounting firms, and law firms.

    1. Merchandising Business

    This type of business buys products at wholesale price and sells the same at retail price. They are known as “buy and sell” businesses. They make the profit by selling the products at prices higher than their purchase costs.

    A merchandising business sells a product without changing its form. Examples are grocery stores, convenience stores, distributors, and other resellers.

    1. Manufacturing Business

    Unlike a merchandising business, a manufacturing business buys products with the intention of using them as materials in making a new product. Thus, there is a transformation of the products purchased.

    A manufacturing business combines raw materials, labor, and factory overhead in its production process. The manufactured goods will then be sold to customers.

    Hybrid Business

    Hybrid businesses are companies that may be classified in more than one type of business. A restaurant, for example, combines ingredients in making a fine meal (manufacturing), sells a cold bottle of wine (merchandising), and fills customer orders (service).

    Nonetheless, these companies may be classified according to their major business interest. In that case, restaurants are more of the service type – they provide dining services.

    Forms Types of Business Organization:

    These are the basic forms of business ownership:

    1. Sole Proprietorship

    A sole proprietorship is a business owned by only one person. It is easy to set-up and is the least costly among all forms of ownership.

    The owner faces unlimited liability; meaning, the creditors of the business may go after the personal assets of the owner if the business cannot pay them.

    The sole proprietorship form is usually adopted by small business entities.

    1. Partnership

    A partnership is a business owned by two or more persons who contribute resources into the entity. The partners divide the profits of the business among themselves.

    In general partnerships, all partners have unlimited liability. In limited partnerships, creditors cannot go after the personal assets of the limited partners.

    1. Corporation

    A corporation is a business organization that has a separate legal personality from its owners. Ownership in a stock corporation is represented by shares of stock.

    The owners (stockholders) enjoy limited liability but have limited involvement in the company’s operations. The board of directors, an elected group of the stockholders, controls the activities of the corporation.

    In addition to those basic forms of business ownership, these are some other types of organizations that are common today:

    Limited Liability Company:

    Limited liability companies (LLCs) in the USA, are hybrid forms of business that have characteristics of both a corporation and a partnership. An LLC is not incorporated; hence, it is not considered a corporation.

    Nonetheless, the owners enjoy limited liability like in a corporation. An LLC may elect to be taxed as a sole proprietorship, a partnership, or a corporation.

    Cooperative:

    A cooperative is a business organization owned by a group of individuals and is operated for their mutual benefit. The persons making up the group are called members. Cooperatives may be incorporated or unincorporated.

    Some examples of cooperatives are water and electricity (utility) cooperatives, cooperative banking, credit unions, and housing cooperatives; This is simple types of business read and understanding, around world many many types of business run.

  • What is a Business? Introduction, Meaning, and Definition

    What is a Business? Introduction, Meaning, and Definition

    A business (also known as an enterprise, a company or a firm) is an organizational entity involved in the provision of goods and services to consumers. Businesses as a form of economic activity are prevalent in capitalist economies, where most of them are privately own and provide goods and services to customers in exchange for other goods, services, or money. Businesses may also be social non-profit enterprises or state-owned public enterprises charged by governments with specific social and economic objectives.

    What is a Business? Introduction, Meaning, and Definition.

    Businesses owned by multiple individuals may form an incorporated company or jointly organized as a partnership. Countries have different laws that may ascribe different rights to various business entities.

    An organization or economic system where goods and services are exchanging for one another or money. Every enterprise requires some form of investment and enough customers to whom its output can sale consistently to make a profit. Businesses can privately own, not-for-profit or state-owned. An example of a corporate business is PepsiCo, while mom-and-pop catering businesses a private enterprise.

    An enterprise is an organization or enterprising entity engaged in commercial, industrial or professional activities. A company transacts enterprise activities through the production of a good, offering of a service or retailing of already manufactured products. An enterprise can be a for-profit entity or a nonprofit organization that operates to fulfill a charitable mission.

    Nature:

    The term business comes from busyness or the state of being busy—any ac­tivity a man is busy about. Businesses an economic activity with the object of earning an income i.e. profit and thereby accumulate wealth. The eco­nomic activity must be regular and continuous.

    It involves:

    • Production of goods to sell them at a profit or
    • Merely purchase of goods to resell at a profit.

    The real object of any enterprise, as pointed by Peter Drucker is to create a customer and to ensure repeat sale which is possi­ble only when the customer can get due service and satisfaction in the market place where the exchange takes place in monetary terms.

    Concept:

    The following concept below are;

    History of Concept:

    In the old days, the enterprise was conceiving merely in terms of busi­ness. The enterprise of business is business. In those days the sole and exclusive objective of busi­ness was the maximization of profit at any cost.

    The business began merely as an institution for the pur­pose of making money. So long as man-made money and kept himself out of jail he was considering successful.

    He felt no particular obligation and acknowledge no responsibility to the community. As he was the owner of the enterprise he thought he has the perfect right to do with it what he, please.

    Modern Concept:

    The modern busi­ness enterprise is a social and economic institu­tion. It does not live in a vacuum. Enterprise by it­self is not an end but a means to achieve an end – i.e., public welfare. Urwick has rightly pointed out that profit can no longer be the main objective of a business than eating is the main objective of living.

    According to Peter Drucker, the objective of the business is to create a customer.

    The first business of every business is to se­cure customers. The customer is the master and to serve him well is the only purpose of business. An enterprise cannot survive without customers. Mod­ern business aims at a profit through service.

    What is a Business Introduction Meaning and Definition
    What is a Business? Introduction, Meaning, and Definition #Pixabay.

    Basic Definitions:

    • A person’s regular occupation, profession, or trade, an activity that someone engages in a person’s concern, work that has to finish or matters that have to attend to.
    • Commercial activity, trade considered in terms of its volume or profitability, a commercial house or firm.
    • A situation or series of events, typically a scandalous or discreditable one, a difficult matter. Action on stage other than dialogue. A very enjoyable or popular person or thing.

    Definition of Business:

    According to well-known professors William Pride, Robert Hughes, and Jack Kapoor, business is,

    “The organized effort of individuals to produce and sell, for a profit, the goods, and services that satisfy society’s needs.”

    A business, then, is an organization which seeks to make a profit through individuals working toward common goals. The goals of the business will vary based on the type of business and the business strategy being uses. Regardless of the preferred strategy, businesses must provide a service, product, or good. That meets a need of society in some way.

  • Income Tax Explained

    Income Tax Explained

    Discover the key features of the Income Tax Act 1961. Get insights into the provisions for exemptions, deductions, rebates, and reliefs.

    Income Tax Explained: Key Concepts and Regulations

    The Income Tax Department functions under supervision and control of the Central Board of Direct Taxes (CBDT). It has around 60,000 personnel located in more than 500 cities and towns across the country. The field offices are divided into regions, and each region is headed by a Chief Commissioner of Income Tax. Every region is assigned annual performance targets, such as revenue collections, and is provided with necessary expenditure budget to meet its operating expenses. Right to Information

    The Income Tax Act 1961 lays down the framework or the basis of charge and the computation of total income of a person. It also stipulates the manner in which it is to be brought to tax, defining in detail the exemptions, deductions, rebates and reliefs. The Act defines Income Tax Authorities, their jurisdiction and powers It also lays down the manner of enforcement of the Act by such authorities through an integrated process of assessments, collection and recovery, appeals and revisions, penalties and prosecutions. The Act is fast changing and dynamic in nature and undergoes amendments annually through the Finance Act.

    How to Prepare Income Tax by Tally ERP? 

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    What is Income Tax?

    It is a tax imposed by the government on the income earned by individuals and businesses within its jurisdiction. It is one of the primary sources of revenue for the government and is used to fund various public services and infrastructural development projects.

    Types of Income Taxes

    1. Individual Tax: Levied on the income of individuals. This includes wages, salaries, bonuses, and other forms of earnings.
    2. Corporate Tax: Imposed on the profits of corporations and businesses.
    3. Capital Gains Tax: Charged on the profit from the sale of assets or investments.
    4. Payroll Tax: Deducted directly from an employee’s salary and used to fund social security and Medicare.
    5. Inheritance Tax: Imposed on individuals who inherit estate or money following the death of the owner.

    Examples of Income Tax Considerations

    • Exemptions: Specific incomes or entities are not subject to tax. For example, agricultural income in certain jurisdictions.
    • Deductions: Amounts that can be subtracted from gross income to determine taxable income, such as mortgage interest or charitable contributions.
    • Rebates: Refunds given to taxpayers when the tax paid exceeds the tax liability.
    • Reliefs: Reductions in tax liability granted to certain categories of taxpayer expenses, like healthcare costs.

    Importance of Income Taxes

    They are crucial for several reasons:

    1. Funding Government Operations: Provides revenue for the government to function and deliver public services.
    2. Economic Redistribution: Helps in redistributing wealth through progressive taxation systems.
    3. Public Investments: Supports public infrastructure like roads, schools, and hospitals.
    4. National Defense: Finances military and security forces.
    5. Social Services: Ensures funding for social welfare programs such as unemployment benefits, pensions, and healthcare.

    Advantages of Income Taxes

    1. Revenue Generation: Provides a steady and substantial source of government funding.
    2. Equitable Distribution: Progressive tax rates help in reducing income inequality.
    3. Economic Stability: Government can influence economic growth and stability through tax policies.
    4. Social Welfare: Enables the funding of essential public services and social programs.

    Disadvantages of Income Taxes

    1. Compliance Costs: Filing taxes can be complex and costly for taxpayers.
    2. Evasion: High tax rates can lead to tax evasion and underreporting of income.
    3. Economic Impact: High-income taxes can discourage entrepreneurship and investment.
    4. Disincentives: High tax rates might reduce incentives to work harder or earn more.

    In summary, while income taxes are essential for funding government operations and fostering economic stability, they come with their own set of challenges, including the potential for tax evasion and economic disincentives. Effective tax policy must balance these advantages and disadvantages to ensure fair and efficient taxation.

    Why Do We Have To Pay Income Taxes?

    They are fundamental to the functioning of modern governments and the provision of essential public services. Here are several reasons why we have to pay taxes:

    1. Funding Government Operations:

      They provide the primary source of revenue for the government, enabling it to finance its daily operations. This includes paying salaries for public employees, maintaining government buildings, and running various governmental departments.
    2. Public Services:

      The revenue from income taxes funds a wide range of public services that benefit society as a whole. This includes education, healthcare, public safety, transportation infrastructure, and social services like unemployment benefits and pensions.
    3. National Defense:

      Taxes are critical for funding a country’s defense and security. This includes the military, law enforcement agencies, and other national security operations.
    4. Economic Stability:

      They enables the government to manage economic stability and promote economic growth. By adjusting the tax rates and rebates, the government can influence spending and investment in the economy.
    5. Distribution of Wealth:

      Progressive income taxation helps in redistributing wealth more evenly across the society. It ensures that those who earn more contribute more to the public funds, which can be used to assist those with lower incomes.
    6. Reduction of Fiscal Deficit:

      They help in reducing the fiscal deficit, which is the difference between the government’s expenditures and its revenues. A lower fiscal deficit can lead to lower national debt and lower interest payments on that debt.
    7. Public Investment:

      They revenue is crucial for funding public investments in infrastructure, research and development, education, and other areas that are vital for long-term economic growth and development.

    In summary, paying income taxes is a civic duty that supports the functioning and development of the country, ensuring everyone has access to basic amenities and contributing to the overall economic health and stability.