What are the Top 14 Tips to Create a Good Survey Online? Creating a successful survey project begins with a good design. Whether you’re using a template or starting from scratch, there are certain boxes you should check to ensure that your survey is intuitive, easy to take, and likely to complete.
Here are the articles to explain, Top 14 Tips to Create a Good Survey Online
In this piece, we’ll provide some invaluable advice on how best to design and distribute your surveys. Follow these tips to ensure that your next survey project is a total success.
Establish the survey’s purpose and parameters upfront
It’s important to craft a good introduction page for your survey, to keep participants engaged and willing to complete the whole thing. Make sure your intro page clearly and concisely explains the purpose of the survey—and also clarifies that the survey is confidential and that the survey respondent’s personal information will not misuse or sold to third-party buyers. It’s also a good idea to inform the respondent how long it typically takes to complete the survey. And let them know if they’ll be able to save their progress and complete the survey later.
Include a survey progress bar and a “save and continue” option
Another way to reassure participants is to include a progress bar. Which shows them how much of the survey is still left to complete. If they can see that they’ll finish soon, they’re less likely to quit early. If it’s not a short survey, add a “save and continue” button. So that they can save their progress and then finish the survey later. Sogolytics surveys include both of these features, both of which encourage greater participation.
Use the appropriate question types
The type of survey you’re conducting should determine the type of questions you ask. If you already have some information about the respondent, you might use a short survey composed only of a few close-ended questions—like sending a brief CSAT survey after an interaction with a long-time customer. However, when you’re trying to dig a little deeper, you will likely need to write a longer survey that contains more open-ended questions. Which allows the participant to elaborate on their responses.
Keep the questions simple
Easily understandable questions increase participation. Use multiple-choice questions—and don’t include too many answer options. Customer satisfaction surveys and net promoter scores are also simple, straightforward ways for customers to rate your business.
Keep the language simple, too
Along those lines, make sure that the way you word your questions is easily comprehensible. Don’t use flowery words, overlong sentences, or technical jargon, which could potentially overwhelm your respondent. Use ordinary, everyday words that all audiences can understand. If you need help simplifying your speech, try hemingwayapp.com. Which gives you a “readability” score and suggests ways to further simplify your language.
Avoid asking leading questions
Your language doesn’t just need to be simple—it also needs to be impartial. You don’t want to accidentally bias your respondent. For example, you wouldn’t want to word a question like, “Which of our product features do you love the most?”. This question assumes that the respondent loves multiple product features—which may not be the case!
Avoid asking double-barreled questions
Another common mistake that you should be careful to avoid is asking double-barreled questions. A double-barreled question asks two questions at once. For example, “how much do price and quality factor into your purchasing decisions?”. That should be two separate questions, one about price and one about quality.
Make your rating scales consistent
If you use multiple rating scale questions, make sure that the scales remain consistent. For example, don’t use a 0-5 rating scale of “very dissatisfied” to “very satisfied” and then switch to a 0-3 scale of “bad” to “good.” Changing the range of scales—or changing the values, so that a 5 is positive for some and negative for others—will confuse survey participants and could lead to inaccurate data.
Arrange questions in a way that makes sense
A well-designed survey should have a natural flow. Group questions that cover the same areas, rather than mixing them all up. You can even create separate sections, which gives your survey a more organized, professional feel.
Use skip logic
A great way to save participants some time is by using skip logic to ensure they’re only presented with relevant questions. Skip logic is a feature on platforms like Sogolytics which changes the questions or pages that a survey participant sees based on how they respond. For example, you might ask a customer whether or not they’ve used a new product feature—if they say “yes,”. They’ll be asked some questions about the feature, but if they answer “no,” they’ll skip ahead to the next section of the survey.
Test out the survey
Even if you follow all of the above tips, there may be a mistake in your survey that you overlooked. Test the survey by sending it out to a group of colleagues who will check to make sure that the questions are well-written and typo-free, and that the survey logic is working correctly.
Distribute the survey in a way that makes sense
Choose a survey distribution method that makes the most sense for your audience. Oftentimes, the option that makes the most sense is distributing your survey via email. But in other cases, you may wish to create a link to the survey that you can share through a variety of channels. Sogolytics even allows you to create a QR code link to surveys, which can be put on printed materials, such as posters, flyers, pamphlets, and more.
Send some reminders to participants who haven’t completed the survey
Most online survey participants complete their survey within the first few days, but there are always some stragglers who fall behind. Be sure to email them reminders that encourage them to complete the survey. You don’t want to be overly aggressive or spammy, but some gentle, periodic reminders can boost your response rate.
Incentivize completing surveys
Struggling with participation rates? Maybe you need to sweeten the pot. If you offer incentives for completing your surveys, you’ll likely reap more responses. Oftentimes, companies will offer participants a special discount, coupon, gift, or another reward if they complete a customer survey.
In conclusion
Creating online a good survey is a crucial step in gathering valuable information for decision-making. By following the top 14 tips outlined in this blog, you can ensure that your survey is well-designed, easy to understand, and results in high-quality responses. These tips include determining the survey’s objectives, using clear and simple language, choosing the right type of questions, testing your survey, and much more.
By considering these key factors, you can create a survey that accurately reflects your needs and provides the insights you need to make informed decisions.
Employment has always been one of the hot topics that most people are concerned about. How to find a good job fast? What kind of job to look for and how to find a job also make job seekers feel very troubled. Fresh graduates, can find jobs faster through campus recruiting. But for non-graduates or other job seekers in society. How to find a job fast and quickly, is an urgent problem that needs to solve.
Here are the articles to explain, job-seeker always want to how to find a good job fast.
Generally speaking, there are still many traditional job-seeking methods, including job-seeking in newspaper areas, job-seeking on bulletin boards, job-seeking at job fairs, etc. But in general, job seekers often spend a certain amount of time and energy, but they get less-than-ideal results. These job-seeking methods all have shortcomings. One is that it is inconvenient to search, and it is impossible to find the position that you need accurately.
The second is that the job information is not comprehensive and timely. The jobs in the newspapers are not timely, and the jobs in the job fair are pretty limited. The third is the poor correlation of information sources. Usually, only one suitable position can see from it, and it is very difficult to find a second suitable position.
Therefore, the more acceptable way to find a job at present is to apply for a job through the Internet. Generally speaking, job seekers can choose some more qualified job recruitment websites, and apply for jobs after selecting their favorite positions. However, you also need to pay attention to checking the company information to avoid being deceived.
When job seekers are looking for a job, they should have some preliminary preparations and planning. So that they can find a job that they satisfy with better and faster.
Best key points;
The following main key point on how to find a good job fast are some tips below. For details, please refer to the following items.
Review your situation and preferences, including education, work experience, hobbies, strengths and weaknesses, the state you want to achieve in the next three to five years, etc.
Lock some positions according to your actual situation and narrow the selection range. For example, some people will focus on marketing, sales, and expansion, while others will focus on administration, personnel, paperwork, and so on.
To make a resume for the position, it does not need to be fancy, but try to highlight its advantages for the job. For example, the sales class should highlight their communication strengths and ability to withstand pressure.
Expand application channels. Including the Internet, newspapers, job fairs, acquaintances, school recommendations, job openings, lectures, headhunting, etc., to give yourself more opportunities.
What is the Importance and Stages of Good Product Design? Every product that stands manufactured by an employer supposes to have a distinguishing bodily attribute. That will make it appealing to customers, this attribute stands regarded as a design. Product design, therefore, is all about manufacturing a product that will entice clients and additionally grant price for them. Since the graph of a product is the first influence a patron has about a precise product. There is consequently the want for agencies to graph merchandise that meet and exceed the customer’s expectations.
Here are the articles to explain, the Importance and Stages of Good Product Design!
This, therefore, the potential that an organization’s most important focal point needs to be to hire skilled operation managers that would graph well-articulated and favored merchandise that will fulfill the desires of clients at all times. Based on this, consequently, the primary goal of this record is to study the product plan by using an explanation. How it is stood influenced by the way of the patron and to additionally exhibit the place it can recognize on the cost chain of an organization.
This file stands written with the resource of tutorial textbooks, journals, and articles and it divides into 5 primary sections. Which are the introduction, and the literature review. The effect of the clients on product design, figuring out product layout on the fee chain, and the conclusion.
Literature Review:
Product design is a very important aspect of any organization and as such this part of the report aims to review comments on product design from various authors. Product design is a means of adding value to a product by ensuring that its layout is attractive to the customer. Also, Product design is all about trying to link customer needs to product attributes, therefore providing the customer with value.
“Good design satisfies customers and communicates the purpose of the product to its market. The objective of a good product design is to satisfy the customer by meeting their actual needs or expectation. This, therefore, enhances the competitiveness of the organization; product design can therefore be seen as starting and ending with the customer. The job of product designers is to achieve designs that exceed customers’ expectations. They also try to design a product that performs well and is reliable during their lifetime, a product should be designed in such a way that it is easy to manufacture. Using design through a business ultimately boots the bottom line by helping to create better products that compete on value rather than price”.
According to Schroeder product design is crucial to the survival of most firms. While a few firms experience little product change, most firm must continually revise their products. Product design is seldom the responsibility of the operations function. But operations exist greatly affected by new product introductions and vice versa. Product design is a prerequisite for production. The result of the product design stands transmitted to operations as product specifications. These specifications state the desired characteristics of the product and allow production to proceed.
Review 01:
Designing new products is a critical capability, particularly as life cycles for products become shorter. New product design must introduce to replace outdated design. According to Chase et al, The design of a product differs depending on the industry; for example for consumer products, understanding consumer preference, market testing and prospective product are very important activities. Companies that specialize in the design of products have highly developed processes to support the activities needed for the industry.
To ensure the proper design of products that will attract customers, a firm must decide what its core competency should be. A core competency is the one thing that the firm can do better than other competitors in the market, with the use of the core competency the firm can design valuable products for example if a firm has a core competency in the manufacturing of mobile phones, it can invest most of its resources into the designing of the more attractive design of mobile phones.
Nigel et al, Further state that good design also helps businesses connect strongly with their customers by anticipating their real needs, this in turn give them the ability to set themselves apart in increasingly tough markets. The use of design in generating new ideas and turning them into realities allows organizations to set the pace in their markets. Bennett et al, The design of a fast-food restaurant, for example, will comprise elements such as scheduling operations, inventory system, quality control, etc.
Review 02:
Hill states that all organizations have a range of products at a given time. To meet up with the competition in the product design market, it is necessary to have a complementary fact, relate to the organization’s strategic decisions associated with issues such as completeness of range, process capability, and distribution costs. New product design is necessary for survival and growth. Hill further stated that there are three important factors to consider during product design. These factors are;
The development and introduction of new product designs are both risky and costly.
The product tends to follow a life cycle.
Some product designs are or have the potential to be more successful than others.
Based on these statements, it is necessary for management to critically analyze ideas before investing in product design.
It is the responsibility of the product designers to ensure that the product satisfies customers. This can achieve through the use of modern technology to design products in line with the trend in technological development. The product should also design to be functional, attractive, have acceptable dimensions, not too noisy, and can maintain. It is also the responsibility of the finance department to demand a product that will generate an adequate return on investment.
Review 03:
The decision made at the design stage of a new product can have a long-term influence on the efficiency of the organization. Product design should stand made in such a way that it is within the budget of the organization. But at the same time meets the expectations of the customers and consumers. This is not usually an easy task because the determinants of quality are frequently difficult to identify.
Supporting the statement above according to Bennet et al. ″Time and cost of manufacture both need to keep to a minimum and the design of any new product should reflect this”. Bennet et al further state that these two aspects are usually closely interdependent. A cheap grade of the material may require slow machining speeds and thus generate high labor costs. And a simple design solution in preference to a complex one may allow the use of unskilled labor rather than skilled workers who stand highly paid. Consequently, a cheap design will not attract customers and as such, there is a need for a more complex design but at a lower cost.
Importance of good product design:
Good product design attracts more customers thereby giving an organization a hedge above other competitors in the market.
It is also important because it brings together three important issues, the concept, the package, and the process.
Good design makes a business grow by enhancing profitability and turnover. Because it transforms the needs of customers into the desired shape and value of the product demanded.
It makes life easy and comfortable for the customer by introducing products that are easy to use.
Good product design is important in replacing obsolete designs.
The stages of product design:
According to Nigel slack et al, fully specified designs rarely spring, fully formed from a designer’s imagination. The design activity passes through several key stages before it gets a final design, this, therefore, forms an approximate sequence. The stages of product design are concept generation, concept screening, preliminary design, evaluation and improvement prototype, and final design.
The first stage of product design develops the concept behind the design; most times ideas from. This stage stands gotten from customers through the use of questionnaires or interviews, or by listening to customers daily based. On their complaints about a product, ideas at this stage stand sometimes also gotten from staff who interact with the customers. The next stage is the concept screening stage whereby the concept stands screened to ensure the addition of a relevant product portfolio that meets the defined concept. This stage also ensures proper screening of ideas by assessing the worth or value of each design option.
The next stage in product design is the preliminary design; this is usually the first attempt at designing the product to ensure that it includes the entire component product. It also involves specifying the components of the product this means specifically outlining the components that will make up the design of the product. The next stage of product design is the evaluation and improvement stage, the purpose of this stage is to examine the preliminary design to find out if it requires any further improvement.
Other Stages:
Nigel et al, outlined three techniques that can be useful in design evaluation and improvement, they are; quality function deployment (QFD), value engineering (VE), and Taguchi methods. The final stage of a product design is the prototype and final design. At this stage, the improved design turns into a prototype for testing. An organization cannot go into the full design without prototype testing. If satisfied with the performance of the product after testing. The final design is then rolled out and displayed for customers and consumers.
It should note that at the beginning of the product design stage. There is a very high level of uncertainty regarding what the final design would look like. This is because there could be several ways in which a concept could translate into a final design. During the stages, all these possible end designs stand successfully eliminated until the end of the process. There is a high level of certainty about what the final design would be like. Various costs affect the design stages.
The more the changes in the design stages, the higher the cost of design, it is important that as organizations try to design attractive products for their customers there is also the need to watch the cost level because a higher level of product design cost will affect the organizations turnover, so if an organization intend to design a more sophisticated product, it should, first of all, calculate the returns it would get from such a product.
The five stages of product design can narrow down into three stages as explained below, these stages are;
The concepts:
This defines as a clear outline or specification which includes the use and value of the product. Which can use to assess the stages of the design. It means understanding the nature, use, and value of the products.
The package:
This provides the benefits defined in the concept and stands made up of the core and supporting products. The cores are the items that are fundamental to the purchase and cannot remove without destroying the nature of the package. The other parts serve to enhance the core, and these are the supporting products. According to Nigel et al, the core good is the car. While the leather seats and guarantee are the supporting goods.
By changing the core, or adding and subtracting supporting goods, organizations can provide packages and create a quite different concept. Finch, the design of a product and the process that produce them cannot be completely independent. The design of a product determines the type of process used to create it. This perspective has guided process design for decades. Recently products have stood designed with the view that product design can make a process simpler and less costly.
The process:
This is the method by which the product will create and delivered. The process is the various activities that take place from the beginning to the end of the assembly line. When the product stands delivered to the customer or the showroom. The packages of components which make up a product are the ingredients of the design. Nigel et al, further state that producing design for products is a process that conforms to the input transformation output model.
Therefore it has to design and managed like another process. It is important to note that although organizations strive to produce an attractive design of products. This desire is most affected or influenced by the availability of materials and hi-technology.
The Influence of a Customer on Product Design and a Business Perspective:
A well-designed product makes a great difference to a customer’s perception of the product. And certain factors influence the decision of a customer about the design of a particular product. These factors are the value attributes, they stand for the value perceived by a customer. These are what the customer considers before, deciding to buy a product, these factors are; convenience, cost, technology quality, style/fashion.
The design of a product to a large extent influences the decision of a customer to buy the product. For example, the newly designed touch screen phones introduced by almost all mobile phone manufacturers have increased. Their turnover is because it is easy and convenient to use. So it can be said that one of the factors that influence the customer concerning product design is how convenient and easy the design is to the customer.
Influence Part 01:
Another factor that can influence a customer is cost, the cost of a well-designed product is sometimes too expensive for a customer. And thereby the customer may either decide to buy it or choose an alternative with a lesser design to save cost. On the other hand, from the business perspective, a well-designed product will increase turnover. But the cost of manufacturing will be high.
Sometimes an organization can create a cost advantage either by reducing the cost of the individual value chain activities or redesigning the product. Redesigning means, changing some aspects of the design. So that it can manufacture at a lower cost. Technology is another factor that influences customer perception of a product design. The need for modern technology can influence a customer’s perception of a product. And therefore influence the decision to buy or not buy a particular product just because its design does not meet the customer’s expectation.
For example, the introduction of Windows 7 by the Microsoft corporation will encourage customers to buy laptop computers that have this application rather than buying one without windows 7, because Windows 7 is a more sophisticated and modern technology and customers will prefer it to an outdated version of the same computer, this means that the introduction of modern technology or application into a product design will enable the organization sell more and increase its turnover.
Influence Part 02:
Quality with stands also known as fitness for a purpose is also a factor. That can influence the customer about product design. Improved quality of a product design can further attract customers. This involves the use of high-quality materials in the product design process. The outcome of this is that the product will well designed and durable. Therefore the customer will be willing to pay more and have a product. That has a longer life span and can withstand adverse weather conditions rather than buying a low-quality product that will not serve its purpose.
For example, a company that manufactures shoes like Clarks may decide to use high-quality leather skin in its product design process. This will lead to the production of quality shoes which has good weather-resistant, which will attract customers. Style and fashion is also a value attribute to customers’ perception of product design. Because the latest changes in style and fashion around the globe will seriously influence a customer. To ensure that organization’s products are attractive to customers, there must be a constant change in the design of products.
This means that the organization should endeavor to produce goods that follow the trends of current style and fashion, this attribute is normally feasible in the cloth industry and the target market should be the youths who are fashion crazy, a typical example would be George a subsidiary of ASDA, in the Wal-Mart family, George will increase its turnover if it can produce clothes that meet with the latest and current standard of style and fashion.
What is Good Product Design? Importance and Stages; Photo by Alvaro Reyes on Unsplash.
Reference;
It is Retrieved from https://www.ukessays.com/essays/marketing/importance-of-good-product-design-marketing-essay.php?vref=1
Image Source from https://unsplash.com/photos/KxVlKiqQObU
Sale of Goods Act 1979, under Sections 12, 13, 14, 15Essay, Summary, and History. What is the Sale of Goods Act? This act calls for goods to be as defined, of exceptional nice, and match for the cause. Fit for motive approach each for their normal reason, and additionally, any particular purpose which you agreed with the vendor (as an example, in case you especially asked for a printer that might like-mind along with your computer or wall tiles that might be appropriate to use in a restroom).
Here is the article to explain, Essay, Summary, and History of Sale of Goods Act 1979, under Sections 12, 13, 14, and 15!
Goods sold must additionally healthy any pattern you provided in-store or any description in a brochure. The best time goods don’t require to be quality high-quality is if an illness or difficulty becomes especially drawn for your interest earlier than you purchased them. So, in case you tested the goods and could observe (however did not do so) that they have been no longer of first-class quality. Or, in the case of sale by sample, if the lack of excellent would have been obvious on an inexpensive examination of the sample, you would no longer be capable of arguing that the goods have been not of excellent pleasant.
Introduction;
This summary examines the Sale of Goods Act 1979 (“the Act”) within its context: why it existed and drafted. What are its important provisions, and how it has changed since it came into force? More to know Antitrust Law Case Study. It submitted that the Sale of Goods Act 1979 has been part of a change in consumer dealings, with its most significant contributions being to the rights consumers have when they buy products that turn out to be faulty. Indeed, its use has been so central to implied terms in particular, that one author criticized for failing to see the contribution of the Act to the law of implied terms. At the same time, the Act’s importance has to an extent been diminished by the introduction of very recent legislation.
The rationale for Drafting;
The Act codified various provisions, such as the formation of a contract. Which was already prevalent and well-established in the common law. However, its contribution was to enhance consumer confidence. It argued that without the Act, and its successors, there would be little protection for consumers. This imbalance of consumer rights would lead to significant caution and even “defensive consumerism”.
If consumers believe they have few rights when purchasing goods, then they are slow to trust newer and less-familiar brands and will continue to buy goods from established brands, even where those goods lack quality. Therefore, if the legislature does not guarantee certain minimums for consumer confidence, competition would suffer. In summary, the Act stood brought about due to a concern for protecting consumer rights. Thereby promoting consumer confidence and increasing competition amongst producers.
Provisions of Note;
The Act was recognized for its contribution to the law of implied terms. Sections 12, 13, 14, and 15 guide the existence and scope of implied terms relating to title, quality, sale by description, and sale by sample. It submitted these sections are central to any considerations about implied terms.
Section 14;
It is important because of its use of several concepts. First, it implies several terms in all contracts, those terms being that the goods are of satisfactory quality. Which is evaluated by reference to the “state and condition” of the goods? Second, the section contains an important proviso: the terms only imply when the sale conducts “in the course of a business.” The “valuable decision” of MacDonald v Pollock – a Scottish case which nevertheless provides important guidance for applying the Act across the UK – has recognized this section to have far-reaching consequences for business-to-consumer and business-to-business transactions, because the definition of a business is now a material issue.
Section 15A;
It refers to remedies for breach of conditions in non-consumer cases. This section says a buyer may claim for breach of warranty, but not repudiate a contract, where “the breach is so slight it would be unreasonable for [the buyer] to reject [the goods].” This section has been argued as “central to elements of commercial practice” – as in one case – to concepts of description, condition, and rejection.
The Act makes other specific additions to contract law designed to protect specific consumers. Section 3 of the Act gives detail about “necessaries” purchased by a minor. According to that section, necessaries – defined as “goods suitable to the condition in life of the minor and to his actual requirements at the time of sale and delivery” – must sell/purchase at a “reasonable” price. That section also requires a reasonable price must pay by a person who “because of drunkenness is incompetent to contract.”
In conclusion, it submitted that the Act has codified the law, and provided guidance on various miscellaneous issues. And has been most significant for its contributions to consumer protection and commercial practice through implied terms.
Redefined and Repealed;
First, the Act and its place in consumer dealings stood further expanded on by subsequent legislation, in particular the Unfair Terms in Consumer Contracts Regulations 1999. These Regulations have added “to the consternation of UK lawyers”, the requirement by businesses to show good faith. This is a form of dealing which often seen in Continental European jurisdictions. But much less often in English law, which has “freedom of contract” as its object. Due to it not being part of English jurisprudence, the concept of good faith “remains early”. Nevertheless, these legislative developments have been accommodated, if only to some extent. Because of the detail given by the Act to implied terms.
Scope;
The Act has also been recently subjected to a reduction in its scope. The Consumer Rights Act 2015 (“the 2015 Act”). Which came into force in October 2015, and repealed a significant portion of the Act. The Act formerly had provisions relating to unfair terms of the contract in dealings vis-à-vis consumers and businesses. All of those provisions have now been repealed and replaced by the 2015 Act. Importantly, the 2015 Act has enshrined consumer protections relating to digital content.
On the one hand, these changes are significant: the 2015 Act has introduced these protections. Because of issues relating to digital content, such as methods of delivery to smartphones. And the purchase of apps lived not envisaged at the time of the Sale of Goods Act. To a degree, therefore, the 1979 Act retains stood superseded. However, the Act still provides important concepts: the 2015 Act has principles of quality. And fitness for purpose is very similar to the 1979 Act. Therefore, the Act continues to be relevant.
Conclusion;
It submitted the Act has been part of and has helped to develop consumer protection. It has been part of an effort to boost competition by giving consumers certain assurances about their rights when purchasing from businesses (hence why the definition of a “business” is such an important issue). To an extent, subsequent developments have introduced concepts to consumer-to-business dealings that existed not envisaged in the Act. Nevertheless, it submitted these developments were only possible, at least in part, due to the foundations of the Act and its provisions relating to implied terms.
Sale of Goods Act 1979 Sections 12 13 14 15 Essay; Photo by Pixabay from Pexels.
References; Sale of Goods Act 1979. Retrieved from https://www.lawteacher.net/acts/sale-of-goods-act-1979.php?vref=1
Positive, Good, Negative, and Bad impacts or effects of Globalization on Economy; Globalization makes business management easier and efficient for the company. Based on my research, Globalization simplifies business management in the world. This is due to the advancement in technology, transport, communication, education, and regulations of trade that makes trade fair to all parties. This attracts more people to engage in international business and international trade. Managers within the global face a lot of challenges due to high competition in the industry; good decisions must make to satisfy and maintain their customers and attract more customers for their products.
Here is the article to explain, What are the Positive, Good, Negative, and Bad impacts or effects of Globalization on Economy?
Companies enjoy economies of scale in the business due to the reduction of cost in the management. This report explores a range of interlinking questions, starting with what is globalization, what are the impacts or effects of globalization in developing countries and developed countries, this is in terms of positive and negative impacts or effects on the economy. Globalization is something that affects all of us, no matter what our profession or interest is.
Globalization is a very wide and very important focus of discussion. I spent time researching what it is and the effects it has in developed countries and developing countries. So in this report, I will define what globalization is and the effects according based on my research. Globalization despite having benefits to the world also has negative impacts or effects of it.
The following Positive, Good, Negative, and Bad impacts or effects of Globalization on the Economy below are;
Globalisation has brought benefits in developed countries as well as negative impacts or effects, while positive. The positive impacts or effects include several factors which are education, trade, technology, competition, investments and capital flows, employment, culture, and organization structure.
Positive impacts or effects;
It would be rather difficult to discuss the extent of the positives that globalization has had on the world at large. But still, here are some of the positive impacts or effects of globalisation and the negative impacts or effects they have had on so many demographic segments of society.
Global market.
Most successful emerging markets in developed countries are a result of the privatization of state-owned industries. For these industries to increase consumer demand many of them are attempting to expand and extend their value chain to an international level. The impact of globalization on business management see by the sudden increase in the number of transactions across the borders.
In protecting yields and maintaining competitiveness, businesses are continuing to develop a wide range of their footprint as it lowers cost and enjoys economies of scale. Multinational corporations are a result of globalization. They occupy a central role within the process of globalization as evidenced through global foreign direct investment inflows.
Their concentrations within Europe in western economies have led to size constraints, therefore there is a need for new geographical areas to operate whereby they will face a lot of competition in the market. Through this they will enlarge their market and enjoy economies of scale as globalization facilitates time-space compression, economies compete at all levels including that of attracting investors.
Cross-cultural management.
Globalization tends to be the realm of the elite because in many parts of the world they are the only people who are affluent enough to buy many of the products available in the global marketplace. Highly educated and wealthy people from different backgrounds interact within a westernized milieu. Western styles, since are symbols of affluence and power, the elite often embraces western styles of products and patterns of behavior to impress others.
Today Western culture and patterns of behavior and language are staples of international business. United states have a powerful impact upon many other countries and societies. The world today has a popular cultural force. The popular consumer culture of the economically dominant West is relentlessly and inevitably transforming other regions, cultures, nations, and societies.
In addition, such perspective implies that technological change, mass media, and consumer-oriented marketing campaigns work in tandem to remake whatever they touch in their image. Even attitudes and ideas about society, religion and, technology transformed by cultural diffusion brought by globalization. For example, in America McDonalds, represent fast, cheap,p and convenient food while it is not the same worldwide. It’s of high price in other countries like China and Russia where it involves cultural experience.
Foreign trade.
Globalization has created and expanded foreign trade in the world. Things that were only found in developed countries can now be found in other countries across the world. People can now get whatever they want and from any country. Through this developed countries can export their goods to other countries. Countries do business through international trade, whereby they import and export goods across the globe. These countries that export goods get comparative advantages.
Organizations have been established to control and regulate the trade activities of the countries in the world to have fair trade. World trade organizations emerged a powerful international or organizations able to effectively influence individual governments to follow international trade rules, copyrights, policies on subsidies, taxes, and tariffs. Nations can not break rules without facing economic consequences. The number of nations that are dependent on trade, foreign capital, and the world financial markets increased greatly.
Countries engaged in foreign trade enjoy a comparative advantage. The post-Recardianan trade theories predicted that specialization in labor and capital-intensive goods would bridge enormous wage gaps between the poor and the rich countries, that is the developing and developed countries, sparing the latter from massive labor immigration.
Resource Imperative.
Developed countries need the natural and human resources of the developing countries while developing countries need the capital, techno, logy, and brainpower of the wealthier countries. Developed countries’ economies are increasingly dependent on the natural and human resources of developing nations. The growing interdependence of nations and their activities on one another fosters by the depletion of natural resources; as well as overpopulation.
Foreign investment.
One of the most visible positive impacts or effects of globalization in India is the flow of foreign capital. A lot of companies have directly invested in India, by starting production units in India, but what we also need to see is the amount of Foreign Investment Inflow that flows into the developing countries. Indian companies which have been performing well, both in India and off the shores, will attract a lot of foreign investment, and thus pushes up the reserve of foreign exchange available in India.
This is also one of the positive impacts or effects of globalization in the US and other developed countries as developing countries give them a good investment proposition. Managers’ objectives might not be the same as those of stockholders in some situations. The more complex the corporation the more difficult it is for shareholders to monitor management’s actions whereby it provides the managers more freedom to act in their self-interest at the expense of shareholders.
Multinational firms are more complex than national firms. Managers might favor international diversification because it reduces firm-specific risk or adds to their prestige. These goals might be of little interest to shareholders. This divergence of interests between shareholders and managers might reduce the value of multinationals relative to domestic firms.
Competition.
One of the most visible positive impacts or effects of globalization is the improved quality of products due to global competition. Customer service and the ‘customer is the king’ approaches to production have led to improved quality of products and services. As domestic companies have to fight out foreign competition; they compel to raise their standards and customer satisfaction levels to survive in the market. Besides, when a global brand enters a new country, it comes in riding on some goodwill, which it has to live up to. This creates competition in the market and a survival of the fittest situation.
Culture.
The positive impacts or effects of globalization on culture are many! Not all good practices were born in one civilization. The world that we live in today is a result of several cultures coming together. People of one culture, if receptive, tend to see the flaws in their culture and pick up the culture which is more correct or in tune with the times.
Societies have become larger as they have welcomed people of other civilizations and backgrounds and created a whole new culture of their own. Cooking styles, languages, and customs have spread all due to globalization. The same can say about movies, musical styles, and other art forms. They too have moved from one country to another, leaving an impression on a culture that has adopted them.
Legal Effects.
Increased media coverage draws the attention of the world to human rights violations. This leads to improvement in human rights. Global economic growth does not necessarily make people happier, worldwide free trade should also benefit humanity as well as protect nature, not just reward managers and stockholders. Those who would be authentic leaders need to address inequalities.
Globalization should promote openness and information along with exchange with greater democracy and prosperity. Gone are the days where the limited jurisdiction became a hindrance in the prosecution of criminals. These days due to international courts of justice, these criminals can no longer seek asylum in a foreign country but will be brought forward and there will be justice.
Due to globalization, there is also an understanding between the security agencies and the police of two or more different countries who will come together to curb global terrorism. Hence, it is now possible to catch the perpetrators of crime irrespective of which country they choose to hide in. This is undoubtedly one of the greatest positive, good, negative, and bad impacts or effects of globalization on society or the economy.
Negative impacts or effects;
Globalization also has its side effects on developed nations. These include some factors which are jobs insecurity, fluctuation in prices, terrorism, fluctuation in currency, capital flows, and so on.
Jobs Insecurity.
In developed countries, people have jobs insecurity. People are losing their jobs. Developed nations have outsourced manufacturing and white-collar jobs. That means fewer jobs for their people. This is because the manufacturing work is outsourced to countries; where the costs of manufacturing goods and wages are lower than in their countries. They have outsourced to developing countries like China and India.
Most people like accountants, programmers, editors,s, and scientists have lost jobs due to outsourcing to cheaper locations like India. Globalization has led to the exploitation of labor. Safety standards are ignored to produce cheap goods. “In practice, however, the recent experience in Latin America has been that many such open-handed multinationals moved their operations too; for example, China or South East Asia because of cost and market considerations”.
Fluctuation in Prices.
Globalization has led to a fluctuation in price. Due to the increase in competition, developed countries are forced to lower down; their prices for their products, this is because other countries like China produce goods at a lower cost; making goods to be cheaper than the ones produced in developed countries. So, for the developed countries to maintain their customers they are, forced to reduce the prices of their goods. This is a disadvantage to them because it reduces the ability to sustain social welfare in their countries.
Positive, Good, Negative, and Bad impacts or effects of Globalization on Economy; Image by Fathromi Ramdlon from Pixabay.
References; Positive and Negative effects of Globalization. Retrieved from https://www.ukessays.com/essays/economics/positive-and-negative-effects-of-globalisation-for-business-economics-essay.php?vref=1
Capital Goods and/vs Consumer Goods terms use to explain goods based totally on how they may use also study their distinction or difference. A capital is suitable for any suitable use to help grow future production. Consumer items are the ones utilize by purchasers and have no destiny efficient use. The equal physical excellent may be either a client or capital excellent, relying on how the best use. An apple bought at a grocery keep and without delay eaten is a customer properly. An identical apple sold by way of an organization to make apple juice is capital properly. The distinction lies inside the apple’s utilization.
Here is the article to explain, Distinction or difference between Consumer Goods and/Vs Capital Goods!
In economics, items are matters that could fulfill human wishes and desires. Goods take into consideration as one’s commodities that are capable of pleasant human needs and desires. There are number one classifications of products, i.E. Consumer items, and capital goods. Primarily in cutting-edge economics, there are 2 kinds of goods: Consumer goods and Capital goods.
Consumer goods define as consumable items which do no longer want in addition to processing. Consumers are also able to use or devour those goods at once. For example snacks, bread, mineral water, toothpaste, shampoo, espresso, cookies, tea, and many extras.
Capital goods are those goods that need in addition processing and generally go to manufacturing from producers. They normally are available in large quantities and examples encompass commodities along with wooden, log, gold, and half of-raw materials. People generally shop them in inventory or warehouse as stock for additional processing or funding.
Consumer items are described as the products which can use for final consumption, i.E. The products that aren’t used for further processing. On the other hand, capital goods are those goods that can use for destiny manufacturing through the producers, as opposed to via the consumers for very last use. The line of demarcation amidst those two kinds of goods may be very skinny and blur. The only point that bureaucracy is a base for the distinction between client goods and capital goods is their use.
What is Consumer Goods?
In Economics, each tangible product or commodity this produces to satisfy and fulfill market wishes know as a Consumer item. It may also categorize into three types together with long-lasting items, nondurable goods, and offerings.
Durable goods are normally having a considerable lifestyles span, frequently three years or more like a battery, far-flung management, furniture, and maximum likely electronics. While non-durable items will expire in a depend on months to 1 year or 12 months which include food and liquids, garments, soap, and matters that house-chores want.
Some people may think that services aren’t part of client items however that isn’t real. Consumer-going through offerings are intangible products or actions consumed concurrently. Examples of those consist of haircuts, vehicle restore, landscaping, sales advertising and marketing, and home or web designing.
Definition of Consumer Goods:
Consumer goods, additionally referred to as final goods, are tangible items that might gears up for intake or purchased via people or families for final consumption to meet their needs. They are in addition sub-divided into long-lasting goods, nondurable goods, and offerings.
Consumer items encompass the one’s products of our daily desires like meals products (e.G. Veggies, eggs, cooking oil, grains, etc), household home equipment, digital items, furnishings, and cleaning merchandise.
What are Capital Goods?
Meanwhile, Consumer items end after transport to the give up-person, Capital items still need to process earlier than they can use. The person of capital goods is commonly the opposite corporation that later will produce consumer goods (that is what we known as a commercial enterprise to business B2B). There are three forms of Capital items: Property, Plant, and Equipment (fixed asset).
Examples of Capital goods are buildings, factories, machinery, cars, etc. And examples of Capital items used for a provider commercial enterprise are a hair mask utilized by hairstylists, a computer used by an internet fashion designer, and many others. Like Consumer goods, capital goods also classifies as tangible belongings, due to the fact they can measure, have financial value, and commonly have a physical form.
Definition of Capital Goods:
Capital goods, alternately known as intermediate or manufacturer items, are the products that deploy by the organization as input within the manufacturing of patron goods and offerings, together with plant and equipment, system, fixtures, vehicles, office constructing.
The buy of capital goods is a critical expense for corporations as they require large capital investment, whose gain receives over time. Moreover, those goods depreciate over their life years and so, the enterprise can claim a partial tax deduction for this reason.
Main Key Differences Between Consumer Goods and/vs Capital Goods:
The great differences between customer goods and capital items mention as underneath:
Consumer items define as the products used by the give up-consumer for intake. Capital items goods deploye to provide consumer goods.
Business to Consumer (B2C) advertising and marketing use to promote patron items while the marketing approach used to sell capital items is Business to Business (B2B) advertising and marketing.
Consumer goods mainly offer for personal consumption. On the opposite, capital items purchase to generate other merchandise.
Capital items goods utilize by one commercial enterprise to help some other enterprises produce customer goods.
Consumer goods utilize by clients and haven’t any future efficient use.
Capital goods include items like buildings, machinery, and gear.
Examples of patron goods consist of meals, home equipment, clothing, and vehicles.
Consumers buy patron goods. As in opposition to this, the shoppers of capital items are manufacturers.
As the purchaser goods without delay fulfill the needs of consumers; so that they have a direct call for. As hostile, capital goods satisfy the patron desires not directly; so they have derived demand.
Suppliers determine the rate of client items. Conversely, organizations set the charge of capital goods.
While consumer items mean for the very last intake, capital items worry about the very last investment.
Conclusion:
After reviewing the above points, it is pretty clear that client items are in lots of ways extraordinary from capital items. Although if you take a look at the opposite side of the coin; you may come to realize that capital goods and customer items both are the same; it’s miles most effective the reason they may use for, makes them specific.
To understand this, permit’s take an example of mangoes; if the mangoes are purchased for consumption purposes, then it’s far stated to be consumer appropriate. Conversely, if the purchase of mangoes is for making juice and then reselling it, then it is said to be a capital top.
Consumer goods and capital goods are two different things but the very last product comes in the hand of customers. Consumer goods in phrases of chain glide and marketplace are a great deal better than capital items due to their usage and call for.
The Consumer items are clean to attain by purchasers but capital items are meant to process first earlier than being eaten up. Consumer goods are tangible merchandise that has the main use to satisfy modern wishes; whilst capital goods are not to be fed on immediately but purchased to make other consumable merchandise.
When it comes to sturdiness, capital goods are having a longer life span and mainly emerge as funding even as client goods are relatively short due to personal use purposes. In any financial system, some fluctuations immediately affect the marketplace rate and glide. Consumer goods commonly observe the tides at the same time as capital goods are comparatively stable and have a tendency to get better over the years.
Distinction or difference between Consumer Goods and/Vs Capital Goods; Image by PublicDomainPictures from Pixabay.
What does Preference Shares mean?Preference Shares, as its name suggests, gets precedence over equity shares on the matters like distribution of dividend at a fixed rate and repayment of capital in the event of liquidation of the company. Preference shares are one of the important sources of hybrid financing. As the name suggests, these have certain preferences as compared to other types of shares. These shares are given two preferences. There is a preference for payment of dividend. Whenever the company has distributable profits, the dividend is first paid on preference share capital.
Know and Understand the Preference Shares.
The content of study from Preferred Shares: Explanation of Preference Shares, Features of Preference Shares, Good and Bad of Preferred Shares (Advantages and Disadvantages of Preference Shares).
The preference shareholders are also the part owners of the company like equity shareholders, but in general, they do not have voting rights. However, they get right to vote on the matters which directly affect their rights like the resolution of winding up of the company, or in the case of the reduction of capital.
Other shareholders are paid a dividend only out of the remaining profits if any. The second preference for shares is repayment of capital at the time of liquidation of the company. After payment of outside creditors, preference share capital is returned. Equity shareholders will be paid only when preference share capital is paid in full.
Explanation of Preference Shares.
They are those shares which carry certain special or priority rights. Firstly, the dividend at a fixed rate is payable on these shares before any dividend is paid on equity shares. Secondly, at the time of winding up of the company, capital is repaid to preference shareholders prior to the return of equity capital. Preferred Shares do not carry voting rights. However, holders of preferred shares may claim voting rights if the dividends are not paid for two years or more on cumulative preference shares and three years or more on non-cumulative preferred shares.
Meaning of Preference Shares.
The share which entitles the holder to a fixed dividend, whose payment takes priority over that of ordinary share dividends. Preferred Shares are one of the important sources of hybrid financing. It is hybrid security because it has some features of equity shares as well as some features of debentures. The holders of preference shares enjoy the preferential rights with regard to receiving of dividend and getting back of capital in case the company winds-up.
Definition of Preference Shares.
They are a long-term source of finance for a company. They are neither completely similar to equity nor equivalent to debt. The law treats them as shares but they have elements of both equity shares and debt. For this reason, they are also called “Hybrid financing instruments”. These are also known as preferred stock, preferred shares, or only preferred’s in a different part of the world.
Features of Preference Shares.
They have the characteristics of both equity shares and debentures. Like equity shares, dividend on preferred shares is payable only when there are profits and at the discretion of the Board of Directors.
Preferred Shares are similar to debentures in the sense that the rate of dividend is fixed and preference shareholders do not generally enjoy voting rights. Therefore, they are a hybrid form of financing.
The features of preference shares are listed below:
Dividends.
They have dividend provisions which are cumulative or non- cumulative. Most shares have the cumulative provisions, which mean that any dividend not paid by the company accumulates. Normally, the firm must pay these unpaid dividends prior to the payment of dividends on the common stock. These unpaid dividends are known as dividends in arrears or arrearages. Non-cumulative dividends do not accumulate if they are not paid when due.
An investor contemplating the purchase of preferred shares with a non-cumulative dividend provision needs to be especially diligent in the investigation of the company because of the investor’s potentially weak position vis-a-vis those preference shares with a cumulative dividend provision. In the case of cumulative preferred shares, even if the arrears of the preference dividend are cleared in full, the investor would be the loser as he is to get less in net worth.
Participating.
Most they are non-participating, meaning that the preference shareholder receives only his stated dividend and no more. The theory is that the preference shareholder has surrendered claim to the residual earnings of his company in return for the right to receive his dividend before dividends are paid to common shareholders.
The participating preference shareholder receives stipulated dividend and shares additional earnings with the common shareholders. But this share is usually non-cumulative which confirms the view that preference share does have both protective and profit participating provisions.
Voting Rights.
They do not normally confer voting rights. The basis for not allowing the preference shareholder to vote is that the preference shareholder is in a relatively secure position and, therefore, should have no right to vote except in the special circumstances.
The cumulative preferred shares can vote if their dividend is in arrears for 2 years. The voting right of each preference shareholder is to be in the proportion which the paid-up share capital on his shares bears to the total equity share capital of the company.
Par Value.
Most they have a par value. When it does, the dividend rights and call price are usually stated in terms of the par value. However, those rights would be specified even if there were no par value. It seems, therefore, as with equity shares, the preference share that has a par value has no real advantage over preference share that has no par value.
Redeemable or Callable.
Typically, they have no maturity date. In this respect, it is similar to equity shares. Redeemable or callable preferred shares may be retired by the issuing company upon the payment of a definite price stated in the investment. Although the “call price” provides for the payment of a premium, the provision is more advantageous to the corporation than to the investor.
When money rates decline, the corporation is likely to call in its preferred shares and refinance it at a lower dividend rate. When money rates rise, the value of the preference shares declines so as to produce higher yield, the call price acts as an upper peg or plateau through which the price will break only in a very strong market.
Non-callable preferred shares and bonds are issued in periods of High-interest rates. The issue is barred from redeeming them later in the event of generally falling yields or for a certain period so the investor has important protection against declining income.
Preference Shares: Explanation, Features, Good and Bad, #Pixabay.
Advantages of Preference Shares:
The following advantages of preference shares are:
The obligation for Dividends:
No Obligation for Dividends; A company is not bound to pay the dividend on preference shares if its profits in a particular year are insufficient. It can postpone the dividend in case of cumulative preferred shares also. No fixed burden is created on its finances.
Interference:
No Interference; Generally, they do not carry voting rights. Therefore, a company can raise capital without dilution of control. Equity shareholders retain exclusive control over the company.
Trading on Equity:
The rate of dividend on they are fixed. Therefore, with the rise in its earnings, the company can provide the benefits of trading on equity to the equity shareholders.
Flexibility:
A company can issue redeemable preference shares for a fixed period. The capital can be repaid when it is no longer required in business. There is no danger of over-capitalization and the capital structure remains elastic.
Variety:
Different types of preference shares can be issued depending on the needs of investors. Participating preferred shares or convertible they may be issued to attract bold and enterprising investors.
They can be made more popular by giving special rights and privileges such as voting rights, right of conversion into equity shares, right of shares in profits and redemption at a premium.
Disadvantages of Preference Shares:
They suffer from the following disadvantages:
Obligation:
Fixed Obligation; The dividend on preferred shares has to be paid at a fixed rate and before any dividend is paid on equity shares. The burden is greater in the case of cumulative preference shares on which accumulated arrears of dividend have to be paid.
Appeal:
Limited Appeal; Bold investors do not like preferred shares. Cautious and conservative investors prefer debentures and government securities. In order to attract sufficient investors, a company may have to offer a higher rate of dividend on preference shares.
Return Earning:
Low Return in this shares; When the earnings of the company are high, fixed dividend on they becomes unattractive. Preference shareholders generally do not have the right to participate in the prosperity of the company.
Voting Rights:
No Voting Rights; They generally do not carry voting rights. As a result, preference shareholders are helpless and have no say in the management and control of the company.
Fear of Redemption:
The holders of redeemable preference shares might have contributed finance when the company was badly in need of funds. But the company may refund their money whenever the money market is favorable. Despite the fact that they stood by the company in its hour of need, they are shown the door unceremoniously.
Learn and Understand, What are Advantages and Disadvantages of GST?
Implementation of Goods and Services Tax (GST) was one of the long-awaited fiscal reform and due to various reasons it was only hanging around and could not circumvent the obstacles for the substantially long period of time so much so that people started saying that the reform may not see a light of the day. At this juncture, we need to understand that GST could eventually become a reality only because of the various advantages it brought along. Of course, no reform can be full proof and so is GST and therefore the implementation of GST had its own disadvantages with few being inherent and intrinsic to the idea of GST, few due to the structure in which it is brought and a lot is due to the manner in which it is implemented which could have been largely avoided. Also learn, Benefits of GST, What are Advantages and Disadvantages of GST?
While we take a stock of GST as of today, we need to acknowledge the efforts taken by the government in making it much simpler from the time first model GST code was released in June 2016 to today when we are at the brisk of 200 days post its implementation. While we take a deeper dive into understanding the advantages and disadvantages of GST, we need to appreciate the fact that this being a transactional tax its advantages and disadvantages cannot be equated for all. For instance, it is possible that one sector or industry is largely benefitted due to the implementation of GST while other sector or industry has taken the exact opposite position. The point that we need to take home is that many advantages and disadvantages of GST can be closely understood only when its impact is measured industry or sector wise.
The list of advantages and disadvantages of GST can be very long, but herein we look at some of the major ones as explained below:
The Advantages of GST (Goods and Services Tax):
Boosts Foreign Investment and improves the overall investment climate.
Single assessing authority.
Increased certainty/ Reduced litigation.
Erosion of parallel economy.
Reduced corruption.
Downslide of prices.
Common national market throughout the country, and.
Increase in employment opportunities.
The Disadvantages of GST (Goods and Services Tax):
Not a one nation one tax in spirit.
Multiple Tax rates.
GST Portal issues.
Hurried implementation of the Law.
Working capital blockage.
High compliance burden.
Elimination of local tax incentives/ schemes, and.
Learn, How, What is it, Do you Know Benefits of GST (Goods and Services Tax)?
GST stands for Goods and Services Tax which will be levied on the supply of goods or services or both in India. GST will subsume a number of existing indirect taxes being levied by the Centre and State Governments including Central Excise duty, Service Tax, VAT, Purchase Tax, Central Sales Tax, Entry Tax, Local Body Taxes, Octroi, Luxury Tax, etc. Also learn, GST, PDF, Do you Know Benefits of GST (Goods and Services Tax)?
It brings benefits to all the stakeholders’ viz. industry, government and the citizens. It is expected to lower the cost of goods and services, boost the economy and make our products and services globally competitive. GST aims to make India a common national market with uniform tax rates and procedures and removes the economic barriers, thereby paving the way for an integrated economy at the national level. By subsuming most of the Central and State indirect taxes into a single tax and by allowing a set-off of prior-stage taxes for the transactions across the entire value chain, GST would mitigate the ill effects of cascading and thereby improve our competitiveness.
GST or Goods and Service Tax is common tax system proposed by the government. As the name suggests it is a common tax for Goods and Services. In simple words today we are paying multiple taxes such as excise duty, customs duty, value added tax, octroi, service tax etc.
The Benefits of Goods and Services Tax (GST):
Elimination of Multiple Taxes:
The biggest benefit of GST is an elimination of multiple indirect taxes. All taxes that currently exist will not be in the picture. This means current taxes like excise, octroi, sales tax, CENVAT, Service tax, turnover tax etc will not be applicable and all that will fall under common tax called as GST.
Saving More Money:
For a common man, GST applicability means the elimination of double charging in the system. This will reduce the price of goods and services & help common man for saving more money. It is expected that price of FMCG products, small cars, cinema tickets, electrical wires etc is expected to reduce.
Ease of business:
GST will bring one country one tax concept. This will prevent unhealthy competition among states. It will be beneficial to do interstate business.
Easy Tax Filing and Documentation:
For a businessman, GST will be a boon. No multiple taxes means compliance and documentation will be easy. Return filing, tax payment, and refund process will easy and hassle-free.
Cascading Effect reduction:
GST will be applicable at all stages from manufacturing to consumption. GST will provide tax credit benefit at every stage in the chain. Today at every stage margin is added and tax is paid on the whole amount, in GST you will have tax credit benefit and tax will be paid on margin amount only. It will reduce cascading effect of tax thereby reducing the cost of the product.
More Employment:
As GST will reduce the cost of producing it is expected that demand for the product will increase and to meet the demand, supply has to go up. The requirement of more supply will be addressed by only increasing employment.
Increase in GDP:
As demand will grow naturally production will grow and hence it will increase gross domestic product. It is estimated that GDP will grow by 1-2% due to GST.
Reduction in Tax Evasion:
GST is a single tax which will include various taxes, making the system efficiency with very little chances of corruption and Tax Evasion.
More Competitive Product:
As GST will address cascading effect of the tax, inter-state tax, high logistics cost it will make manufacturing more competitive. This will bring advantage to businessman and consumer.
Increase in Revenue:
GST will replace all 17 indirect taxes with the single tax. Increase in product demand will ultimately increase tax revenue for state and central government.
Goods and service tax is a boon for the Indian economy and the common man. It is a welcome step taken by the government.
Learn and Understand, What is GST (Goods and Services Tax)?
First, take analysis GST Full Form is Goods and Services Tax. The Goods and Services Tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption. The GST is paid by consumers, but it is remitted to the government by the businesses selling the goods and services. In effect, GST provides revenue for the government. Also learn, the Concept of Financial Decisions, What is GST (Goods and Services Tax)?
What is GST? GST (Goods and Services Tax) is the biggest indirect tax reform of India. GST is a single tax on the supply of goods and services. It is a destination based tax. GST has subsumed taxes like Central Excise Law, Service Tax Law, VAT, Entry Tax, Octroi, etc. GST is expected to bring together state economies and improve overall economic growth of the nation.
Before learning more about Goods and Sevice Tax, let’s try to understand how taxes in India work. The Government of any country needs money for its functioning and taxes are a major source of revenue for a Government. The taxes thus collected are spent by Govt. on the public.
History of GST:
The goods and services tax (GST) is an indirect federal sales tax that is applied to the cost of certain goods and services. The business adds the GST to the price of the product; a customer who buys the product pays the sales price plus GST, and the GST portion is collected by the business or seller and forwarded to the government.
France was the first country to implement the GST in 1954, and since then an estimated 160 countries have adopted this tax system in some form or another. Some of the countries with GST include Canada, Vietnam, Australia, Singapore, UK, Monaco, Spain, Italy, Nigeria, Brazil, and South Korea. India is set to join the GST group on July 1, 2017.
Most countries with a GST have a single unified GST system, which means that a single tax rate is applied throughout the country. A country with a unified GST platform merges central taxes (e.g. sales tax, excise duty tax, and service tax) with state-level taxes (e.g. entertainment tax, entry tax, transfer tax, sin tax, and luxury tax) and collects them as one single tax. These countries tax virtually everything at a single rate.
Only a handful such as Canada and Brazil have a dual GST structure. Compared to a unified GST economy where tax is collected by the federal or central government and then distributed to the states, in a dual system, the federal GST is applied in addition to the state sales tax. In Canada for example, the federal government levies a 5% tax and some provinces/states also levy a provincial state tax (PST) which varies from 7 to 10%. In this case, a consumer’s receipt will clearly have the GST and PST rate that was applied to his or purchase value.
India is proposed to have a dual GST set up in 2017, which will be the biggest reform in the country’s tax structure in decades. The main objective of incorporating the GST is to eliminate the tax on tax i.e. double taxation which cascades from the manufacturing level to the consumption level.
Brief History of GST in India:
Introduction of GST is considered to be a significant step in the reform of indirect taxation in India. Amalgamating of various Central and State taxes into a single tax would help mitigate the double taxation, cascading, a multiplicity of taxes, classification issues, taxable event, etc., and leading to a common national market.
VAT rates and regulations differ from state to state. On the other hand, GST brings in uniform tax system across all the states. Here, the taxes would be divided between the Central and State government.
The current system with no GST implies that tax is paid on the value of goods and margin at every stage of the production process. This would translate to a higher amount of total taxes paid, which is carried down to the end consumer in the form of higher costs for goods and services. Implementing the GST system in India is, therefore, a measure that will be used to reduce inflation in the long run, as prices for goods will be lower.
These taxes are broadly classified into two types: Direct Tax and Indirect Tax
Direct Tax – Direct Tax is imposed on the Income of an individual. The amount of Tax payable varies on the income earned by the individual from various sources such as salary, house rent income etc. So, the more you earn, the more tax you pay to the Government which essentially means the rich pay more tax in comparison to the poor.
Indirect Tax – Indirect tax is not imposed directly on the income of individuals. Instead, it is imposed on goods and services which in turn increase the cost MRP) of Goods and Services. Unlike the direct tax, an indirect tax should be borne by the end customer, rich and poor alike., There are many indirect taxes. Some of these are levied by the Central Government whereas some are levied by the State Government making the indirect tax system an extremely complicated system.
GST has been introduced to replace multiple indirect taxes levied by State and Central Governments in order to simplify the indirect tax system. GST has replaced almost 17 of the existing state and central indirect taxes (more to come in the future) such as central excise duty, additional customs duty, VAT, entertainment tax, service tax etc.
It is called as Goods and Services Tax because it is applicable to the supply of both Goods and Services. Click for understanding GST with a simple example.
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