English guide for economists and managers (руководство на английском языке для экономистов и менеджеров). Учебное пособие

Task 2. a) imagine that you and your colleagues are going to the international conference devoted to the questions of labour. Think of three interesting titles for the reports which you would present; b) imagine that you and your colleagues are going to discuss the forth factor of production – enterprise. Enumerate some advantages of being the entrepreneur in our city / region.

UNIT VII

TYPES OF BUSINESS ORGANIZATIONS

Starting up

Before studying the material of Unit VII, read and memorize some basic and important definitions of the terms.

Business:

–the activity of making, buying, or selling goods or providing services in exchange of money;

–work that is a part of a job;

–the amount of activity that is done by a store, company, factory, etc.

Sole proprietorship (also known as the sole trader or simply a proprietorship):

– a type of business entity that is owned and run by one individual and in which there is no legal distinction between the owner and the business. The owner receives all profits and has unlimited responsibility for all losses and debts.

Partnership:

– an arrangement in which parties agree to cooperate to advance their mutual interests. Partnerships may be found in forms of general partnership and limited partnership in some countries, for example, in China, Germany, Japan, etc.

Corporation:

– a large business or organization that under the law has the rights and duties of an individual and follows a specific purpose. Chief characteristics of the corporation are limited liability, transferability of shares juridical personality and indefinite duration.

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Joint Stock Company:

– a business entity which is owned by shareholders. Each shareholder owns the portion of the company in proportion to his or her ownership of the company’s shares (certificates of ownership) Shareholders are able to transfer their shares to others without any effects to the continued existence of the company.

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(дело, предприятие)

dormant / sleeping partner – компаньон-вкладчик (представляющий

While reading the text of this Unit, you’ll find these words and expressions. They will be given as italicized ones. You may also consult any English-Russian dictionary.

Vocabulary

Task 1. While reading the text «Types of business organization» find the following English words in it and a) read them aloud correctly (if you are not sure, consult the dictionary); b) translate them; c) say what types of business organization you know and then check if they are the same in the text.

Specific, advantage, to organize, law, finance, to require, pursuit, liability, to own, decision, general, to include, success, management.

Task 2. Make your own combinations of words (phrases) using the words, given above.

Example: specific situation, to include discount, civil law, etc.

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Task 3. Define what parts of speech the following words are.

Organizational, want, colleague, manufacturing, public, publicly, beautician, specialize, agreement, benefit, limited.

Task 4. Find the word in each line which does not belong to the group.

Task 1. Discuss these questions in pairs.

a)Say what you know about types of business organization and which of them the most popular in our region / country is.

b)What type of business organization would you like to join and why?

c)Where can sole proprietors be found? What makes this type of business successful?

Types of business organization

What is business? For different people the meaning of it is different. We can give several definitions of what business is: the occupation, work, or trade in which a person is engaged; a specific occupation or pursuit; commercial, industrial, or professional dealings; a commercial enterprise or establishment. Below we give the explanation of some legal organizational forms of business activity.

Objectives of Business Organization. Business organizations are established to meet wants in society. Private businesses are formed mainly to provide for material demands (i.e. goods and services) and commercial demands (i.e. banking, insurance) in society. Government organizations, on the other hand, tend to satisfy society’s desire for defense, law and order, education and social welfare.

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Organizations are thus established to meet demands in society. In meeting these, organizations will set very definite and clear aims, for example, a manufacturing firm will want to stay in business and make a profit. The aims of an organization are normally decided by the board of directors, or in the case of public organizations by government ministers.

The most common forms of private business organizations are: sole proprietorships, partnerships and corporations.

Sole Proprietorships. A business owned and controlled by one person is a sole proprietorship. Sole proprietorships are the oldest, simplest, and the most common of all types of business. A single person provides the capital, takes the decisions, and assumes the risks. He or she is solely responsible for the success or failure of the business.

Because the financial resources available to one person often are limited, sole proprietors tend to be enterprises that require small amounts of capital to start and operate. Many doctors, dentists, lawyers, bakers, and beauticians organize as sole proprietors to provide professional services. Other services offered by sole proprietors include plumbing, carpentry, dry cleaning and lawn care. Many construction companies, small grocery stores, florists, other small retail stores, farms, real estate firms and insurance firms are also organized as sole proprietors.

The strength of this type of firm lies in the direct personal interest of the proprietor in the efficiency of his enterprise. Since the proprietor is the sole decision-taker and has no need to consult colleagues when changes of policy are required we should expect this type of organization to be extremely flexible and capable of quick and easy adjustment to changes in market conditions.

The great disadvantage of the sole proprietor from an enterprise lies in the fact that the owner is personally liable for the debts incured by his firm and his liability is unlimited. All his personal possessions are at risks and may be seized to meet creditors’ demands in the event of the business becoming insolvent. Another disadvantage of this type of firm is the strict limitation if its ability to acquire capital for expansion. Finance is restricted to the amounts which the entrepreneur is able to provide from his own resources and whatever sums he can borrow on his own security.

Partnerships. A partnership is a business that is owned and controlled by two or more people. As in the case of sole proprietorships they are concentrated in businesses that require relatively small amounts of money to start and operate. Small retail stores, farms and construction

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companies are often organized as partnerships. People in service occupations, such as doctors, lawyers, accountants, and photographers, also form partnerships. Many of these partnerships may have started as sole proprietorships. A partnership begins when two or more people agree to operate a business together. Partnership can be general or limited.

In order to avoid later conflicts, the partners usually formulate a written agreement called a partnership contract. A partnership contract outlines the contributions of partners, the distribution of profits and losses. It details the specific responsibilities of each partner and includes provision for adding or dropping partners and dissolving the partnership. The partners usually share in the task of running the business, but a partner need not play an active role. A person who joins a partnership, supplying capital and sharing in the profits, but taking no part in the management is known as a dormant or sleeping partner.

The advantages of this type of firm are similar to those of the oneperson business. It is a flexible organization which allows a greater degree of specialization than the one-person business. Partners usually specialize in one or more aspects of the business; one may be responsible for buying, one for selling, one for production, and so on. Since it has greater access to capital, it can achieve greater size than the sole proprietor.

The great disadvantage, like that of the one-person business, is the fact that the liability of the partners is unlimited and they are fully liable for the acts of the other partners. There are, however, some limited partnerships which have to be registered with the Registrar of Companies. In such firms some partners (i.e. dormant partners) may have their liability limited to some specified sum, but at least one of the partners must have unlimited liability.

The survival of a partnership depends upon the continued harmonious relationship between a number of people in situations which often give much cause to disagreement. Thus, where trading risks are very great, the partnership is not a very stable type of organization.

Corporations. A corporation is a business organization that is treated by law as if it were an individual person. A corporation can do everything that a sole proprietorship or a partnership can do. It can, for example, buy property and resources, hire workers, make contracts, pay taxes, sue others and be sued and produce and sell products. A corporation, however, is owned by stockholders. Stockholders are individuals who invest in a corporation by buying shares of stock. Stocks are the cer-

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tificates of ownership in the corporation. Stockholders invest in a corporation in order to make a profit.

A corporation may be either publicly owned or closed. A publicly owned corporation allows its shares to be purchased by anyone who chooses to invest in the business. Most corporations today are publicly owned. A closed corporation is owned by a limited number of shareholders. People outside of this limited group may not buy shares in the corporation.

Aims of Private Organizations. Profitability is the main aim of private organizations but it is important to realize that any business will have other aims. These include:

1.Survival: most of the time firms will not be worried about this. However, particularly in times of economic difficulty – such as recession

–surviving will become an important short-term aim of the firm. In order to survive, the firm may have to make workers redundant and close some of its factories.

2.Growth: not all firms want to grow continually but growth is closely associated with survival. Very often, particularly for firms in highly competitive situations, for example, computing and electronics, growth and development are the only way to ensure survival. Furthermore, shareholders and employees may benefit from the growth of the company.

3.Image: how the public at large views a company can be particularly important, and to this end a number of companies have public relations departments that have specific responsibilities to improve the image of the company. A tarnished image can very often lose the company business.

по материалу http://www.breetanica.ru

Task 2. Translate the following Russian phrases into English. Time for doing this task is limited – 10 minutes. Mind the time.

Дать несколько определений, формы предпринимательской деятельности, чтобы удовлетворить желание общества, получать прибыль, принимать на себя риск, оказывать профессиональные услуги, получать капитал для расширения, ограниченное число акционеров, во времена экономических трудностей, в высоко конкурентной ситуации.

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Task 3. Make nouns from the verbs given below.

Contribute, fail, hire, insure, manufacture, occupy, organize, require.

Task 4. Complete each sentence, using the words given. One word may be used once. Translate these words and define what part of speech they are.

and, can, organizations, one, form, small, or, usually, responsible, in

1.Business … such as sole proprietorships, partnerships and corporations are established to meet wants … society.

2.Many construction companies, … grocery stores, florists, other small retail stores, farms, real estate firms … insurance firms are also organized as sole proprietors.

3.People in service occupations, such as doctors, lawyers, accountants, and photographers, also … partnerships.

4.Partners … specialize in one or more aspects of the business; one may be … for buying, … for selling, one for production, and so on.

5.A corporation … do everything that a sole proprietorship … a partnership can.

Language review

Task 1. a) Fill in the blanks with proper forms of the verbs.

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b)Take any three verbs, used in the Text or in Task 3 a) and make three sentences of your own in English (in a written form). Making the sentences, any Grammar Tense and Voice can be used.

c)Find a partner, read your sentences and ask him (her) to translate them into Russian. Then change your roles.

Task 2. Fill in the blanks in the sentences with proper prepositions or articles.

1.Private businesses are formed mainly to provide ... material demands and commercial demands ... society.

2.Sole proprietorships are ... oldest, the simplest, ... the most common of all types of business.

3.The partners usually share in the task ... running the business, but a partner need not play ... active role.

4.Stockholders are individuals who invest ... a corporation ... buying shares of stock.

5.Very often, particularly ... firms in highly competitive situations, growth and development are ... only way to ensure survival.

Task 3. Make the Comparative and the Superlative Degrees of the following adjectives from the text of this unit.

Common, old, easy, specific, high, many, active, small, good, flexible.

Writing

Task 1. Here is a piece of information devoted to one more type of business organization – the Joint Stock Company. This extract has a detailed description of this kind of business mainly in the UK. Read it and divide into paragraphs. Be ready to explain why you have done such a division.

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The Joint Stock Company

The most important form of business organization in the UK is the joint stock company. Basically, it consists of an association of people who contribute towards a joint stock of capital for the purpose of carrying on business with a view to profit. A company may be defined as a legal person created to engage in business, capable of owning productive assets, of entering into contracts, and of employing labour in the same way as an individual. There are two kinds of the joint stock company, the private company and the public company. In 1986 there were some 860000 joint stock companies in the UK, of which about 6000 were public companies. The public companies are much larger units and account for about two-thirds of all the capital employed by companies. In general, private companies are small firms, often consisting of the members of one family. Both public and private companies must have at least two members. A public company must have a minimum allotted share capital of 50000 pounds (sterling) of which at least one-quarter has been paid up. A private company must include the word «limited» in its name while a public company must have the words «public limited company» at the end of its name although this can be abbreviated to plc. The basic distinction between a private and a public company is that a public company can offer its shares and debentures for sale to the general public. In the case of a private company it would be a criminal offence to ask the public to subscribe to its shares. All companies must file annually, with the Registrar of Companies, details of turnover, profits, assets, liabilities and other relevant financial information about their structures and activities.

Task 2. Study the extract about business etiquette in London. Translate it into Russian in a written form. Use any dictionary if necessary.

Business Meetings. Most London executives are happy to conduct business at breakfast, lunch, and dinner business meetings; however there is a preference towards discussing business at their office.

Clothes. While on business: For men the accepted form of clothing when conducting business is a suit, with a shirt and a tie. For women, either a suit or a skirt and jacket with a blouse is acceptable. At non-

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