17. Advantages and disadvantages of small businesses.

Small businesses are managed be their owners and have relatively small capital.

18. Advantages and disadvantages of corporations.

The majority of businesses are limited companies (US - corporations), in which investors are only liable for the amount of capital they have invested.

A corporation is a business, that although owned by one or more investors, legally has the rights and duties of an individual. Corporations have the right to buy, sell, and own property. Corporations may make legal contracts, hire and fire workers, set prices, and be sued, fined and taxed. A business must obtain a charter of incorporation from the state legislature to be legally recognized as a corporation.

Corporations have some advantages : 1)a corporation has limited liability, so if the corporation goes bankrupt, the stockholders lose only the value of their stock. The stockholders, who are the corporations owners, cannot be held personally responsible for any money the corporation owns. 2) corporations can raise very large amounts of money. 3) a corporation has an unlimited life. 4) ownership transfer is easy.

But corporations have some disadvantages: 1) complex forms must be filed with the state or federal government. A charter must then be issued, investors found, share sold, and manufacturing or sales begun. 2) a corporation's profits are subject to double taxation. A corporation must pay taxes on its profits before the distribution of profits as dividends to stockholders and after this distribution stockholders pay taxes on this income.

3) in corporations with many owners or stockholders the individual share of profits in the form of dividends is small.

4) a corporation's owners do not directly control the business.

19. New product development.

New product development leads to better products and services and companies develop products in different countries in different ways.

Japanese companies tend to believe much more in getting new products to market and then measuring the reaction to them. And the product itself may have been developed based on observations of present and potential customers. US companies tend to use more formal market research methods. And for German companies, product development schedules tend to be more important.

Companies decide on different launch strategies for different categories of products. The launch decision also includes marketing mix decisions.

Brand extension has become valuable in the past five years. During the recession, hard-pressed marketing directors in the food industry offered consumers more choice by adding new flavors, taking out fat or sugar and so on. It was a low-risk strategy as it avoided the huge costs of new product development and offered variation on an existing purchase.

Instead of building its own new products, a company can buy another company and its established brands. Such acquisitions can be tricky - the company must be certain that the purchased products blend with its current products and that the firm has the resources needed to continue to run the purchased brands profitably.

In recent years, many companies have used "me-too" product strategies - introducing imitations of successful competing products. Me-too products are often quicker and less expensive to develop. But the imitating company enters the market late and must battle successfully.

Many companies turn to reviving successful brands that are now dead or dying. Reviving an old brand can cost much less than creating new one.