Coursework entrepreneurial firm and its types. The concept of an entrepreneurial firm. Criteria for quantitative differentiation of business entities
Ministry of Education Russian Federation
Moscow State University of Economics, Statistics and Informatics
COURSE WORK
By discipline: "Basics of business"
Topic: "ENTREPRENEURIAL FIRM AND ITS TYPES".
Completed by: Zemtsova
Tatyana Pavlovna
INS 0070-00839
Checked by: Morozov
Vladimir Alexandrovich
2005
Content
Page
Introduction……………………………………………………………… 3
1. What is a firm……………………………………………………. 4
2. Private entrepreneur……………………………………….. 6
3. Partnership (partnership)……………………………………… 8
4. Corporation (limited liability companies).... 9
4.1. Small business……………………………………………. eleven
4.2. Joint stock company (closed and open)…………… 13
4.3. Limited Liability Company…………….. 14
4.4. Joint venture……………………………………... 16
4.5. Shares and bonds of companies…………………………………. 17
5. Cooperatives………………………………………………………….. 19
6. State enterprises……………………………………… 21
Conclusion…………………………………………………… ………. 24
List of used literature……………………………….. 26
Introduction
Any nation is proud of the fruits of its entrepreneurs. But any nation and each of its individual representatives are also proud of their involvement in the implementation of any specific entrepreneurial idea.
Entrepreneurship as one of the specific forms of manifestation of social relations contributes not only to increasing the material and spiritual potential of society, not only creates a fertile ground for the practical implementation of the abilities and talents of each individual, but also leads to the unity of the nation, the preservation of its national spirit and national pride.
Big banker and small shop owner, majority shareholder of a joint-stock company and real estate dealer, farmer and co-owner of an insurance company. All these persons are united by belonging to a special stratum of society - entrepreneurs. Their occupation can, accordingly, be defined as entrepreneurship. Entrepreneurship is the free initiative of people in economic activity, it is a way of organizing economic forces. The existence of entrepreneurship is a prerequisite for the functioning of the market. The next step should be a deeper clarification of the essence of entrepreneurship and its functions in the modern economic system, the conditions and types of entrepreneurial activity.
Entrepreneurship development plays an indispensable role in achieving economic success, high growth rates of industrial production. It is the basis of the innovative, productive nature of the economy. Entrepreneurship contributes to the development of competition and the "marketization" of the economy, strengthening the "openness" national economy, the development of the import and export of capital. Thus, entrepreneurship as a business entity and a special, creative type of economic behavior is an integral property of all factors for achieving economic success.
1. What is a firm
Firm
is an organization that does business under a specific name. The firm controls the use of land, labor and capital. She herself decides on the design, method of production and sale of products. A firm should be distinguished from a production unit such as a factory, farm or mine, as it is a management unit. One firm may own or control several production units.
Firms come in different sizes - one private entrepreneur or a corporation with thousands of employees.
Firm's goals
Getting the maximum profit is the ultimate goal of any commercial activity. This goal is achieved through the definition and implementation of a set of targets, both tactical and strategic. They are:
Increase in sales;
- achieving higher growth rates;
- increase in market share;
- - increase in profit in relation to the invested capital;
- - increase in earnings per share of the company (if it is a joint-stock company);
- - increase in the market value of shares (if it is an open joint stock company);
- - change in the structure of capital.
There is a theory of enterprise life cycles, according to which there are three stages of this cycle:
| First stage: | Characterized by active expansion, increasing growth rates. The accumulation is aimed at creating production capacities and capturing markets. |
| Second stage: |
Growth in share prices and profits, increase in income of capital owners. The main place is occupied by the struggle to retain its market share, the growth of production capacity, in comparison with the reduction of costs, fades into the background. |
| Third stage: |
There is a decrease in sales volumes, and with it a decrease in profits, which stimulates the outflow of capital from the industry. At this stage, the only goal of the enterprise is survival (preservation of viability), that is, the continuation of its operations for a certain period of time, often not so much for the sake of achieving a certain level of profit, but to minimize losses. |
Firm value system
Creation of values is the fundamental function of the enterprise.
The process of creating value is the satisfaction of group or individual needs, as a result of which the company achieves public recognition of its activities. A prosperous enterprise is an enterprise that receives a steady profit from its activities. The owners (or shareholders) of the enterprise are interested in a constant and ever-increasing flow of income and in such a use of their own and borrowed funds that increases the value of their property (dividends, shares). Personnel and suppliers are interested in the stability of the enterprise, long-term relationships with it, as well as in a favorable working atmosphere. For the consumers supreme value represent goods and services that satisfy them in terms of quality and price.
Public recognition, in turn, gives the company the opportunity to expand production, increase sales and services, and ultimately increase its profits.
The main working tool in the implementation of the target functions of the enterprise is a market strategy, within which the competitive advantages of the enterprise are realized. In international theory and practice of business, there are three main types of market strategy of an enterprise.
The management of the company must seriously analyze the existing competitive advantages and choose one of the strategies of behavior in the market.
After the market strategy has been carried out, the next tool for implementing the target function of the enterprise, which ensures sustainable profit, is planning aimed at achieving the goals of the enterprise.
2. Private entrepreneur
This kind of firm is also called a one-man business, or private property. The owner has or acquires the material resources and capital equipment necessary for the production activity, and also personally controls the activities of the enterprise.
If an entrepreneur comes to the conclusion that a different structure of production or its organization must correspond to the current situation, he destroys the old one and creates a new one that is adequate to these conditions. This is "creative destruction". The entrepreneur is focused not on static efficiency associated with maintaining the efficiency of the existing system, but on dynamic efficiency, which involves timely change and development of the managed system. Modern economic theory defines entrepreneurship as an initiative, independent economic activity people aimed at making a profit through the organization and use of resources for the production and sale of goods.
Benefits of private enterprise:
Sole proprietorship is easy to set up as the legal procedure is very easy and registration of this type of company is usually inexpensive.
- the owner is his own boss and has considerable freedom of action. To make decisions about what and how to produce. No need to wait for decisions of any meetings, partners or directors.
- the owner can provide personal services to the client.
- Incentives for effective work are the most energetic. The owner gains everything in case of success and loses everything in case of failure.
However, there are also disadvantages of this organizational form, and they are very significant:
With rare exceptions, the financial resources of a sole proprietorship are insufficient for the firm to grow into a large enterprise. Since sole proprietorships have a relatively high bankruptcy rate, commercial banks are reluctant to lend them large loans.
- full control over the activities of the enterprise is exercised, the owner must carry out all major decisions, for example, regarding the purchase, sale, attraction and maintenance of personnel; do not overlook the technical aspects that may arise in production, in advertising and in the distribution of products.
- the most important drawback is that the sole owner is the subject unlimited liability. This means that self-employed entrepreneurs risk not only the assets of the firm, but also their personal assets. If the company goes bankrupt, he is personally and solely responsible for the debts of the company. In this case, the owner's personal property may be sold to pay off debts.
3. Partnership (partnership)
partnership
- is a form of business organization natural development of sole proprietorship.
The Partnership Law defined a partnership (partnership) as a voluntary association of 2 to 20 people united for a joint business with the aim of making a profit. However, in some areas of activity (lawyers, accountants, brokers) more than 20 participants are now allowed to form partnerships. Partnerships can be created in the form of a general partnership and limited partnership.
By the degree of participation in the activities of the enterprise partnerships are different. In some cases, all partners play an active role in the functioning of the enterprise, in other cases, one or more participants may play a passive role. This means that they invest their financial resources in the firm, but do not take an active part in its management.
Like sole proprietorship, partnerships are easy to set up. In almost all cases, a written agreement is concluded, and the bureaucratic procedures are not burdensome.
Since many people are united in a partnership (partnership), the initial capital can be larger than in a sole proprietorship.
Firm management can be specialized. Each of the partners can take responsibility for a specific area of work. For example, for management, production, etc.
But when several people participate in management. This division of power can lead to conflicting interests, incoherent policies, or inaction when decisive action is required. It is even worse when partners disagree on major issues. For all of these reasons, managing a partnership can be cumbersome and difficult.
The company's finances are still limited, although they far outstrip the possibilities of private ownership. The financial resources of three or four partners may not be sufficient, or they may be such that they still severely limit the potential growth of a profitable enterprise.
The duration of the partnership is unpredictable. Withdrawal from a partnership or the death of a partner, as a rule, entails the disintegration and complete reorganization of the company, the potential disruption of its activities.
Partnership (partnership) suffer from unlimited liability for the activities of the enterprise. A full partnership means that each partner is fully liable for the company's debts.
You can create a limited liability partnership. In this case, the partner is liable for the debts of the enterprise in the amount of the funds that he invested in it. However, partners in a partnership of this kind cannot take part in the conduct of business - at least one of them must still accept full responsibility.
4. Corporation
Corporation is a legal form of business that is distinct and separate from the specific individuals who own them. These government-recognised “entities” can acquire resources, own assets, manufacture and sell products, borrow, lend, sue, and sue. And also to perform all those functions that are performed by enterprises of any other type.
Advantages of this form of business organization:
The most effective form of business organization in terms of attracting money capital. Corporations are inherent unique way financing - through the sale of stocks and bonds - which allows you to attract the savings of numerous households. Through the securities market, corporations can pool the financial resources of vast numbers of individuals into a common fund. Financing through the sale of securities also has certain advantages. From the point of view of the buyers. Corporations have easier access to bank credit than other forms of business organization. The reason lies not only in the greater reliability of the corporation, but also in its ability to provide bank accounts with profitability.
- Another significant advantage of corporations is limited liability. Corporate owners (i.e., stockholders) risk only the amount they paid to buy the stock. Their personal assets are not at risk even if the corporation goes bankrupt. Creditors can sue the corporation as a legal entity, but not the owners of the corporation as individuals. The right of limited liability greatly facilitates the task of the corporation in attracting money capital.
- since a corporation is a legal entity, it exists independently of its owners and, for that matter, of its own officers. Partnerships can die suddenly and unpredictably, but corporations, at least according to the law, are eternal. The transfer of ownership of a corporation through the sale of shares does not undermine its integrity. In short, corporations have a certain persistence, lacking in other forms of business, that opens up the possibility of forward planning and growth.
The advantages of a corporation are enormous and usually outweigh their disadvantages. And yet they exist:
Registration of a corporation's charter involves some bureaucratic procedures and costs for legal services.
- the next possible drawback of the corporation concerns issues related to the taxation of corporate profits. It's about a problem double taxation: that part of the income of the corporation, which is paid in the form of dividends to shareholders, is taxed twice - the first time as part of the profits of the corporation, the second - as part of the personal income of the owner of the shares.
- in sole proprietorship and partnership, the owners of real estate and financial assets themselves directly manage and control these assets. But in large corporations, whose shares are widely distributed among hundreds of thousands of owners, there is a significant divergence between the functions of ownership and control.
The reasons for this lie in the inactivity of a typical shareholder. Most of shareholders does not exercise the right to vote or, if they use this right, it is only by subscribing to the grant of authority to the current officers of the corporation.
All limited liability companies must be registered with Companies House. Before the start of actual activities, the company must submit a number of documents to the Registration Chamber for approval:
company memorandum;
- - articles of association of a joint-stock company.
| Company Memorandum: | It should record the name of the company, the address of its registered office, the objectives of the company, the amount of capital that the company intends to raise through the sale of shares. The name of the company must contain the words “limited” or, if it is a public company, “public company”. |
| Charter of a joint stock company: |
Should contain a description of how the company will be organized and managed. It should contain information about the rights of shareholders, the rights and obligations of directors, as well as the procedure for convening meetings of shareholders. |
The law requires all registered companies to publish annual reports and provide copies of these reports to Companies House.
4.1. Small business
A small enterprise can be created by a private person, and by an enterprise, organization, both state and public. Firstly, it can be simple and more complex, have branches, sites, representative offices. Secondly, the variety of purposes for which an enterprise can be created: art and ancillary crafts, the provision of various services to the population, the launch of almost any activity not prohibited by law. Thirdly, it attracts a relatively simple procedure of establishment and registration.
In industrialized countries, small businesses account for a significant share of the gross domestic product.
The viability of small enterprises is determined by the freedom and simplicity of their creation, the absence of administrative coercion, a preferential taxation system, and a market pricing mechanism.
Small enterprises include newly created or operating enterprises with up to 200 employees in industry or construction, up to 100 people in science and scientific services, up to 50 people in other sectors of the production sector, up to 25 people in non-production sectors, up to 15 people in retail.
Small enterprises can be created as a result of separation from the existing enterprise, association, organization. In these cases, the organization (enterprise) from which the small enterprise was spun off acts as its founder.
For state registration small enterprise, local governments should provide the latter with the following documents:
- - order of the founders;
- charter;
- - receipt of payment of state duty for registration.
The charter of a small enterprise establishes the goals of its activities, the procedure for the formation of the enterprise's property, the procedure for management, the possibility of redemption, the distribution of profits, the conditions for reorganization and termination of activities, and other important issues.
The enterprise independently carries out its activities, disposes of the products produced, the profit received, which remains at its disposal after paying taxes and other obligatory payments.
Small enterprises report on the results of their economic activities to the founders in the manner prescribed by the founding agreement.
The management of the enterprise is carried out in accordance with the Charter. The head (director) is appointed by the owner upon establishment of the enterprise. The management structure and staff are determined by the labor collective independently. Contracts can be concluded with managers, specialists and other employees as a special form of employment contract.
Procedural issues of the liquidation of the enterprise are resolved by the owner of the property through the liquidation commission appointed by him. Justified claims of creditors against a small enterprise being liquidated are satisfied from its property.
When an enterprise is reorganized, its rights and obligations are transferred to successors.
4.2. Joint-stock company
Joint-stock company
- voluntary organization of legal entities and citizens (including foreign ones) for joint activities by pooling their contributions and issuing shares for the entire value of the statutory fund.
Joint-stock companies are of two types - closed and open. A joint stock company whose members may alienate their shares without the consent of other shareholders is recognized open. Such a joint-stock company has the right to subscribe for the shares it issues and their free sale on the terms established by law. An open joint stock company is obliged to annually publish for general information the annual report, balance sheet, profit and loss statement.
A joint-stock company, the shares of which are distributed only among its founders or other predetermined circle of persons, is recognized closed.
Joint stock companies serve three important purposes:
Issuance of shares by an enterprise for the purpose of mobilizing Money does not change its status, that is, the organizational and legal procedures are not transformed: the meeting of future participants, the determination of the authorized capital, the development of the charter and its state registration.
Contributions (shares) of participants in a joint-stock company (partnership) may be transferred from one owner to another only with the consent of other owners (shareholders) in the manner prescribed by the charter.
Society contributions open type can be transferred from one owner to another without the consent of the shareholders. The shares of this company can be freely traded.
The supreme governing body of a joint-stock company is the general meeting of shareholders, which makes it possible to exercise the right to manage. The number of participants' votes at the meeting is determined in proportion to the size of their shares in the authorized capital.
Depending on who owns the shares, joint-stock companies can be state, cooperative, public, mixed.
A joint stock company may be created for the purposes of economic and other activities not prohibited by law. A joint-stock company, being a legal entity, has the right to conclude any transactions provided for by law, to independently resolve issues of organizing management, setting prices for manufactured products, wages, and distributing net profit. The company may have representative offices, branches, establish subsidiaries as independent commercial organizations.
etc.................
Firms are the main subjects of market relations. They carry out the production and sale of goods, provide a variety of services. According to the areas of business activity, firms can be industrial, agricultural, transport, construction, advertising, legal, etc. When conducting microeconomic analysis, despite the wide variety of firms operating in different industries and sectors of the economy, three main types are usually distinguished: ownership, partnerships and corporations. Here the main criterion is the size of entrepreneurial activity. If a we are talking about small and medium-sized businesses, then most often these are sole proprietorships and partnerships. Big business will be represented by corporations.
At present, in developed countries, the most common sole proprietorships. Such firms are usually owned by one person (or family), the owner is liable for his obligations with all his property, including personal. This form of business organization has its advantages and disadvantages. Sole proprietorships are relatively easy to organize and are the cheapest way to organize business activities - small shops, service industries, farms. In such a company, the owner combines the functions of the owner, manager and employee, which makes the business simple, flexible and easily controlled, and excludes the emergence and clash of intra-company interests. The success of a business depends entirely on the personal qualities and entrepreneurial abilities of the owner. However, this type of firm has a number of disadvantages. The financial resources of sole proprietorships are usually limited by the capital of one owner, which is a serious obstacle to the expansion and development of the business. In a situation of negative changes in market conditions, limited financial resources often causes bankruptcy of sole proprietorships. Financial institutions are reluctant to lend to small businesses given their high risk of bankruptcy. And another drawback of this form of doing business is unlimited liability for its obligations.
partnership arises in the case of combining the resources and entrepreneurial abilities of two or more persons. Since the resources of several persons - the owners of the company are combined here, each of them has the right to an appropriate part of the total profit and the obligation to assume a certain share of responsibility for losses if they occur. The general liability of the partners under obligations is unlimited. The partnership does not exclude the division of functions between partners - for example, the management of the company can be entrusted to one of them. The advantages of this form of business organization are as follows. First, partnerships have a larger financial base than sole proprietorships. Secondly, the relative simplicity of the organization. Thirdly, the possibility of specialization between the owners of firms, which implies the division of economic functions between them and makes it possible to increase the effectiveness of the partnership. Unlike sole proprietorships, partnerships can be fairly large firms. Now for the disadvantages. Partnerships, as well as sole proprietorships, may face a shortage of financial resources and difficulties in obtaining credit. In addition, the partnership may have a problem that is not characteristic of sole proprietorships - the emergence of a conflict of interest among the owners. The probability of intra-company conflicts is quite high if the management functions are not carried out by all partners, while responsibility, including with their personal property, is borne by all participants in the partnership. And one more negative point is the unpredictability of the existence of a partnership in time, since the exit of one or several partners from the business usually leads to the collapse of the company. The fact is that partnership agreements are strict. If the situation changes due to the exit of one of the partners or, conversely, the emergence of a new co-owner, then the agreement is drawn up again. On the other hand, in case of bankruptcy of one of the partners, the responsibility for the obligations of the company is transferred to the property of the others.
Despite their shortcomings, sole proprietorships and partnerships are the dominant type of firm in developed countries. These firms are usually small in size and, due to this circumstance, have some purely technological advantages - flexibility and the possibility of accelerated changeover of production, a quick response to changing market conditions, the possibility of organizing such a firm in almost any industry with minimal initial capital.
Corporation- a form of business organization based on limited liability. The owners of such a firm receive income and are liable for the obligations of the corporation only within the limits of the invested funds and in proportion to their size. Liability thus does not extend to the personal property of corporate owners. The property of the corporation is divided into parts between the owners in the form of shares and shares. After its establishment, a corporation can distribute securities mainly in the form of shares and bonds - this is a source of raising funds to finance the activities of such a company. The corporation as a form of business organization also has its advantages and disadvantages. Among the advantages it should be noted, firstly, almost unlimited financial opportunities by raising funds through the issuance of shares and bonds. Secondly, the limited liability of the owners of the corporation to the extent of the contribution to authorized capital firms. Thirdly, corporations are usually significant in terms of production volume, providing tangible savings due to serial production. Fourth, the significant scale of activity provides the corporation with a deepening of both production and managerial specialization, which increases the efficiency of the firm. Fifth, corporations exist as a legal entity regardless of the will of their founders, that is, a change in the number of owners of such a company does not lead to the termination of its existence.
The shortcomings of the corporation can be reduced to the following. Firstly, these are significant difficulties in organizing and creating. Secondly, as a rule, corporations are characterized by the separation of the functions of ownership and management, i.e., the owners of the company (shareholders) usually do not manage the company, but involve hired managers (management specialists) for these purposes. The latter may have their own goals that do not coincide with the interests of shareholders. This can lead to abuse by managers. Thirdly, in large corporations, the suppression of the interests of small shareholders and the subordination of the company's activities to the interests of large corporation owners is not ruled out. Fourth, in the case of organizing a business in the form of a corporation, the danger of double taxation of the company's income is not excluded - taxation of the corporation's profits plus taxation of income on shares (dividends), which are paid out of profits and represent a form of profit distribution among the co-owners of the company.
There are other approaches to classify firms by type. Depending on the behavior of firms in the market and the goals they pursue, entrepreneurial firms are distinguished (here the interpretation of the concept of "entrepreneurial firm" is narrower; above, the firm was considered as a way of organizing entrepreneurial activity), capitalist, self-governing, state and directors.
So, entrepreneurial firm usually small in size. This is a company organized and usually owned by one person. It is typical for an entrepreneurial firm to combine the functions of ownership and management. the main objective activities of such firms - the desire to maximize profits. If we look for correspondences between the considered approach to the typification of firms and the one given above, then one can unambiguously attribute sole proprietorships to this type of firms and, with some reservations, partnerships can also be included here. capitalist firms usually they are large business entities, they are distinguished by a plurality of goals - this may be not only the desire to maximize profits, but also the desire to increase market share, strengthen market power, etc. These firms have a complex organizational structure and owned by multiple owners. Capitalist firms usually exist in the form of corporations, they tend to separate the functions of ownership and management. self-managed firm belongs to the workforce. Such firms are little studied. It is believed that the purpose of such firms is to maximize the income received by employees, as well as to ensure employment. State firm- A non-profit, non-market, state-owned firm in which the main decisions are made by the state or its bodies. From entrepreneurial enterprises it is distinguished only by the fact that here we are talking not about private, but about state property, but the functioning of a state firm is completely determined by market conditions. The activities of state-owned firms are usually aimed not at maximizing profits, but at maximizing social benefits. Director firm- this type of firms, which are characterized by blurring of property rights. The main decisions in such firms are made by managers, and the activities of female directors of the firm are focused on maximizing the benefits received by managers. It is believed that this type of firms has become widespread in our country as a result of voucher privatization, which has created some uncertainty with property rights. The behavior of such firms is reduced to the struggle for survival and the desire of the directors to maximize their own benefits.
So, we have already touched upon the question of the priority goals of the activities of firms. Now our task is to specify them. Observation of the behavior of economic entities allows us to speak about the multiplicity of goals for the activities of such hierarchical structures as firms. The targets of firms are, indeed, diverse and subject to change. One of the most important indicators of the results of the company's activity is the proceeds from the sale of manufactured products. The firm's goal may be to maximize revenue. Many firms, as the main goal of their activity, set themselves the provision of economic growth at the enterprise, which is manifested in increasing production volumes, revenue growth, positive dynamics of the main resulting indicators, and most importantly, in increasing market share. Economic growth in an enterprise is an indicator of business success, a basis for achieving more long-term goals. The fundamental motive of many firms is survival in the long run. This is especially true for firms operating in a competitive market environment or close to it. Survival in the long term involves setting a number of intermediate goals: the introduction and improvement of technologies, improving product quality, innovation, diversification of production. In the case when a firm is a complex hierarchical structure of a corporate type, the goal of its activity may be the pursuit of satisfaction, associated with the need to find a compromise between the interests of the parties.
As the main goal of the economic activity of firms, many economists single out the desire to maximize profits, since this is the main motive for doing business. Even in the presence of alternative goals, any firm will be aimed at obtaining a satisfactory level of profit. And this motive of activity will always be present. Without this, it is impossible to ensure the survival of the company in conditions market competition. And one more argument - profit is the main source of remuneration for an entrepreneur, and its absence can be considered as an anti-incentive to carry out economic activities.
Based on the position of making a profit as the main motive for the economic activity of firms, we will conduct further analysis. Until the last moment, describing the goals of the company, we referred to such indicators as revenue, profit. Now our task is to clarify the essence of these concepts, to clarify their economic content. But first it is necessary to study the essence, types and features of production costs, the value of which will predetermine the presence or absence of profit from the manufacturer, its value, and hence the possibility of realizing the main goal of the company - profit maximization.
Enterprise and Entrepreneurship
The main economic structural unit in a market economy is an enterprise. It is the enterprise that is the manufacturer of goods and services, the most important market entity that enters into various economic relations with other entities on the basis of entrepreneurial activity.
Entrepreneurial activity – initiative independent activity aimed at meeting the needs and making a profit . Entrepreneurial activity in the Russian Federation can be carried out by citizens (individuals), as well as enterprises (legal entities).
The status of an entrepreneur is acquired after the state registration of a legal or natural person. Entrepreneurial activity cannot be carried out without registration. The rights, obligations, responsibilities and guarantees of entrepreneurs are regulated by national legislation. The laws of the Russian Federation, for example, guarantee:
– the right to engage in entrepreneurial activity, establish enterprises, acquire extremely important equipment and property;
– equal right access of all subjects to the market, to material, labor, information and natural resources;
- equal conditions for the activities of enterprises, regardless of the type of ownership and organizational and legal forms;
– protection of property of enterprises from illegal seizure;
- free choice of the sphere of entrepreneurship within the established limits;
- prevention of unfair competition between entrepreneurs and a monopoly position in the market of individual participants.
Entrepreneurial activity can be carried out with or without the formation of a legal entity. Entrepreneurial activity without the formation of a legal entity is carried out by a citizen - an individual entrepreneur who has passed state registration.
The success of an entrepreneur depends on several possibilities.
1. Willingness to take risks.
2. Be prepared for any opportunity that arises in the market due to risk.
3. Create new opportunities: innovation, new technologies, organizational improvement, hedging (terms contracts, premium deals - options).
Entrepreneur Success Examples:
Risk sharing (insurance, hedging).
Venture capitalists - looking for an entrepreneur with good ideas.
The way alone is the asymmetry of information.
Arbitrage - selling at high prices in another market; purchase by low prices in one market (ʼʼshuttlesʼʼ).
Relationship between entrepreneurship and the process of innovation.
1. An entrepreneur forces changes to occur (introduces innovations in the process of his activity) in order to: improve the product; introduce new technologies; develop new methods of organizing production; produce a shift in cost curves; develop new types of goods and services.
2. The process of introducing innovations is very effective:
1% of innovations have "exclusive" creative potential;
10% - high creative potential;
60% - ʼʼmoderateʼʼ and ʼʼsomeʼʼ creative potential;
30% - ʼʼsmall degreeʼʼ creative potential - performers.
3. Intra-entrepreneurship - entrepreneurial activities carried out within a large firm under the most favored nation - scientific developments, patents, inventions.
4. Government measures to develop innovation processes based on the use of the one created in 2006 ᴦ. special innovation fund, annually replenished.
The market process as a process of natural selection, contributing to the regulation of losses and profits of the entrepreneur due to the main mechanism of the market - competition. Entrepreneurial innovation ʼʼrevitalizesʼʼ the market in a similar way to the genetic processes of animals, but leads to risky situations.
Τᴀᴋᴎᴍ ᴏϬᴩᴀᴈᴏᴍ, there are three driving forces market:
1. Willingness to take risks for a decent profit.
2. Arbitrage processes open up opportunities for processing information embedded in existing prices, directing the economy towards a state of equilibrium.
3. The processes of innovation that violate the existing balance create risky conditions for the revival of the market (Figure 1.1).
Figure 1.1 - Classification of business risks
Entity- an organization that has separate property in ownership, economic management or operational management, is liable for its obligations with this property, can acquire or exercise property and personal non-property rights on its own behalf, bear obligations, be a plaintiff and answer in court. A legal entity is characterized by such basic features as:
- property isolation, i.e. the presence of an independent balance sheet for commercial organizations or an independent estimate for non-profit organizations. The property belongs to a legal entity by the right of ownership or is in its economic or operational management;
- independent property liability, i.e. liability for its obligations with separate property;
- solo performance civil circulation on its own behalf, the ability to conclude civil law contracts (purchase and sale, supply, transportation, loan, lease, contract, etc.) or otherwise acquire rights and bear obligations;
- organizational unity, i.e. the presence of an appropriate stable structure, enshrined in the constituent documents.
The main form of business organization is the enterprise.
Company– an independent economic entity with the right of a legal entity, created in the manner prescribed by law, for the production of products, performance of work and provision of services in order to meet public needs and make a profit.
Production in a market economy means any kind of activity that generates income, regardless of whether they occur in the sphere of material production or in the service sector.
An enterprise is a property-based economic unit organized to achieve some economic goal, i.e. it is an economic unit that:
- independently makes decisions;
-actually uses factors of production for the manufacture and sale of products;
- seeks to generate income and achieve other goals.
An enterprise is a commercial organization, that is, an organization aimed at making a profit. In this, the enterprise differs significantly from non-profit organizations, ᴛ.ᴇ. organizations that do not pursue the goal of making a profit. Usually these include charitable and other foundations, associations, public associations, religious organizations, etc.
Every enterprise in the market must comply with the following principles:
- cost-effectiveness (achieving the desired results at minimal cost or, at a certain amount of costs, ensuring the greatest results);
- financial stability (the enterprise can make the necessary payments at any time);
- making a profit (production and sales in terms of quantity and quality must be organized in such a way as to ensure profit and profitability).
Enterprises are different in terms of conditions, goals and nature of functioning. For a deeper study of entrepreneurial activity, enterprises are usually classified according to the type and nature of economic activity, forms of ownership, ownership of capital and control over it, legal status and other features. The following types of enterprises can be distinguished:
By industry and type of economic activity:
production, research and production; trading; construction; and etc.
By form of ownership:
state; municipal; private; mixed.
By the nature of the legal regime of ownership:
individual; collective:
a) with common shared ownership;
b) with common joint property.
By the capacity of the production potential (the size of the enterprise):
- small; medium; large.
According to the prevailing production factor:
- laborious; capital-intensive; material-intensive.
By ownership of capital and control over it:
– national; foreign; mixed.
Given the dependence on the limits of responsibility:
- with full responsibility; with limited liability.
According to the legal form of entrepreneurial activity:
General partnership; fellowship of faith; limited liability company; additional liability company; joint-stock company; production cooperative; unitary enterprise.
By type of product:
Enterprises for the production of goods;
Service providers.
Enterprise and entrepreneurship - concept and types. Classification and features of the category "Enterprise and entrepreneurship" 2017, 2018.
entrepreneurial firm, along with consumers and the state, is an important element of the business process.
The term "entrepreneurial firm" is absent in all legislative documents of our country. Meanwhile, it is fundamental in the characterization of entrepreneurial business in many countries with market economies. This term expresses the official status of the entrepreneur, which allows him to be a full participant business relations.
In Russia, an entrepreneurial firm can be created in two forms:
1) an enterprise (institution or organization), i.e. a legal entity (see below);
2) activities of private individuals registered as entrepreneurs without forming a legal entity (PBOYuL - see below).
Thus, the transformation of an entrepreneur into a legal entity or PBOYuL is identical to the creation of an entrepreneurial firm.
Based on the practical activities of an entrepreneurial firm, the following definition can be given:
entrepreneurial firmis an independent business entity. Its independence is manifested in the areas of production and expenditure of resources, intermediary activities, disposal of products and profits left after paying taxes and other obligatory payments.
An entrepreneurial firm can produce any product, sell it, engage in intermediary activities (not related to the production of products) and any other activity not prohibited by law. Whatever enterprises or PBOYuL do, their activities are regulated by law, that is, their behavior in the market must comply with the norms and rules of the law. An entrepreneurial firm operates in all areas of production, sales, replenishment of intermediary operations, provision of services: in this sense, its activities are universal, that is, there is no division into areas of activity of entrepreneurial firms.
An entrepreneurial firm has an official status in society, which assigns to it certain rights and responsibilities. To protect these rights and ensure the fulfillment of obligations to consumers, the state and other business entities, an entrepreneurial firm needs to obtain official status, legal registration and consolidation of it. The status of an entrepreneurial firm is determined by the following points:
It is an economic entity of the market, that is, it has the right to conduct economic activities independently;
Carries out activities related to the production of goods or services, the sale of goods or services, the performance of work;
Has property that is separate from the property of its participants: has a separate economic turnover;
Is a full participant in business relations.
The law guarantees the non-intervention of authorities government controlled and other entrepreneurs in the direct management of the company. However, there are cases when the state, with the help of the law, can install its managers at a particular enterprise. These cases refer to state regulation competition in the market and limiting attempts to monopolize the market. You will learn about such cases in the "Competition" section of this tutorial.
Entrepreneurial firms are also guaranteed the right to apply to a court or state arbitration with an application for the recognition of invalid or unlawful acts of any state bodies and actions of officials relating to it. In this case, the company has the right to demand compensation for the damage caused to it, including lost profits. In these cases, the defendants may be government bodies in general and individual officials who violated the rights of an entrepreneurial firm with their instructions. In addition, improper performance by these bodies or officials of their duties towards the affected business firm can also be recognized as the basis for compensation for damage. Enterprises, PBOYuL and individual consumers can win a dispute in court with state bodies, other enterprises or individuals, they can also in court rules and regulations established by law. The latter applies even to federal laws and codes.
The activities of entrepreneurial firms are regulated in our country by a number of legislative documents:
1. Civil Code of the Russian Federation;
2. Code of Civil Procedure of the Russian Federation (CPC RF);
3. Arbitration Code of the Russian Federation;
4. Federal Law "On joint-stock companies ah" No. 208-FZ;
5. Federal Law "On Limited Liability Companies" No. 14-FZ;
6. Federal Law "On foreign investment» No. 160-FZ;
7. Federal Law "On Insolvency (Bankruptcy)" No. 6-FZ;
8. Federal Law "On state support small business in the Russian Federation” No. 88-FZ.
The main of these documents is the Civil Code of the Russian Federation (CC RF). The remaining documents develop, supplement and explain the main provisions in the regulation of entrepreneurial activity that are affected by the Civil Code of the Russian Federation.
Entrepreneurial firms are created for the implementation of different goals:
1. Legalization of entrepreneurial activity.
2. The practical application of a variety of potential (property, production, commercial, financial, labor, intellectual) in order to create, process, resell goods or provide services.
If these are the goals of establishing a firm, then legislation makes possible the normal functioning of the company and guarantees the observance of its rights as a sovereign business entity.
However, an entrepreneurial firm can be created for other purposes. An entrepreneur may have different goals, for example:
- the company is created to open ruble and foreign currency accounts in banks, for the implementation of foreign exchange and other transfers (transfer of funds);
- the company is created for "laundering", i.e. legalization of funds that initially arose as a result of criminal acts (robbery, robbery, extortion, racketeering, etc.);
The company appears as a front for the activities of other companies engaged in illegal business or violating certain laws - in this case, the founders of the company are interested in the possibility of obtaining an office, loans, orders, the possibility of investing funds by an enterprise that has a spotless reputation.
Questions for self-control
The term legal entity is very important for studying the nature of entrepreneurial business entities. However, this concept does not give an exhaustive idea of the nature of the activities of an organization that has the status of a legal entity, first of all, of what type of business activity this legal entity is the subject of. The fact is that the concept of a legal entity applies not only to those who are engaged in entrepreneurship, but also to organizations that cannot be classified as business entities even theoretically. These are, for example, the Government of Russia, The State Duma, ministries, departments, other federal, municipal, local authorities and administration, military units Russian army, state law enforcement agencies, other organizations that are prohibited from engaging in entrepreneurial activities. All of the above organizations are not legal entities, but they are subject to the rules governing the participation of legal entities in relations regulated by the civil legislation of Russia.
In addition, it is necessary to adequately characterize business entities registered abroad and operating on the territory of the Russian Federation, which, as a rule, are defined at the place of registration using concepts that are practically not accepted in the Russian lexicon - a firm, a company, a corporation, a holding pyramid,
multinational company and others.
More needed precise definitions those legal entities that have the right to act as subjects of entrepreneurial business. The Civil Code of Russia contains an extensive list various types legal entities - organizational and legal forms of entrepreneurship. In the next section of the Business Essentials tutorial, we'll look at detailed description form data. Here we note that neither the Civil Code nor other regulatory and legislative documents contain a universal concept that should be applied to various types of legal entities capable of acting as business entities. Such a general concept, we believe, can be entrepreneurial firm .
The concepts of a firm and an entrepreneurial firm, as well as the concept of a company, are widespread in English-speaking countries with a market economy and, thanks to the use of English as a universal means of international speech communications, have penetrated into the business lexicon in foreign-speaking countries. These concepts determine, as a rule, the official status of an entrepreneur, which allows him to be a full participant in entrepreneurial business relations, exercise the rights of a business entity and bear obligations to other business entities. In Russian, both the term “entrepreneurial firm” and its derivatives corporate identity, corporate name, corporate product, corporate design are traditional elements of colloquial use.
At the same time, the concept of an entrepreneurial firm is not contained in modern Russian legal documents (as opposed to a corporate name), as, by the way, such terms as business, business entity or entrepreneurial business. True, they do not contain a prohibition on the use of the mentioned concepts, and, as we have already noted, alternative definitions.
Thus, although the legal documents applied in Russia do not contain an interpretation of the concept of an entrepreneurial firm, the law does not prohibit its use to determine
sets of types of legal entities that have the right to participate in entrepreneurial business . A type of entrepreneurial firm can be called entrepreneurial company (we will refer to it simply as a company in the following), which is an entrepreneurial firm created by two or more founders.
An entrepreneurial firm can produce any product, sell it, engage in intermediary activities (not related to the production of products), financial activities and any other business activity, not prohibited by law . Otherwise, if an entrepreneurial firm breaks the law in terms of carrying out a prohibited activity, it will exceed its legal capacity, will be outlawed and, in the end, will be liquidated.
Being a legal entity, an entrepreneurial firm - has the right to independently conduct entrepreneurial activities; - implements other signs of independence in defending their business interests; - possesses property separate from the property of its participants; - has internal organizational unity, orderliness of internal communications and internal manageability.
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An entrepreneurial firm may create branches and representative offices that are not independent business entities.
The main task of branches is to carry out activities as a territorially separate division of a company that does not have the status of a legal entity, and the main task of a representative office is to advertise this company, represent its interests, sign contracts, advise potential customers and counterparties.
The activity of entrepreneurial firms is carried out on the basis of state guarantees . The law guarantees the non-interference of state administration bodies and other entrepreneurs in the direct management of the company's activities. Entrepreneurial firms are also guaranteed the right to apply to a court or state arbitration with an application for the recognition of invalid or unlawful acts of any state bodies and actions of officials relating to it. At the same time, the management of the company has the right to demand compensation for the damage caused to the company, including lost profits. Respondents in these cases can be recognized as state bodies as a whole and individual officials who violated the rights of an entrepreneurial firm by their instructions. In addition, the improper performance by these bodies or officials of their duties towards the affected business firm can also be recognized as the basis for compensation for damage.
Entrepreneurial firms and individual entrepreneurs Those who decide to act without forming a legal entity constitute a set of business entities operating in local (local) markets, in the national market and, if the latter is not prohibited by international legal norms, in the world market. All these business entities differ from each other in terms of quantitative and qualitative characteristics, on the basis of which these business entities can be attributed to one or another type, to one or another organizational and legal form.
Criteria for quantitative differentiation of subjectsentrepreneurial business are necessary, first of all, for the classification of firms according to the size of their capital, the amount of turnover, the number of employees. Such a classification of business entities has various goals - obtaining data on
trends in the development of the structure of the national economy, in particular, on the relationship between the sphere of production and the service sector, collection of information on the level and structure of employment, analysis of the degree of monopolization of local markets and the national market, and other purposes. The main criteria for the quantitative differentiation of entrepreneurial business entities, primarily entrepreneurial firms, are the number of employees and the annual turnover of capital of the company .
In accordance with the criterion of the number of employees in the United States, for example, allocate
The smallest enterprises (the number of employees is not more than 10 people);
The smallest enterprises (the number of employees is not more than 20 people);
Small enterprises (the number of employees is not more than 99 people);
Medium-sized enterprises (the number of employees is not more than 500 people);
Large enterprises (staff over 500 people).
Other countries apply similar parameters for determining the type of entrepreneurial firm depending on the number of employees.
In Germany, where the main criterion for the quantitative differentiation of entrepreneurial firms is the annual turnover of capital, until recently they singled out
Small businesses (annual turnover not exceeding DM 2.5 million);
Medium and large enterprises(with a turnover of over DM 2.5 million).
Along with other goals, the classification of business entities according to quantitative characteristics makes it possible to single out small (small) business entities. In accordance with Federal Law No. 88-FZ of June 14, 1995 (with subsequent amendments) On State Support for Small Business in the Russian Federation, in Russia to small businesses include individuals engaged in entrepreneurial activities without forming a legal entity, as well as small entrepreneurial firms (small enterprises).
In the authorized capital of such firms (the law defines them as commercial organizations- we will learn about what it is from the material of the next paragraph) participation share of the Russian Federation, its constituent entities, public and religious organizations, charitable and other foundations, as well as the share owned by one or more legal entities that are not, in turn, small businesses, does not exceed 25%. At the same time, the share of participation in such firms of individuals and other already established and operating small businesses is not limited.
The average number of employees for the reporting period should not exceed the following within small enterprises: limits :
In industry - 100 people;
In construction - 100 people;
On transport - 100 people;
AT agriculture– 60 people;
In the scientific and technical sphere - 60 people;
In wholesale trade - 50 people;
in retail and consumer services population - 30 people;
In other sectors and in the implementation of other types of entrepreneurial activity - 50 people.
Small enterprises carrying out several types of activities (diversified) are classified as such according to the criteria of the type of activity, the share of which is the largest in the annual turnover or annual profit.
Small businesses play a significant role in the Russian economy. In 2001, about one million small enterprises were registered in the country. Small businesses account for 70–80% of total number entrepreneurial firms, and their turnover is 20-25% of the turnover of all entrepreneurial firms. Financial crisis 1998 accelerated the growth of the small business sector despite the fact that it wiped out a significant number of small businesses overnight.
The number of permanent employees of operating small business entities currently exceeds 6 million people. Another 3.5 million entrepreneurs are engaged in business without forming a legal entity. According to the Institute of Entrepreneurship and Investments, taking into account citizens working under contracts and part-time jobs, as well as entrepreneurs working without forming a legal entity, about 14 million people are currently employed in small business, which is about 40% of all employed in the Russian national economy.
Of the total number of small enterprises, the largest share (44.9%) is trade and public catering enterprises. The attractiveness of this area is explained, first of all, by the relatively quick return on investment, stable consumer demand for the services provided. In industry and construction, there are 30.6% of small enterprises.
In 2001, all small enterprises produced products (works, services) in actual prices to the amount of 423.7 billion rubles, which accounted for 6.2% of the total volume of products (works, services) produced in the Russian Federation.
An analysis of the placement of small enterprises by regions of the Russian Federation showed that more than 70% of them are located in the European part of Russia. The largest number small enterprises are registered on the territory of the Central and North-Western economic regions. Every fifth small business operates in Moscow, every eighth - in St. Petersburg.
Small business entities are singled out from the totality of business entities not only for the purpose of statistical market research. The importance of distinguishing this classification group lies, first of all, in the fact that it is through small business (usually based on private property) in countries with a market-oriented economy that one of the basic principles of business is implemented - principle of economic freedom providing each of the business entities with unlimited development potential.
Possibility practical application This principle is one of the greatest achievements of modern economic civilization, the result of the centuries-old history of mankind - the history of the struggle of people with nature and with each other for the right to freedom of economic choice and for the opportunity to exercise free choice. The freedom of economic choice is complete when, along with the freedom to sell their labor power to any employer, people also acquire the freedom of choice in entrepreneurship. Do you want to do business? You are welcome. Do you wish to become an entrepreneur? No problems. Go and stand. It is clear that it will not be possible to become a big business tycoon, so to speak, a big boss right away. But every interested person can become a small businessman instantly.
To the objective benefits smallentrepreneurship include the simplicity of organizing business activities, the complete independence of entrepreneurs in terms of ensuring the fulfillment of obligations to counterparties and the exercise of rights in relation to these counterparties, sensitivity to the peculiarities of local business conditions, efficiency and flexibility in making entrepreneurial decisions, limitless imagination and flexibility in choosing a subject and type activity, constant presence and reproduction (especially in the smallest business) of the entrepreneurial spirit.
It is thanks to these advantages that small businesses around the world have long been, on the one hand, the main provider of mass services to the population, and on the other hand, the engine of technical progress, the main subject of innovative business. New high technologies of robotics, biotechnology, computer production originate in small business. In the United States, for example, the share of the smallest and smallest entrepreneurship accounts for about 40% of the gross national product and about 70% of the total labor force.
To the objective disadvantages of small business include the relative instability of the situation, due to the neighborhood with large businesses, often - the lack of proper professionalism in the management of the company, or even simply in performing the necessary functions, a weak material and financial base, a significant dependence of the work of personnel on the originality and quirks of small entrepreneurs. The existing shortcomings, however, do not detract from the positive aspects of small business.
In the figurative expression of one American researcher, the backbone of the American economy is large corporations, and its muscles are small enterprises that set big business in motion. For example, the company Lockheed", which has multibillion-dollar contracts from the military and airlines, places subcontracts with thousands of small firms. The company " General Electric"In the mid-80s, it was associated with 45 thousand subcontracting firms, more than 90% of which were small business firms. It is no coincidence that small business is perceived in the United States as an important element american dream, and in other countries with a market-oriented economy, the activities of small enterprises are under special protection of the law and are the object of state support.
In countries with a market-oriented economy, small businesses are subject to special regulation by the state. They have significant tax and reporting benefits, and are, as a rule, recipients of preferential loans. Small entrepreneurs especially need a stable business environment, full support for the desire to start without obstacles. own business, in the protection of the individual and private property.
In Russia, the law provides for a whole system of measures to support small businesses, which includes the preferential use of various state resources by small businesses, the establishment of a simplified procedure for their registration, licensing and taxation, as well as the provision of reports by them, the provision of production and technological, financial, information, credit , insurance support, granting them government orders for the production of goods and services, state assistance in foreign economic activity. At the same time, one cannot fail to say that most of the measures listed so far exist only on paper. Therefore, small business has not yet taken such a worthy place in the life of Russians as in countries with a market-oriented economy. Small business is developing inconsistently.
In the system of definitions of types of entrepreneurial business entities that differ from each other in terms of quantitative characteristics, along with small enterprises (small businesses), large and medium business. They include entrepreneurial firms and do not include PBOYuL. Large entrepreneurial firms are the direct opposite of small enterprises in all respects of activity. Usually, big business consists of the most influential in the industry, on the local market or on the scale of the national economy, business entities that have a dominant position or strive for it. Subjects middle entrepreneurship usually specialize in activities within strictly limited market niches, where they have a stable competitive position.
As a rule, the quantitative parameters of the differentiation of entrepreneurial firms are determined by qualitative parameters, primarily by the type of ownership. Small and smallest enterprises are usually private firms or collective enterprises with unlimited liability (partnerships, cooperatives). Medium and large firms are most often joint-stock companies and limited liability companies. For example, in the United States, about 70% of small firms are either sole property or owned by partners. At the same time, about 4 million joint-stock companies (corporations) belong to the category of small enterprises.
The assignment of business entities to medium or large businesses does not entail any administrative, economic or political consequences either in Russia or abroad. Therefore, we will continue to further familiarize ourselves with these types of entrepreneurship when considering specific organizational and legal forms and types of business, as well as organizational functioning entrepreneurial firms.