Different types of Partnership

Different types of Partnership

Partnership is a mutual relationship between two persons for some profit making activity. Individual, we call them partners and jointly, we call them partnership. A partnership is a result of an agreement between the social unites or human being for some economic goals. Any partnership requires two or more persons which share their profit in a fix ratio. May be this agreement is in a written or oral format.

Different types of Partnership

Here, we mention some partnership like –

ü  A person who invest capital in a ration, take a part in decision making also have a ratio for profit-loss, we call it active partnership or working partnership.

ü  A person who have not involve in decision making but have a ratio in capital investment and profit – loss, we call them sleeping partner.

ü  Nominal partners – A person who use his name only for business but there is no investment in company and also no profit sharing nut responsible for any payment against business.

ü  There are lots of persons who do not want to show them self as a partners, normally known as – secret partners. They are also responsible for payment against business.

ü  A person below the age of 18 years, come under the minor partners.

ü  Some person has money to invest but they are not able to bear loss. We know them as-Partner in profit. They are also responsible for payment against business.

                                                                                                                                          

Different contain for “Partnership Deed”

Different contain for “Partnership Deed”

Partnership is a mutual relationship between two persons for some profit making activity. Individual, we call them partners and jointly, we call them partnership.

A partnership is a result of an agreement between the social unites or human being for some economic goals. Any partnership requires two or more persons which share their profit in a fix ratio. May be this agreement is in a written or oral format.

 “Partnership Deed”

Here, we mention some important points for list –

ü  Firm name

ü  Partners – name & address

ü  Business types or nature

ü  Time frame for partnership

ü  Capital invested by partners

ü  Withdrawn by partners

ü  Profit – Loss sharing ratio

ü  Partners salary or commission

ü  Joining or retirement of manpower

ü  Dissolution & settlement of partners

ü  Payment of loan & settlement

What you know about partnership

What you know about partnership

Partnership is a mutual relationship between two persons for some profit making activity. Individual, we call them partners and jointly, we call them partnership. A partnership is a result of an agreement between the social unites or human being for some economic goals. Any partnership requires two or more persons which share their profit in a fix ratio. May be this agreement is in a written or oral format.

What you know about partnership

Main feature for partnership –

ü  Minimum two persons – In partnership, we require two persons at a minimum as per law and maximum is 20. It will not be a partnership if companies not follow the criteria.

ü  Agreement – every partnership have an agreement. Without agreement there is no accountability. If some persons have a relationship & doing work but they did not have a agreement, we not call it agreement.   

ü  Every partnership has some activity/business which produces some economic gain.  There is no partnership for functions and charity

ü  Every business/partnership has a mutual benefit and all those efforts carry out by all partners and all economic gain divided into a fix ratio.

ü  High risk is involved in partnership and partners will be responsible for interested and related party payments.

ü  Partnership requires a high level of blind faith on each others. Very actions should be taken for mutual benefit of the company.  

Sole proprietorship – merits and demerits

Sole proprietorship – merits and demerits

Sole proprietorship – a business in which a person responsible for managing all the business activity, responsible for providing fund and bearing all the risk. It is also called single man business or one person business. In these types of business a single person is responsible for all the matters related with business.

merits and demerits

Here, we mention some merits or demerits like –

Merits - :

ü  Easy formation

ü  Highly motivated

ü  High level of business secrets

ü  Fast decision making

ü  Close relationship with different party

ü  High level of economic attention

ü  Flexible – decision & expansion

ü  Easy to start

Demerits - :

 ü  Unlimited risk

ü  One person to manage but uncertainty of life

ü  Did not have a wide range of managerial ability

ü  Low level of influence in market

ü  Every person have a limited capital to invest

What you know about Sole Proprietorship

What you know about Sole Proprietorship

Sole proprietorship – a business in which a person responsible for managing all the business activity, responsible for providing fund and bearing all the risk. It is also called single man business or one person business. 

Sole Proprietorship

In these types of business a single person is responsible for all the matters related with business.

Some feature/characteristics for these types of business –

ü  Own capital – these types of business start only with own capital. That person manages all the capital from his own resources for investment purpose.

ü  These types of business have a small size and a single person is responsibility for all the activity.

ü  Manage & control – the sole proprietorship manage all the activity of business. A owner make all the decision & have a full control over all the full activity.

ü  These types of business have an unlimited liability. Risk factor is really high in these types of business.

What you know about Business Enterprises or Organization

What you know about Business Enterprises or Organization

Business enterprises or organization is defines as a unit of people or social group constructed for some special economic goals. The main activity of an organization is goal oriented and they have a clear road map & coordination in respect of duties and responsibilities. These human beings fully coordinated in respect to their assign activity.

Every organization have some common feature like – have a size, complex structure, formality and top to bottom hierarchy. In other words, we can say that every organization formed for some cooperative action to accomplish the collective economic goals with a clear pre-define rules or setup. For example – business organization, education group, Government bodies and hospitals.

Business Enterprises or Organization

Here, we mention some common feature/characteristics like –

ü  Permanent establishment/body – Every organization have a permanent body rules & continue without any disturbance from retirement or step-down by any employee from top to bottom.

ü  Economic goals – every organization setup for some special economic goals within define activity. Other words every organization have all goal oriented activity.

ü  Every organization have a team of specialization person to accomplish the economic goals

ü  Mutual coordination – organization goals directly or un-directly attached with every single activity. Pre-define rules and procedure is must for every organization.

ü  Structure/working body- every organization have a pre-define working structure with role and responsibility and having a fix hierarchical from top to bottom 

Different role of business activity

Different role of business activity

There are lots of activities when we form a business. Every business has a fixed and important place in society to give and take from raw materials to finish goods. In this pipeline from raw materials to finish goods, we interact with lot of interested group like some are related with internal environment and some from external environment. The main aim is to satisfied human being need with economic gain.

Different types of business activity

We divide business activity in two parts depend on their nature –

                                                           

Industry: - we mostly include manufacturing units in it. Some goods are ready to use like customers goods but some are like capital goods which help in producing others things –machinery or building etc. we divide it into four parts, first extractive – getting out raw materials for earth, sea or air. Second, Genetic – it engaged with plant & animals like nurseries and big cattle or others farms. Third – manufacturing and last is – construction.

Commerce: - production of any things for satisfactions of people or human need is the main aim of business. But we have a pipe line from industry or manufacturing to consumer. In this pipeline, we have wholesale, retails, import –export, banking, transport, Warehousing and insurance. We include all these activity into commerce which makes easy the business.

Different types of banks

Different types of banks

Banking is a comprehensive wide term in which different types of financial activity take places. In other words – a system or place where we put our money or valuable things for safety purpose and take back or withdrawal according to our need or requirement. Bank system deal in money, it takes money from depositor on a low rate and gives it to industries on other/higher rates according to their needs. In past time lot of people involve in these types of activity like – shroffs, seths, mahajans, baniya or sahukar etc.

Different types of banks

Here, we mention some different types of banks

Commercial bank – a bank which accept deposit and allow people for withdrawal in any way like cash or cheque,  come under a commercial bank. It also provide help for trade, industry, commerce, discount bill, payment, tax and money transfer etc.

Saving bank – these banks always motivate for saving for their future needs, by introducing a variety of attractive schemes. These banks are hardly working in current days.

Land development bank – these bank set up for especially for farmer. They provide fund for a long run with a low charge and recover in installments over a long run.

Co-operative bank – these banks formed on mutual benefits for a society. These banks provide short term support to farmer & small scale industry. These are formed on village level, district or state level.

Industrial bank – these banks provide medium and long term financial help to industry. Some of like – Industrial Finance Corporation of India (IFCI), Industrial Credit and Investments Corporation of India (ICICI), National Small Industries Corporations ltd.

Exchange bank – these banks have a concern with buying & selling of foreign exchange and provide support for export-import. In it, we include foreign exchange, bill payment or exchange, credit facility and allow hedging.

Banking – A History and Function

Banking – A History and Function

Banking is a comprehensive wide term in which different types of financial activity take places. In other words – a system or place where we put our money or valuable things for safety purpose and take back or withdrawal according to our need or requirement. Bank system deal in money, it takes money from depositor on a low rate and gives it to industries on other/higher rates according to their needs. In past time lot of people involve in these types of activity like – shroffs, seths, mahajans, baniya or sahukar etc.

Our first bank, Bank of Hindustan is entirely managed by out sides of India. After that bank of Bengal (1806), Bank of Bombay (1840) or Bank of Madras (1846). After freedom, the State bank of India was formed in 1955 for main financial activity in India. It is responsible for new branches in different area of India and other mutual benefit.

Banking – A History and Function  

Different functions & activity of a commercial bank –

ü  Facility for depositors: - bank means motivation for saving, it also pay interest on summit amount and also provide lockers for valuables things. It also involve different settlements like cheques, DD, bill payments or tax etc.

ü  Loan: - commercial bank provides financial support to small scale or big industries and farmer for a fix time with low level of interest rates. Mainly bank lend their money like overdraft, cash, creditor, loans & bill discounts. These facilities also divided into secured and unsecured loan.

ü  Other services: - bank also buys & sells share, bond or debentures for their customers. It also pay their regular payment like tax or premium etc.

      

                                                                                                          

                                                                                                      

Different interested group in business

Different interested group in business

In present time, it is not possible that a business only concentrate the profit making while totally ignore the social – economical relationship. There are lot of interested group in society which is directly connected by business like shareholder, employees, consumers, suppliers, and government. Here, we mention some important interested group in business: -

Share holder: - we also call them the “owner”. They require a adequate return on investment. They have complete information & a clear picture about profit and always looking for a hike in share value.

Employees: - employee requires a fair wages which take cares their living cost & growth. These require a job satisfaction environment. They are must be motivated by financial or non-financial, better working condition, medical care, retirement benefits.

Different interested group in business

Consumers: - every business depends on customer behaviour. If a business has lot of customers it shows its growth story & satiability. Every output like goods and services require customers and customers require all things with a standard and quality in a minimum price. A business also gives attention to any fault & repair, replacement, poor complaint handling and failure to delivery of goods on time.

Suppliers & creditors: - every business requires raw materials, labors, machines for a timely delivery of their goods and services. A business must pay a fair price to its suppliers for good quality materials & on timely delivery. It’s also requiring a timely payment to creditors also.

Government: - it is our duty to follow the rules passed by local, states or central government. It must a co-operation with policy maker to form a good policy with a good working environment.

Community: - the responsibility of a business for community is very important factor. Mostly, we divide it into two parts, first – as regards social, political & environment and second is improving the living condition or standard of peoples or human being.

                                                                                            

Social objectives of a business

Social objectives of a business

Every business starts with some objectives. These objectives always define the path or way of business. It also includes future steps and decision according to the demand of the future. Mostly, we found two types of business objectives – economic and social objectives. In economic objectives, we mention economic gain or profit making, production of goods and services, making market share etc. In current environment, every business has some social responsibility/objectives also like employee relationship, customer satisfaction & mix activity for society etc.

Social objectives of a business

                                                                

Every business has two type of environment from a business point of view. In Internal-environment, we include like man power, machine or capital goods, financial & technological resources. Naturally, if these are not in a manner, no business gets its goal or economical gain. In external environment, we include like economical factor, political factor, social & technical factor. These factors also play an important role while making business objective or economic-gain policy. So businesses always try to adopt a policy in which have profits with social objective.

Some social objective are: -

ü  Every business tries to make a maximum economical gain or making profit but at the same time, he must follow the rule & low passed by the Government.

ü  Moral standard must be maintained or increased in the society by business activity, it also include internal and environment.

ü  Safety features and working condition must have a standard.

ü  Accept responsibility for solving problems faced by individual and society also

ü  Share public interested information with society and take idea to improve it.

Business objectives

Business objectives

Every business starts with some objectives. These objectives always define the path or way of business. It also includes future steps and decision according to the demand of the future. Mostly, we found two types of business objectives – economic and social objectives. In economic objectives, we mention economic gain or profit making, production of goods and services, making market share etc. In current environment, every business has some social responsibility/objectives also like employee relationship, customer satisfaction & mix activity for society etc.

Business objectives

Here, we mention some economical objective of a business: -

Economic gain or making profit: - this is the primary goal of every business activity. Economic gain or making profit, we show in terms of income, return on investment and growth etc. Nobody start a business without profit making. Every company or business, if trying to survive in the market or looking for a growth number & income, these activities shows a interest for economic gain or making profit.

Product – goods & services: - every company has some product in terms of goods and services. If a business looking to increase production on the same cost, they are looking for more customers or market share. Price war some time generates cost cutting also.

                                                                                                       

Making market share: - customer is the base for all the business activity. Every business tries to increase the market share by increasing the production on same cost or by cost cutting or by decrease the price of goods and services. A business only exist the market who have a adequate number of customer for their goods & services and they are increasing their customer according to the time run.

Causes for Business Risk

Causes for Business Risk

Business risk cover a lot of factor and it arise due to lot of causes. Here we mention some important causes for business risk: -

Causes for Business Risk

Human factor: - This factor has an important role in business risk. A single carelessness mistake by any individual may lead a big accident and involve loss of life and property. We include in it like – relationship between different levels, estimating of manpower and demand of product.

Capital goods: - Mechanical defects also have causes of risk. A explosion in any machine may cause for death of man power and a loses of raw materials. Lack of proper machine care may result of accident in production line.

Economic factor: - In it, we include change in demand of product and pricing war in between the market due to competition. We also include change in technology or economic working conditions.

Natural and miscellaneous factor: - Nobody can the natural factor like rain, flood, drought, snowfall and earthquake etc. Nobody can make for-caste for these areas. Some changes in the government policy like tax or licensing etc come under the miscellaneous factors.    

Characteristics of Business

Characteristics of Business

A business is a group of activity which keeps a person or group actively involved in work for some monetary gain. In other words, we can say that it is a wide term which includes all single or multiples activity which are directed towards earning profit/salary and generating capital through some goods, services or productions.  

Characteristics of Business  

On the behalf of the definition, we mention some characteristics of business-

Use/utility-creation & transfer: - A business always creates and transfers of multiples things for use in terms of production or goods and services for exchange. In production pipeline, we change the shape the raw materials into finish goods for multiple use. We call it use/utility of things.

Goods and Services: - Every business has some productions like goods and services. Some goods are for immediate use like food chain but for some goods require some time like clothes, furniture and car etc. Some are productive goods or capitals good like tools, machine, building etc.

Risk: - it means the possibility or chance for bearing a loss. Risk is a part of business life and it is always associates with it. Mostly, we have two type of risk – calculated and uncalculated risk. Calculated risk is always be insured but uncalculated risk never be calculated like change in tech, change in demand of goods and labor problem.

Profit/Monetary gain: - Any business always associates with monetary gain or profit. Other words we can say that business means earning money and creation of wealth in terms of production of goods and services.

Types of economical activity

Types of economical activity

Every activity which is related some monetary gain come under economical activity. Activity like make a living or add to wealth or make some capital gain, these types of activity which is related with some monetary function or gain, are come under economical activity. On the behalf of activity, we divide it into these three parts like – employee, profession and business.

Types of economical activity

Employee – We also called it job, an occupation or job under which a person performs all his activity for a salary or remuneration. In other word, a person is hired or employed by someone against a fixed amount. A person performs all the activity for employer & he acts according to the need of employer.

Professional – It is define when any work or occupation requires some special knowledge come under profession. In these special services, we often include like an Advocate or an Architect or a CA, who earns living by providing specialized services to his clients. These professional is generally regulated by some law or constitution body which define minimum academic and other qualifications.

Business – A business is a group of activity which keeps a person or group actively involved in work for some monetary gain. In other words, we can say that it is a wide term which includes all single or multiples activity which are directed towards earning profit/salary and generating capital through some goods, services or productions.