Chapter 1 Introduction to Company

1、Chapter 1 Introduction to CompanyBy: LylaContents lBusiness and Your LifelTypes of Business OrganizationslStructures of company lDiscussion Business and Your Lifel What is business?l Business transactionsl Because business furnishes the things we use, gives us useful work to do, offers opportunities

2、 for saving and investing, and aiding the national defense, it is truly the backbone of the modern life. l In fact, business is the foundation on which the existence and welfare of our people depend.What is business?lBusiness means different things to different people.lIn general, business means the

3、 works or activities by which goods and services are provided and obtained for money payment.lBusiness business is business.Business transactionslTo carry on business, whether it consists of producing goods, or providing services, three factorspeople, goods, and moneyare necessary.lPeople refers to

4、both producers and consumers.lGoods means the products that persons or communities buy to satisfy their wants.lMoney is exchanged for goods and services.Types of Business Organizations lSole Proprietorship (个人独资企业)lPartnership（合伙企业） lCooperation (股份有限公司)1. Sole proprietorshipA sole proprietorship is

5、 a business owned and controlled by one person. Sole proprietors concentrate on restaurants, street corner grocery stores, florists, beauty saloons, drug stores, farms and similar businesses. Advantages & disadvantages of sole proprietorshipsAdvantagesl Simple to establishl Freer in decision-mak

6、ing As a sole proprietor, you make your own decisions on the type of goods (or services) you want to offer at the price you feel appropriate. l Easy to keep operational and financial secrecy l Less tax burdenl Exclusive use of profits The most appealing feature of being a sole proprietor: Employees,

7、 be they general managers or blue-collar workers, often have the feeling of “making bridal dresses for others”. This is why so many people choose to be their own boss. As a sole proprietor, if you work hard and make a small fortune, you can take all the profits and dont have to share them with anyon

8、e else. DisadvantageslUnlimited liability This is the worst nightmare for every sole proprietor. Liability here means obligation to pay ones debts. A sole proprietor has, by law, unlimited liability, which means if he goes bankrupt, he may, in order to pay his debt, lose not only his business but pa

9、rt or all of his personal properties. lLimited access to capital lLimited managerial expertise2. Partnership lDefinition A partnership is a for-profit business owned by two or more people. In most forms of partnerships, each partner has unlimited liability for the debts incurred by the business. The

10、 three typical classifications of partnerships are general partnerships, limited partnerships, and limited liability partnerships. Although partnerships can be formed upon oral agreement, most partnerships have a written contract which stipulates (规定）the duties of each partner, the way to share prof

11、its and losses, and in case of dissolution, the method to divide assets and or liabilities. lPartnerships are typically found in businesses such as law firms, and dental clinics which provide professional services in specialized areas. Insurance firms, advertising firms, real estate firms and manage

12、ment consulting firms are also common examples of partnerships.l Although all are called partners, some members of a partnership may be very active in the management of the firm and therefore take unlimited liability, while others choose to stay away from management and assume only limited liability

13、. The former are referred to as general partners （普通合伙人）and the latter as limited partners (有限合伙人）. l In each partnership, there must be at least one general partner. Advantages lImproved access to capital and creditlGreater possibility for good managementlDefinite legal framework lBetter prospects

14、for growth DisadvantageslUnlimited liability （连带责任）（连带责任） Like sole proprietors, general partners are personally responsible for any debt they owe and may lose all their personal properties if the partnership goes broke. lInternal conflictslProblems of continuity If one partner dies, retires or simp

15、ly wants to withdraw hisher capital, the partnership will have to break up unless the remaining partners are able and willing to buy the leaving partners share. Or they may have to find a new partner, which may turn out to be difficult, because the newcomer has to be acceptable to all of the remaini

16、ng partners.3. Corporation A partnership can raise more capital than a sole proprietorship, but if your business keeps going and needs huge sums of capital, you may have to choose a different form. Besides, if you remain a general partner, unlimited liability may get on your nerves now and then. If

17、you have such problems, a corporation may be the answer. Basic information about “corporation”l To form a corporation（股份有限责任公司）, at least 3 incorporators (公司股东）are needed. The corporators are also called stockholders or shareholders, because they hold shares, which represent ownership of the company

18、. l Shareholders own the company and therefore have the right to elect a board of directors. The board of directors then choose a president, who in turn appoints other senior officials of the company. All these officials, including the president, are responsible to the board for the day-to-day manag

19、ement of the company. l Corporations are the backbone of modern economy, although in number corporations account for only a small percentage of all business firms.l e.g. in the US, corporations account for only 20% of all business firms, but contribute nearly 90% of all sales revenues and provide jo

20、bs for approximately 70% of all American workers.lA corporation is a legal person, which means it is treated like a private person under the law. It can receive, own and transfer property, enter into contracts, sue and sued. AdvantageslLimited liability Owners, i.e. shareholders, of a corporation ar

21、e not personally responsible for its losses. If the company goes bankrupt, its creditors can take away the assets of the company but not the personal properties of the owners. lEasy to expand Corporations can issue bonds and shares of their stock to the public, thus raising large sums of funds. In a

22、ddition, using their relatively huge assets as collateral （抵押物）, corporations may be able to take out large loans from banks or other financial institutions. lSeparated ownership and management The shareholders own the company, but they are not responsible for the daily management. Such daily duties

23、 are delegated to the managers of the company, who are usually professional managers with expertise in marketing, production, accounting, law, etc. as a result, the management as a whole is more efficient. lContinuous life For a sole proprietorship or a partnership, the death of the owner or the dep

24、arture of one or more partners may mean the termination of the business. The life of a corporation is much more resilient, because its ownership, which is in the form of its stocks, is divisible and transferable. So long as a company is profitable, the change-of hands of the shares of its stock has

25、little impact on the life of the company. DisadvantageslDouble taxation E.g. in the US, corporations with more than 35 shareholders should pay state and federal taxes on their profits; and shareholders pay personal income (their dividends) taxes. lHigh organizing costs pay a fee to get a license; ha

26、ve more government regulations; must keep records of their operations, which the government has the right to examine to see if a company observe regulations regarding environment, consumer protection, industrial relations (劳资关系）, etc. lLack of secrecy Structures of companyStructures of companyl At t

27、he top of the company hierarchy is the Board of directors （董事会）, headed by the Chairperson （主席）or President （董事长）.l The Board is responsible for policy decisions and strategy. It will usually appoint a Managing Director （总经理）or Chief Executive Officer, （CEO 首席执行官）who has overall responsibility for t

28、he running of the business.l Senior managers （高级经理）or company officers （公司经理）head the various departments or functions within the company, which may include the following:Departments of company l 总公司 Head Office l 分公司 Branch Office l 母公司 Parent companyl 子公司 Subsidiary l 营业部 Business Office l 人力资源部Hu

29、man Resources Department (H&R)l 总务部 General Affairs Department l 财务部 General Accounting Department l 销售部 Sales Department Departments of companyl 国际部 International Department l 出口部 Export Department l 进口部 Import Department l 公共关系部Public Relations Department (P&R) l 广告部 Advertising Department

30、 l 企划部 Planning Department l 研发部 Research and Development Department (R&D) l 秘书室 Secretarial Pool l You only smell my perfume, but didnt see my sweat. You have your rules, I have my choice. You deny me now, I decide my future. You laugh at I have nothing,not qualified to love. I have mercy on yo

31、u always waiting for. You can look down upon our young, we will prove that who is this era.你只闻到我的香水，却没看到我的汗水；你有你的规则，我有我的选择；你否定我的现在，我决定我的未来；你嘲笑我一无所有不配去爱，我可怜你总是等待；你可以轻视我们的年轻，我们会证明这是谁的时代。lThe dream is doomed lonely journey, lthe road with question and ridicule, lbut so what?lEven if it was black and bl

32、ue all over, also want to live in beautiful. lI am ChenOu, I speak for myself.l梦想，是注定孤独的旅行，路上少不了质疑和嘲笑，但，那又怎样？哪怕遍体鳞伤，也要活得漂亮。我是陈欧，我为自己代言。”DiscussionlWould you prefer to work for a big or a small company? Why? What are the advantages of each?lReference keys Advantages of working in a small companyl The