BUSINESS

A business (also known as enterprise or firm) is an organization engaged in the trade of goods, services, or both to consumers.[1] Businesses are predominant in capitalist economies, where most of them are privately owned and administered to earn profit to increase the wealth of their owners. Businesses may also be not-for-profit or state-owned. A business owned by multiple individuals may be referred to as a company, although that term also has a more precise meaning. The etymology of "business" relates to the state of being busy either as an individual or society as a whole, doing commercially viable and profitable work. The term "business" has at least three usages, depending on the scope the singular usage to mean a particular organization; the generalized usage to refer to a particular market sector, "the music business" and compound forms such as agribusiness; and the broadest meaning, which encompasses all activity by the community of suppliers of goods and services. However, the exact definition of business, like much else in the philosophy of business, is a matter of debate and complexity of meanings.

Contents

1 Basic forms of ownership 2 Classifications 3 Management o 3.1 Reforming state enterprises 4 Organization and government regulation o 4.1 Commercial law o 4.2 Capital o 4.3 Intellectual property 5 See also 6 Notes and references 7 External links

Basic forms of ownership

See also: Types of business entity Although forms of business ownership vary by jurisdiction, there are several common forms which are as follows:

Sole proprietorship: A sole proprietorship is a business owned by one person forprofit. The owner may operate the business alone or may employ others. The owner of the business has unlimited liability for the debts incurred by the business.

Partnership: A partnership is a 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 three typical classifications of for-profit partnerships are general partnerships, limited partnerships, and limited liability partnerships. Corporation: A corporation is a limited liability business that has a separate legal personality from its members. Corporations can be either government-owned or privately owned, and corporations can organize either for-profit or not-for-profit. A privately owned, for-profit corporation is owned by shareholders who elect a board of directors to direct the corporation and hire its managerial staff. A privately owned, for-profit corporation can be either privately held or publicly held. Cooperative: Often referred to as a "co-op", a cooperative is a limited liability business that can organize for-profit or not-for-profit. A cooperative differs from a for-profit corporation in that it has members, as opposed to shareholders, who share decision-making authority. Cooperatives are typically classified as either consumer cooperatives or worker cooperatives. Cooperatives are fundamental to the ideology of economic democracy.

Classifications

Agriculture and mining businesses are concerned with the production of raw material, such as plants or minerals. Financial businesses include banks and other companies that generate profit through investment and management of capital. Information businesses generate profits primarily from the resale of intellectual property and include movie studios, publishers and packaged software companies. Manufacturers produce products, from raw materials or component parts, which they then sell at a profit. Companies that make physical goods, such as cars or pipes, are considered manufacturers. Real estate businesses generate profit from the selling, renting, and development of properties comprising land, residential homes, and other kinds of buildings. Retailers and distributors act as middle-men in getting goods produced by manufacturers to the intended consumer, generating a profit as a result of providing sales or distribution services. Most consumer-oriented stores and catalog companies are distributors or retailers. Service businesses offer intangible goods or services and typically generate a profit by charging for labor or other services provided to government, other businesses, or consumers. Organizations ranging from house decorators to consulting firms, restaurants, and even entertainers are types of service businesses. Transportation businesses deliver goods and individuals from location to location, generating a profit on the transportation costs. Utilities produce public services such as electricity or sewage treatment, usually under a government charter.

There are many other divisions and subdivisions of businesses. The authoritative list of business types for North America is generally considered to be the North American

Industry Classification System, or NAICS. The equivalent European Union list is the Statistical Classification of Economic Activities in the European Community (NACE).Mill,

Management
The efficient and effective operation of a business, and study of this subject, is called management. The major branches of management are financial management, marketing management, human resource management, strategic management, production management, operations management, service management and information technology management.[citation needed] Owners engage in business administration either directly or indirectly through the employment of managers. Owner managers, or hired managers administer to three component resources that constitute the business' value or worth: financial resources, capital or tangible resources, and human resources. These resources are administered to in at least five functional areas: legal contracting, manufacturing or service production, marketing, accounting, financing, and human resourcing.[citation needed]

Reforming state enterprises

In recent decades, assets and enterprises that were run by various states have been modeled after business enterprises. In 2003, the People's Republic of China reformed 80% of its state-owned enterprises and modeled them on a company-type management system.[2] Many state institutions and enterprises in China and Russia have been transformed into joint-stock companies, with part of their shares being listed on public stock markets. Business process management (BPM) is a holistic management approach[1] focused on aligning all aspects of an organization with the wants and needs of clients. It promotes business effectiveness and efficiency while striving for innovation, flexibility, and integration with technology. BPM attempts to improve processes continuously. It can therefore be described as a "process optimization process." It is argued that BPM enables organizations to be more efficient, more effective and more capable of change than a functionally focused, traditional hierarchical management approach.

Organization and government regulation

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Main article: Theory of the firm

Most legal jurisdictions specify the forms of ownership that a business can take, creating a body of commercial law for each type. The major factors affecting how a business is organized are usually:

The Bank of England in Threadneedle Street, London, England.

The size and scope of the business firm and its structure, management, and ownership, broadly analyzed in the theory of the firm. Generally a smaller business is more flexible, while larger businesses, or those with wider ownership or more formal structures, will usually tend to be organized as corporations or (less often) partnerships. In addition, a business that wishes to raise money on a stock market or to be owned by a wide range of people will often be required to adopt a specific legal form to do so. The sector and country. Private profit-making businesses are different from government-owned bodies. In some countries, certain businesses are legally obliged to be organized in certain ways. Limited Liability Companies (LLC), limited liability partnerships, and other specific types of business organization protect their owners or shareholders from business failure by doing business under a separate legal entity with certain legal protections. In contrast, unincorporated businesses or persons working on their own are usually not so protected. Tax advantages. Different structures are treated differently in tax law, and may have advantages for this reason. Disclosure and compliance requirements. Different business structures may be required to make less or more information public (or report it to relevant authorities), and may be bound to comply with different rules and regulations.

Many businesses are operated through a separate entity such as a corporation or a partnership (either formed with or without limited liability). Most legal jurisdictions allow people to organize such an entity by filing certain charter documents with the relevant Secretary of State or equivalent and complying with certain other ongoing obligations. The relationships and legal rights of shareholders, limited partners, or members are governed partly by the charter documents and partly by the law of the jurisdiction where the entity is organized. Generally speaking, shareholders in a corporation, limited partners in a limited partnership, and members in a limited liability company are shielded from personal liability

for the debts and obligations of the entity, which is legally treated as a separate "person". This means that unless there is misconduct, the owner's own possessions are strongly protected in law if the business does not succeed. Where two or more individuals own a business together but have failed to organize a more specialized form of vehicle, they will be treated as a general partnership. The terms of a partnership are partly governed by a partnership agreement if one is created, and partly by the law of the jurisdiction where the partnership is located. No paperwork or filing is necessary to create a partnership, and without an agreement, the relationships and legal rights of the partners will be entirely governed by the law of the jurisdiction where the partnership is located. A single person who owns and runs a business is commonly known as a sole proprietor, whether that person owns it directly or through a formally organized entity. A few relevant factors to consider in deciding how to operate a business include: 1. General partners in a partnership (other than a limited liability partnership), plus anyone who personally owns and operates a business without creating a separate legal entity, are personally liable for the debts and obligations of the business. 2. Generally, corporations are required to pay tax just like "real" people. In some tax systems, this can give rise to so-called double taxation, because first the corporation pays tax on the profit, and then when the corporation distributes its profits to its owners, individuals have to include dividends in their income when they complete their personal tax returns, at which point a second layer of income tax is imposed. 3. In most countries, there are laws which treat small corporations differently than large ones. They may be exempt from certain legal filing requirements or labor laws, have simplified procedures in specialized areas, and have simplified, advantageous, or slightly different tax treatment. 4. To "go public" (sometimes called IPO) -- which basically means to allow a part of the business to be owned by a wider range of investors or the public in general you must organize a separate entity, which is usually required to comply with a tighter set of laws and procedures. Most public entities are corporations that have sold shares, but increasingly there are also public LLCs that sell units (sometimes also called shares), and other more exotic entities as well (for example, REITs in the USA, Unit Trusts in the UK). However, you cannot take a general partnership "public."

Commercial law
Main article: Commercial law

Offices in the Los Angeles Downtown Financial District Most commercial transactions are governed by a very detailed and well-established body of rules that have evolved over a very long period of time, it being the case that governing trade and commerce was a strong driving force in the creation of law and courts in Western civilization. As for other laws that regulate or impact businesses, in many countries it is all but impossible to chronicle them all in a single reference source. There are laws governing treatment of labor and generally relations with employees, safety and protection issues (Health and Safety), anti-discrimination laws (age, gender, disabilities, race, and in some jurisdictions, sexual orientation), minimum wage laws, union laws, workers compensation laws, and annual vacation or working hours time. In some specialized businesses, there may also be licenses required, either due to special laws that govern entry into certain trades, occupations or professions, which may require special education, or by local governments. Professions that require special licenses range from law and medicine to flying airplanes to selling liquor to radio broadcasting to selling investment securities to selling used cars to roofing. Local jurisdictions may also require special licenses and taxes just to operate a business without regard to the type of business involved. Some businesses are subject to ongoing special regulation. These industries include, for example, public utilities, investment securities, banking, insurance, broadcasting, aviation, and health care providers. Environmental regulations are also very complex and can impact many kinds of businesses in unexpected ways.

Capital

Mexican Stock Exchange in Paseo de la Reforma, Mexico City When businesses need to raise money (called 'capital'), more laws come into play. A highly complex set of laws and regulations govern the offer and sale of investment securities (the means of raising money) in most Western countries. These regulations can require disclosure of a lot of specific financial and other information about the business and give buyers certain remedies. Because "securities" is a very broad term, most investment transactions will be potentially subject to these laws, unless a special exemption is available. Capital may be raised through private means, by public offer (IPO) on a stock exchange, or in many other ways. Major stock exchanges include the Shanghai Stock Exchange, Singapore Exchange, Hong Kong Stock Exchange, New York Stock Exchange and Nasdaq (USA), the London Stock Exchange (UK), the Tokyo Stock Exchange (Japan), Bombay Stock Exchange(India) and so on. Most countries with capital markets have at least one. Businesses that have gone "public" are subject to extremely detailed and complicated regulation about their internal governance (such as how executive officers' compensation is determined) and when and how information is disclosed to the public and their shareholders. In the United States, these regulations are primarily implemented and enforced by the United States Securities and Exchange Commission (SEC). Other Western nations have comparable regulatory bodies. The regulations are implemented and enforced by the China Securities Regulation Commission (CSRC), in China. In Singapore, the regulation authority is Monetary Authority of Singapore (MAS), and in Hong Kong, it is Securities and Futures Commission (SFC). As noted at the beginning, it is impossible to enumerate all of the types of laws and regulations that impact on business today. In fact, these laws have become so numerous and complex, that no business lawyer can learn them all, forcing increasing specialization among corporate attorneys. It is not unheard of for teams of 5 to 10 attorneys to be required to handle certain kinds of corporate transactions, due to the sprawling nature of modern regulation. Commercial law spans general corporate law, employment and labor law,

health-care law, securities law, M&A law (who specialize in acquisitions), tax law, ERISA law (ERISA in the United States governs employee benefit plans), food and drug regulatory law, intellectual property law (specializing in copyrights, patents, trademarks and such), telecommunications law, and more.

Intellectual property
Businesses often have important "intellectual property" that needs protection from competitors for the company to stay profitable. This could require patents, copyrights, trademarks or preservation of trade secrets. Most businesses have names, logos and similar branding techniques that could benefit from trademarking. Patents and copyrights in the United States are largely governed by federal law, while trade secrets and trademarking are mostly a matter of state law. Because of the nature of intellectual property, a business needs protection in every jurisdiction in which they are concerned about competitors. Many countries are signatories to international treaties concerning intellectual property, and thus companies registered in these countries are subject to national laws bound by these treaties. In order to protect trade secrets, companies may require employees to sign non-compete clauses which will impose limitations on an employees interactions with stakeholders, and competitors.

Types of Business Organizations

6 Forms of Business for IRS Purposes
By William Perez, About.com Guide See More About:

incorporating choice of entity business tax planning

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Start your own businessIn Booming animation industry Join hands with Arenawww.arenamultimedia.com Rs.647 p.m. 1 PolicyBazaar.com/LifeInsurance-plan (Continued from Page 1) You incorporate your business in the state you conduct business in. If you live and work in Texas, for example, you would incorporate your business in Texas. If your business conducts business throughout the United States, you need to incorporate in the state where your headquarters will be. If you have a substantial business presence in another state, you may need to let that state know and file state tax returns or sales tax returns based on your business earnings in that other state. Businesses with substantial nationwide activity sometimes choose to be incorporated in Delaware or Nevada because of the businessfriendly laws in those states. Even if you incorporate in Delaware or Nevada, you will still need to register your business in those states where you have an actual business location. The various forms of organization are established by state law. There are a wide variety of business organizations recognized by the states. For example, a popular form of organization is the Limited Liability Company (LLC). The LLC is a state designation. At the federal level, an LLC is taxed as a partnership. If the LLC so chooses, it can be taxed as a corporation at the federal level. While there are a variety of designations at the state level, for federal tax purposes there are only 6 forms of business organizations:

Sole Proprietor (1040 Schedule C), Corporation (1120), Partnership (1065), S-Corporation (1120S), Trust (1041), and Non-profit organization (990)

Sole proprietors are unincorporated businesses. They are also called independent contractors, consultants, or freelancers. There are no forms you need to fill out to start this type of business. The only thing you need to do is report your business income and expenses on your Form 1040 Schedule C. This is the easiest form of business to set up, and the easiest to dissolve. (An LLC with only a single shareholder, a so-called single-member LLC, is taxed as a sole proprietor on a Schedule C.)

Corporations are incorporated businesses. Every form of business besides the sole proprietor is considered a separate entity, and this often provides a measure of legal and financial protection for the shareholders. The shareholders of corporations have limited liability protection, and corporations have full discretion over the amount of profits they can distribute or retain. Corporations are presumed to be for-profit entities, and as such they can have an unlimited number of years with losses. Corporations must have at least one shareholder. Partnerships are unincorporated businesses. Like corporations, partnerships are separate entities from the shareholders. Unlike corporations, partnerships must have at lease one General Partner who assumes unlimited liability for the business. Partnerships must have at least two shareholders. Partnerships distribute all profits and losses to their shareholders without regard for any profits retained by the business for cash flow purposes. (LLCs are taxed as partnerships, unless they choose to be taxed as corporations.) S-Corporations have features similar to a partnership. An S-corporation must have at least one shareholder, and cannot have more than 100 shareholders. If any shareholder provides services to the business, the S-Corp must pay that shareholder a reasonable salary. This salary is a separate payment from distributions of profits or losses. Trusts are usually formed upon the death of an individual and are designed to provide continuity of the investments and business activities of the deceased individual. We will not discuss trusts further. Nonprofits are corporations formed for a charitable, civic, or artistic purpose. Nonprofits are generally exempt from federal and state taxation on their income, and so they are often called "exempt organizations." Nonprofits have substantial responsibilities for reporting their activities, income, and assets to ensure that they are in compliance with federal and state laws governing charities. For additional information on starting, managing, and developing a not-for-profit organization, see the About.com Guide to Nonprofits. As mentioned above, sole proprietors, S-corporations, and partnerships are taxed at the shareholder level. Corporations, however, are taxed at the corporate level.

The 6 Best New iOS 6 Features for Business Users

By Rick Broida, PCWorld It's official: Apple iOS 6 is coming this fall," and with it some 200 updates and improvements. Although there's nothing I'd call revolutionary (to me the updates seem more akin to iOS 5.5), Apple has baked in plenty of good stuff for business users -- starting with its homegrown Maps app, which is good news for iPhone owners but bad news for GPS-app developers.

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Here's a rundown of the most business-friendly features you'll find in iOS 6. 1. Turn-by-turn navigation The new Maps app will finally offer something Android users have enjoyed for a while: turn-by-turn navigation. That means your iPhone can steer you from point A to point B without the need for a pricey third-party app. Plus, it'll have Siri integration, so you'll be able to ask for the nearest gas station along your route, find out how much longer your trip will take, and so on. 2. Real-time traffic

Also coming to Maps: real-time traffic updates, meaning you'll be able to spot trouble areas and possibly even find out what's causing the hold-up (construction? an accident? a cop on the side of the road?). What's especially interesting is that Maps will share (anonymously, of course) real-time traffic data from your phone (and everyone else's), meaning we may finally see a crowdsourced traffic system that works. Whether it actually helps is another story. 3. New phone features Since the dawn of iPhone time, you've had exactly two options for fielding a phone call: Decline and Answer. In iOS 6, you'll also see these buttons: Reply with Message and Remind Me Later. The former lets you kick back a canned text message (e.g., "Call you later"), while the latter will set a reminder for a callback. All together, now: "Finally!" 4. FaceTime over 3G FaceTime can be incredibly handy for showing rather than just telling, but because it requires Wi-Fi at both ends, it has limited in-the-field applications. But with iOS 6, Apple is enabling FaceTime over 3G connections, effectively opening the floodgates to what you'll be able to do with it: show a mockup of a new product, report back to the home office from the trade-show floor, and so on. 5. VIP Mail Taking a page from Google's Priority Inbox, iOS 6 lets you designate contacts as VIPs, then filters all messages from those people into a special VIP Mail folder.

That should make it incredibly easy to separate the wheat from the chaff, email-wise. Another nice tweak: You can now attach photos or videos to an e-mail from within a new message. No need to hit the Photos app first. Yay! 6. Passbook Good news, frequent flyers: This new app keeps all your airline tickets (among other things) in one convenient location. Even better, it's location-aware, meaning your boarding pass will pop up on the lock screen when you get to the airport. It can even update the boarding pass in real time with gate-change information and the like. That's pretty flippin' cool. Okay, iPhone fans, those are iOS 6's most-likely-to-succeed-in-business features. What do you think of Apple's latest update? Are there features you were hoping for that weren't announced?