UNIT 5. TYPES OF BUSINESS ORGANISATION

1. Do you know the reading of the words?

enterprise, responsible, alternatively, numerous, efficien­cy, ownership, incentive, disadvantage, liability, posses­sion, involvement, since, entrepreneur, resources, secu­rity, prevalent, retailing, debts

2. And now these word combinations.

sole proprietor, joint stock company, cooperative soci­ety, public corporation, one-person business, deci­sion-taker, extremely flexible, easy adjustment, mar­ket conditions, repair and maintenance work, person­al services

3. You are to know these words and combinations:

ability (n.) - здатність

acquire (v.) - набувати

adjustment (n.) - прилад

borrow (v.) - позичати

bear (v.) - нести

capable (adj.) - здатний

debt (n.) - борг

decision (n.) - рішення

entrepreneur (n.) - підприємець

enterprise (n.) - підприємство

event (n.) – випадок, подія

failure (n.) - невдача

flexible (adj.) - гнучкий

Joint Stock Company – акціонерна компанія

liability (n.) - відповідальність

loss (n.) - втрата

maintenance (n.) – експлуатація

ownership (n.) - власність

partnership (n.) - товариство

possess (v.) - володіти

profit (n.) – прибуток

refer to (v.) – відноситися, посилатися

repair (n.) - ремонт

responsible (adj.) - відповідальний

restrict (v.) - обмежувати

retail (adj.) - роздрібний

seize (v.) - захоплювати

sole proprietor – одноосібний власник

since (prep.) – від, остільки

strength (n.) – сила

success (n.) - успіх

therefore - тому

value (n.) - здатність

4. What part of speech:

simplest, solely, employment, responsibility, alterna­tively, unimportant, condition, disadvantage, liable, possession, insolvent, strict, prevalent

5. Make the nouns:

organize, classify, decide, assume, lose, employ, com­pare, direct, control, consult, change, require, expect, adjust, possess, expand, restrict, provide

Text A

The different types of business organization to be found in the UK and most other capitalist countries may be classi­fied under five headings: the sole proprietor, the partner­ship, the joint stock company, the cooperative society, and the public corporation.

The sole proprietor

This is the simplest and the oldest form of business enterprise and often referred to as the one-person business. A single person provides the capital, takes the decisions, and assumes the risks. He or she is solely responsible for the suc­cess or failure of the business and has, therefore, the sole rights to such profits as may be made, or, alternatively, bears the sole responsibility for such losses as may accrue. The one-person business is still far more numerous than any other types of business organization, but in terms of total output employment, value of capital employed, or value of total output, it is relatively unimportant compared with the joint stock company.

The strength of this type of firm lies in the direct per­sonal interest of the proprietor in the efficiency of his enterprise. Ownership and control are vested in one person who enjoys all the fruits of success and hence has a great incentive to run the firm efficiently. Since the proprietor is the sole decision — taker and has no need to consult col­leagues when changes of policy are required we should expect this type of organization to be extremely flexible and capable of quick and easy adjustment to changes in market conditions.

The great disadvantage of the sole proprietor from an enterprise lies in the fact that the owner is personally liable for the debts incurred by his firm and his liability is unlimit­ed. All his personal possessions are at risk and may be seized to meet creditors demands in the event of the business becoming insolvent. Another disadvantage of this type of firm is the strict limitation of its ability to acquire capital for expansion. Finance is restricted to the amounts which the entrepreneur is able to provide from his own resources and whatever sums he can borrow on his own security.

We find the one-person business prevalent in farming, retailing, building, repair and maintenance work, and per­sonal services such as hairdressing.

1. Read and translate text A.

2. Reconstruct the sentences with the words:

possessions, adjustment, proprietor, failure, headings, enterprise, efficiency, ownership, conditions, flexible, fail­ure, liability, debts, decisions, responsible

1. The different types of business organization may be classified under five ... .

2. This is the simplest and the oldest form of business....

3. A single person is solely ... for the success or... of the business.

4. His ... is unlimited.

5. ... and control are vested in one person.

6. This type of organization is extremely ... and capable of quick ... to changes in market....

7. The owner is personally liable for the ... incurred by his firm.

8. All his ... are at risk.

9. A single person provides the capital, takes the ..., and assumes the risks.

3. Find here similar words:

enterprise, decision, acquire, business, obtain, need, event, proprietor, case, owner, responsible, solution, liable, require

4. Find here the words with the opposite meaning:

strength, profit, success, security, weakness, amount, failure, quantity, danger, loss

5. Make the antonyms using prefixes:

advantage, limited, able, employment, important, compared, personal, capable

6. Say it in English:

ефективно керувати фірмою, єдина особа, той, хто приймає рішення, консультуватися з колегами, надзвичайно гнучкий, зміна ринкових умов, великий недолік, особисто відповідальний за, необмежена відповідальність, задовольнити вимоги кредиторів

7. Prove that you know 3 forms of these verbs:

to find, to classify, to refer, to take, to make, to bear, to lie, to enjoy, to run, to require, to meet, to borrow

8. Compose the sentences with the words:

1. are, control, and, in, ownership, person, one, vested.

2. organization, of, is, this, flexible, type, extremely.

3. risk, all, at, possessions, his, personal, are.

4. as, the, often, referred, is, business, it, to, one-person.

5. relatively, joint stock company, is, compared, unim­portant, it, the, with.

9. Insert the prepositions:

1. The different types ... business organization to be found ... the UK may be classified ... five headings.

2. This is the simplest form ... business enterprise and is often referred ... as the one-person business.

3. He is solely responsible ... the success... the business.

4. The strength... this type ... firm lies... the direct per­sonal interest... the proprietor in the efficiency... his business.

5. The owner is personally liable ... the debts incurred... his firm.

6. All his personal possessions are ... risk.

7. Another disadvantage ... the type of firm is the strict limitation ... its ability to acquire capital ... expansion.

8. Finance is restricted ... the amounts which the entre­preneur is able to provide ... his own resources and whatever sums he can borrow ... his own security.

10. Put questions to the italicized words:

1. The different types of business organization may be classified under five headings.

2. The owner is personally liable for the debts incurred by his firm.

3. The one-person business is prevalent in farming, retailing, repair and maintenance work.

4. A single person provides the capital, takes the deci­sions, and assumes the risks.

5. The oldest form of business enterprise is often referred to as the one-person business.

11. Fill in the banks with suitable form of the words:

1. The different types of business organization ... (to find) in the UK may ... (to classify) under five headings.

2. He ... (to have) the sole rights to such profits as may ... (to accrue) or, alternatively, … (to bear) the sole responsibility for such losses

3. The one-person business ... (to be) still far more numerous than any other type of business organization.

4. Ownership and control... (to vest) in one person who ... (to enjoy) all the fruits of success.

5. He ... (to have) no need ... (to consult) colleagues when changes of policy ... (to require).

6. We should ... (to expect) this type of organization ... (to be) extremely flexible.

7. All his personal possessions may ... (to seize) ... (to meet) creditors' demand.

8. Finance ... (to restrict) to the amounts which the entrepreneur is able ... (to provide).from his own resources and whatever sums he can ... (to borrow) on his own security.

12. Answer the questions:

1. What are the types of business organization to be found in the UK?

2. What is the simplest and oldest form of business enterprise?

3. What is the strength of the one-person business?

4. What are the disadvantages of this form of business organization?

5. Why is the one-person business less important com­pared with the joint stock company?

6. Where is the one-person business prevalent?

13. Retell text 'The sole proprietor'.

14. Read text B and prove advantages and disadvantages of the commercial activity of the firm.

Text В