Types of Spanish Companies: Sole Proprietorship, Trading Companies, Joint-stock Companies, Apuntes de Derecho

¡Descarga Types of Spanish Companies: Sole Proprietorship, Trading Companies, Joint-stock Companies y más Apuntes en PDF de Derecho solo en Docsity! BUSINESS ECONOMICS INTERNATIONAL BUSINESS DEGREE Z Es, E MIREIA PÉREZ CARRO CHAPTER 1 – Introduction to business economics Economics is a science that studies human behaviour as a rational activity to meet almost unlimited needs with limited goods that have alternative uses. 1. BASIC DEFINITIONS NEED: a need appears when we have a feeling of lack and the desire to eliminate that lack. GOOD: anything that satisfies a need. FREE ECONOMIC FINAL PRODUCER MATERIAL NON-MATERIAL FIRST ORDER X ORDER UTILITY: representation of preferences for some set of goods and services. As needs are subjective, utility depends on the consumer. VALUE: utility that a good has for a consumer (not the price). It is subjective and individual and affected by scarcity too. ç ECONOMIC RATIONALISM: CONSUMER max. satisfaction min. expenses PRODUCER max. incomes min. cost 1.3 Partnerships o Personal, unlimited and with solidarity responsibility o Small companies o Shares cannot be sold o The company will always have the same owners 1.4 Joint-stock companies o Limited responsibility (limited to contribution) o Owners can change, shares can be sold, the company has its own path SOCIEDAD COLECTIVA » Main idea: Unlimited, solidarity and subsidiary obligations » Incorporation: - Shareholders Board - Authorisation - Notary - Registration with public agency » Name: Name + “y compañía” » Capital: None » Owners: Minimum 2 » Governing Bodies: - Shareholders Board - Managing Partner - Financial controller SOCIEDAD COMANDITARIA » Main idea: two owners “Capitalistas” (or “colectivos”): unlimited, several subsidiary obligations “Comanditarios”: limited to contribution » Incorporation: - Shareholders Board - Authorisation - Notary - Registration with public agency » Name: Name of one of owners (must be “capitalista” type) » Capital: None » Owners: Minimum 2 » Governing Bodies: - Shareholders Board - Managing Partner - Financial controller SOCIEDAD ANÓNIMA » Main idea: To avoid problems faced by sole proprietors and partnerships, the S.A. gives the company its own personality and provides the shareholders with shares that can be sold and exchanged without problems. Shareholders have limited responsibility. » Incorporation: - Shareholders Board - Authorisation - Notary - Inscription in Companies Registry » Name: Name + “Sociedad Anónima” or S.A. » Capital: €60,010 » Owners: Shareholders (they have shares that can be sold) » Governing Bodies: - Shareholders Board - Directors Shareholders Board:  Shareholders’ meeting to govern the company and take decisions  25% of the shares must be represented  If important decisions have to be made (mergers, acquisitions, etc.), 50% of the shares are needed  All board calls must be made public 15 days before the meeting:  Ordinary Board: Must meet during the first 6 months of the fiscal year  Extraordinary Board: Can be convened by 5% of the shares or by Directors  Universal Board: if 100% of the shares vote for one Different kinds of companies Board of Directors:  Executive body that executes Shareholders Board’s orders and decisions  Represents the company to 3rd parties  Can be: • Single director • A number of directors who act in solidarity • 2 joint directors (the 2 of them must sign) • Board of Directors (board members, proxies, etc.)  Board members bear responsibility for any actions they take outside the law Shares:  Shares are small parts of the company’s capital stock  The share value is not the market price  Shareholders can take a portion of the profits  Shareholders can vote  Shareholders can go to the Shareholders Board  Shareholders can get information about the company’s situation  There are also non-voting shares SOCIEDAD LIMITADA » Main idea: S.A.s are too complex for PYMES, while S.L.S have limited liability without the inconvenience of the huge amount of paperwork of an S.A. S.L.s don’t offer shares but a % of the company. » Incorporation: - Shareholders Board - Authorisation - Notary - Inscription in Companies Registry » Name: Name + “Sociedad Limitada” or S.L. » Capital: €3,005 » Owners: They have a % of the company, but they don’t have paper (shares). » Governing Bodies: - Shareholders Board - Directors SOCIEDAD LIMITADA NUEVA EMPRESA » Main idea: S.L.s that can be created through internet. Easy and quick to make happen, this new kind of company aims to encourage new entrepreneurs and young people to set up companies. » Incorporation: - Shareholders Board - Authorisation - Notary - Inscription in Companies Registry » Name: Owner’s Name and Surname + “Sociedad Limitada Nueva Empresa” or S.L.N.E. » Capital: Minimum: €3,012; Maximum: €120,202 » Owners: Maximum 5 (only physical persons) → How to achieve concentration? Takeover: Some companies are acquired by other companies. The only legal form that will remain is that of the purchaser. Merger: Some independent companies decide to join forces and create a new company. They will lose their legal personalities and the new company will have all the capital and a new legal name. Groups of companies: All the companies keep their legal personality, but they also have a new legal personality that represents all of them:  Holding company: Group of companies with the sole purpose of achieving the maximum revenues for the group, not seeking to take advantage of the markets where the companies are operating. Usually it’s better (as an owner) to have only one company (the holding company) paying taxes than a large number of companies doing so.  Cartel: Illegal practice that big companies can engage in. The important companies in the market together decide prices, production standards, etc. to achieve maximum revenue. This usually pushes prices up and quality down. 3. CREATING A COMPANY To create a company, we need a BUSINESS PLAN: A business plan is a written description of your business's future. It is a document that describes what you plan to do and how you plan to do it. If you write down a paragraph on the back of an envelope describing your business strategy, you've written a plan, or at least the germ of a plan. The first section is the business concept, where you discuss the industry, your business structure, your particular product or service, and how you plan to make your business a success. The second is the marketplace section, in which you describe and analyse potential customers: who and where they are, what makes them buy and so on. Here, you also describe the competition and how you'll position yourself to beat it. Finally, the financial section contains your income and cash flow statement, balance sheet and other financial ratios, such as break-even analyses. This part may require help from your accountant and a good spreadsheet software program. 4. THE ENTREPRENEUR The key person is usually thought to be the capitalist or shareholder, the person who risks his money to create the company. Nowadays we make a distinction between capitalist and entrepreneur. Shareholders only receive dividends and profits, while the entrepreneur’s goals are closer to company survival and long-term prospects. The entrepreneur can be seen as: Shumpeter: Main duty is to innovate. Use technological inventions to increase company results and capabilities. Knight: Main duty is to take risks, risk own money and company’s money to get better results. According to Shumpeter, the entrepreneur’s profits are justified because of his innovation-oriented behaviour. According to Knight, the profits are justified because of the risk he or she is taking with his or her own money. So … who is the entrepreneur in a company? • Some authors say he or she is the main manager • Some say he or she is the owner • Some say he or she must be a shareholder and manager • Another group says he or she must be a shareholder and manager but klalso must show innovation-oriented behaviour. 5. MANAGING A COMPANY Management of the company:  Manage the company’s actions  Command productive factors  Combine Human Resources and Technical Resources to reach the company’s goals  Ensure the company adapts to changing conditions in the environment  Stimulate continuous quality improvement  Accumulate intangible assets (brands, public opinion…) Management System: System extended to all the company, relating the company to the environment, setting goals, developing plans and strategies, establishing the structure and control processes. Management Levels: 6. MANAGEMENT STAGES Process followed by a company’s management. It includes: - Planning - Organisation At a minimum - Control - Organising - Staffing - Directing - Coordinating - Reporting - Budgeting Top management: The company is a living being that must survive. Chairman, CEO and directors are at this level and have to develop long- term plans. They take decisions such as launching new products, acquiring other companies, and they supervise the general company behaviour. Middle management: The company must have as few problems as possible. Middle managers head industries and specific divisions, they develop short-term plans to achieve top management’s long-term ideas. They link operations managers with top managers. Operations management: They supervise workers and teams. They must assign jobs to employees and monitor their results. They have to execute middle management’s plans and be sure they are being carried out by workers. Other options CHAPTER 4 – The Company location 1. LOCATION FACTORS 1.1 Raw materials o Cost reduction o Location close to raw material producers o 5km is accepted as a good distance from our location to the raw materials o One of the most important factors, but it is not always the case that a company needs raw materials or that raw materials are so critical to the company 1.2 Energy o To reduce costs the company should be near power lines o If some specific energy is needed (solar, heat, oil, etc.), this should be considered o Access to energy must be as easy as possible (rivers, mountains, etc. can hinder access) 1.3 Labour o Qualified labour in the location? o Salaries? o Specific qualities (universities, tradition…) o Labour law? 1.4 Consumer market o Being close to the market gives a company the opportunity to change that market o The closer, the quicker o Cost reduction o Customers are closer, we can get more information about their preferences 1.5 Land o Cost? o Other companies around? o Infrastructure and services? o Rivers, mountains, weather? o Company concentration close? 1.6 Capital investments o Some locations have easier access to private capital than others o Proximity to financial cities increases the probability of receiving investment 1.7 Tax advantages o Some regions have special laws that apply to companies operating there o Better prices, specific infrastructure … o Tax discounts o Easier public investment 1.8 Social features o There are regions with more social activity than others o The power of labour is different also o The past may be important (bankruptcies, strikes…) o Media? 1.9 Economies of agglomeration o Lots of companies and people in the same area can produce: 1) Internal economies: The bigger the company, the lower the costs 2) Location economies: Different companies in the same activity located in the same area get lower costs and better services for all of them 3) Urban economies: Companies may improve, but consumers should improve too or the market won’t absorb production 1.10 Services and components supply o Companies need lots of services, and companies that offer those services include: - Lawyers - Cleaning - Components - PCs - Media 1.11 Waste recycling o Some companies (chemical, manufacturing …) produce tonnes of wastes that must be recycled o Laws on recycling are very strict, companies must be responsible for this activity o Location of recycling areas must be not far from company’s manufacturing plants 1.12 Dynamism of entrepreneurship o Money brings money o Government pays more attention to areas with higher dynamism o Better services and infrastructure o More competitors Better products