BBA Notes Business Organisation Role of FICCI Trade Association
BBA Notes Business Organisation Role of FICCI Trade Association : In This Article You Can Find MeaningTrade Association Business Organisation Notes and Forms of Business organisation,Points for a Good Forms of business Organisation, Role of FICCI, Salient Features of a Company Means That Its Is Best Topic of Business Organisation Study For Salient Features of a Company BBA 1st Semester Year . Here You Find Topic Wise,Chapter Wise, Subject Wise Study Material BBA And other Links of Related to the Business organisation . How To Learn BBA Business organisation Notes Forms of Business organisation,Points for a Good Forms of business Organisation, Merits of Partnership, You Here . Thanks For Read This Article.
Causes of business combinations Various
- Cut Throat Competition: Wasteful competition has been the most common cause of combinations is industry. Large scale production in anticipation of demand led to intense competition. In these conditions, factors are misused. The equilibrium between demand and supply is ruined. Unhealthy competition leads to wasteful expenditure. Combinations come into existence to check various competition.
- Benefits of Large Scale Production: Large scale production and distribution beings a number of internal and external benefits, small and uneconomical business firms, therefore, join hands to secure these benefits combinations to reduce costs of doing business and staying in business. The amalgamation of a bank is an example of a combination on account of this factor in India.
- To Face the Business Cycle: In almost every business, booms and depressions occur one after another. During the depression, inefficient and weak firms finding it difficult to survive, often sell themselves to large firms.
- To Desire to Control Market: Sometimes, a few businessmen desire to establish their control in the market of any product. Their main objective is to earn huge profits by doing so. By motivating with this thought they gather all businessmen dealing in that product, i,e., form a business combination. Such combinations are very common in industries comprising of few companies start working under one management then the business combination is established.
- Formation of Joint Stock Companies: Free transferability of shares in a public company enables acquisition of control in several enterprises. When one company purchases the majority of shares of other companies that it can easily control those companies. In this manner, when a few companies start working under one management then the business combination is established.\
- Rationalization: Measures for modernization, replacement, etc., require large finances and organized efforts. The complexity of modern production and distribution has also led to the integration of firms in an industry. Rationalization involves a combination of inefficient units to reduce wastage, to eliminate overproduction and to adopt new techniques.
- Need of More Quantity of Capita : To run the business on large scale, large quantity of money is required. The capacity of a small business unit to collect the capital is limited. In this condition, many small units form the combination to gather large amount of capital. This way, they can collect the large amount of capital as well as they get the load from banks at simple terms and conditions.
- The craze to be a Big Businessmen: To craze of being a bid businessman also give birth to business combination. The individual who develops this craze, he gather many business units and try to make it popular in one name (in his own name) only. If one person works hard and with great zeal, for him, it is not a tough task. In this manner, that person can gather many persons under one banner and can form business combination.
- To Take Advantage of Individual Managerial Ability: Nowadays, the demand for efficient manager is higher than their supply. In this condition. When certain units observe that an individual has excellent managerial capabilities, then all forms a combination collectively and enjoy the services of that person. Hence, the manager, who was not able to manage the units having separate identity, now can manage these units efficiently because now they have become one unit.
- To get Benefit from foreign Intelligence : To get benefit from the knowledge of foreign businessmen, business combination is established with foreign units. Whit these combinations, not only benefits of foreign intelligence are enjoyed but foreign units. With these combinations, not only benefits of foreign intelligence are enjoyed because also enters in india industry,
Rade Assciations (BBA Notes)
Trade Associations : It is a non-profit and voluntary organization formed by business enterprises operating in the same trade or industry for the promotion of mutual business interest. The general purpose of trade association is to improve the conditions in trade or industry, it meets raw materials. Labour of power, taxation etc. and tries to arrive at satisfactory solutions. It may be organized on local, regional or national levels. Almost every trade and industry today has its own association.
Example of Trade Associations : All India Manufacturer’s Organisation (AIMO), Confederation of Indian Industry (CII), All India Organisation of Employers (AIOE), Indian Jute Mills Association, Indian Sugar Mills Association, etc. are some examples of trade associations in India.
Functions of Trade Association
- To Stop the Unhealthy competition : Trade association try to check the unhealthy competition going on among its members.
- To Arrange the Industrial Research : These associations arrange for their members the industrial research and market survey. They make all attempts for the development of their members.
- To Solve the Mutual Problems : There are certain problems with which all the members of association suffer. These problems can be related with getting raw material, lack of means of transport, lack of power etc. trade association try to solve these problems.
- To Safeguard the Interest of the Members : Trade association represent their members and present their view on government policies. They also suggest for making new laws in business interest. They also help in solving business conflicts among their members.
Introduction of FICCI (BBA Notes)
Federation of Indian Chambers of Commerce and Industry (FICCI) came into existence in 1927 in New Delhi. It has its headquarter in New Delhi. It is a voluntary organization registered under the Indian Companies Act, 1913 as a non-profit body. It membership consists of over 50 chambers and trade association, 200 overseas member and 1,500 associate members which include individuals, firm and companies.
Objectives of FICCI
- To promote healthy interface between the business community and the government.
- To create conditions for the globalization of the Indian economy.
- To promote scientific research, import substitution and fullest possible utilisation of national resources.
- To work for deregulation of the economy by persuading the government to life administrative and other controls.
- To assist members in export promotion, modernization, quality control, pollution control, etc.
- To assist government in achieving socio-economic goals of removing poverty and increasing employment opportunities.
Role of FICCI (BBA Notes)
FICCI has led Indian business from the front and it has becomes the apex central body to protect and promote and promote the interests of business community. Some of its involvement in promoting business interests are given below:
- Set up of Committee : FICCI is represented on various advisory boards, communities and councils set up by the government and leading institutions. The Board of Trade, Central Advisory Council of Industries, Direct Taxes Advisory Commuittee, customs and bodies, FICCI has influenced the government policies concerning industrial licensing , foreign collaborations, plant location, capital issues, etc.
- Set up of Associate Bodies : FICCI has set up specialized bodies to cater sectorial interest of business. All India Organisation of Employers (ALOE), Indian National Committee of International
Chamber of commerce (INCICC), Indian Council of Arbitration (ICA), All India shipper’s council (AISC),Confederation of India food trade and industry (CIFTI), FICCI ladies organization (FLO), Economic and Scientific Research Foundation (ESRF) are associate organization of FICCI engaged in solving specific problems of Indian Business.
- Set up of Expert Committees: FICCI has set up several expert committees and task forces to keep track of the latest developments in the market environment and to study their impact on business. The subject-areas include informatics, industry, banking and finance, environment, taxation, and legal affairs, international trade, telecommunications, electronics technology, housing and construction, agriculture, management and HRD, international trade.
- Set up of joint Business Council: FICCI has set up a joint Business Council (JBC) with ASSOCHAM to promote exports and to develop sound business relations with other countries. JBC has entered into trade agreements with more than 50 countries and is a rallying point for Indian and overseas businessman.
- Library and Publications: FICCI has a well-established library having a large number of books and periodicals on business and industry. The journals published by FICCI are designed to update.
What do you Mean Amalgamation (BBA Notes)
Amalgamation : In order to reap the economies of scale and reduce or eliminate competition, two or more than two joint stock companies may combine their undertakings and become one joint stock company. It may be done either by one of the existing joint stock companies taking over the other combining company or companies, the latter being dissolved or by starting a new joint stock company takes over all the combining joint stock companies. Suppose, there are two joint stock companies A Ltd. And B Ltd. Now A Ltd. May take over the business of B Ltd. Which is dissolved or B Let. May absorb A Ltd. There is another choice. But A Ltd. And B Ltd. May be dissolved and the business of both the companies may be taken over by a newly formed joint stock company, say C Ltd. In all the three cases, we shall say that there is an amalgamation of A Ltd. According to Halsbury’s laws of England, “Amalgamation is a blending company becoming substantially the shareholders in the company which is carried on the blending company becoming substantially the shareholders in the company which is carried on the blended undertakings. There may be amalgamation either by transfer of two or more undertakings to a new company or by the transfer of one or more undertakings to an existing company.”