The Definition of a Micro Businesses - Report Example

Task Micro Businesses Introduction Micro is a Greek word used to describe a lesser faction that is smaller than the standard measurement. When contrasted to other unit’s micro unit is the smallest existing unit. This unit examines the profit and non profit micro businesses, micro business types, strength and weaknesses of micro businesses and the emerging issues in the micro businesses (Knowles & Chris, 16). Profit Businesses A business is an enterprise that deals in the exchange of merchandise. Commerce can be categorized on the basis of profit and non-profit making operations. Their ownership can be private or public. Private businesses are determined for their longing to make profits, and as a result, they are the most common predominant forms of businesses around. Public businesses are managed by the government or the public, and they are state administered. A group of persons who come jointly for the purpose of operating a business activity forms a company. Corporations can be private or public possessions depending on the purpose and the owners intentions. Micro profit businesses are businesses that achieve considerable financial returns that reflect on the risks taken by the owners. The aim of micro profit businesses is profit maximization. Businesses are perceived to posses the necessary information concerning the products they are dealing in, and strategies that they ought to implement making the businesses a success. Non-Profit Businesses A non profit business uses the profit it makes to improve on the services it offers. Non profit organizations are designed for certain programs in the society. Most non-profit making businesses get subsidies from the government like duty service and government funding. A non-profit organization is a faction organized other than for the reason of making a profit. It does not share its profit to its owners or associates. Non profit businesses must serve the purposes stated in the statutes of a non profit making organization. Types of Micro Businesses A micro business is a small enterprise usually run by a sole partner and requires little starting capital. They are mostly family oriented, and relations affiliates play significant roles, in addition to having rights of, ownership. Examples of micro businesses are working from home, ‘franchise’ and ‘contractors’, ‘micro-business franchise opportunities’ and ‘E-business’. 1 Working from home includes professional services such as medical practitioners, solicitors and bankers. The administrative work and fee charge are done by the family member in charge and is done at the private resident of the owner. Most starts from meek beginnings like shops, restaurants and hair salons. They often progress and register them and may in some cases hire cheap labor from one to two people. 2 Contractors often work independently and hire out their services and time to clients and organizations that need their services. Examples of contractors include builders, caterers and private coaches. Outworkers negotiate their working terms and preparations and their compulsions differ from those of an employee. 3 A franchise is an agreement in which the initiator of a selling product (franchisor) gives a micro business owner (franchisee) the rights to sell these products on the franchisors behalf. Examples of this business are restaurants, cleaning business, lawn cutting, gardening and pet cleaning services. 4 E-business is a business that involves utilizing internet to run, advertise their services and perform their dealings. These businesses are on the rise with the popularity of internet usage, and the fact that they require little capital to start. Other business proprietors apply it to store information and advertise while others use it to provide information at a price. Strengths of the Micro Businesses The strengths of the micro business refer to the aspects that enable it to compete favorably with other businesses offering the same services or goods. They are flexibility factors, the capital, manageability and the income level. 1 Micro business always offers an individual with the opportunity and liberty to decide on what they are most comfortable with since an individual is his own boss. This freedom always enhances an individual’s labor performance, since there is little stress and pressures to meet and sometimes impossible, targets. Individuals work at their own leisure governed by their own rules (Knowles & Chris, 281). 2 These are minute business that needs little capital to start. They do not have need of expensive rental fees as they are run at the owner’s resident, and no bulk goods need to be purchased. Therefore, the capital is easier to find than macro businesses. 3 Micro commerce is easy to run, since it is petite. In most cases, they are run by one individual, and if help is needed the owners can hire not more than ten people, unless he/she moves the business out of the home area. 4 Since a micro business is an individual’s initiative, they become more passionate and zealous in their job. They need no supervision; they are careful and pump in a lot of hard work. All this is done to avoid failure and business closure. This hard work in turn elevates profit amounts and most people find they make more than being in formal employment. Weaknesses of the Micro Businesses Micro firm has a challenge of accessing the right amount of the capital smoothly runs their activities. They do not have the required finances and at most times relies on funds from relatives, donations, personal loans and loans to start and operate the business. Secondly they face the confrontation of retaining successful employees, since they are unfair their employee reimbursement. Lastly, micro businesses are for a short time ventures as their owners run them for subsistence purposes. Emerging Issues in the Operation Micro Businesses Emerging issue refers to the trends within the businesses that react negatively or positively on the business. The emerging issues in the micro businesses are Complying with modern awards, obedient faith bargaining, prosecutions and individual employee claims. 1 Employees feel that they are appreciated by their bosses when they are properly awarded. The procedure for awarding employees is an extremely difficult thing, since the standard criteria for awarding employees will be needed and this might lead to reduction in the profit revenue earned by micro business owner. The process of awarding the employees is highly competitive, and will also require that the employment condition is reviewed by the manager (Knowles & Chris, 183). 2 It refers to the procedure of mutual consideration between the customer and the owner of the business. It states that the two trading parties should both end at a win-win situation. It has profoundly influenced the operation of a small scale business, since most customer and business owner takes advantage of this fact and demands for the best when bargaining. 3 Individuals are constantly filing law suits against micro businesses for breeching the industrial relations controlling the operations of small businesses. Prosecution is a trend that worries the employer as they are in inconstant fear that they might be sued by their customers. 4 Employees are constantly claiming for compensation from the bosses in court proceedings. The employees are becoming extremely creative in laying their claims forcing the employer tot dearly compensate them for the claims (Knowles & Chris, 181). Conclusion Conclusively, micro businesses are businesses that are small in nature and can be profit or not profit oriented. There are various types of micro businesses that an individual can operate. A perfect example of a micro business is the E-business which requires the uses if internet in the running of the business. Several factors affect the operation of the business both negatively and positively. These factors are the strengths and weaknesses. Work Cited Knowles, Ronald, and Chris, Castillo. Small Business: An Entrepreneurs Plan. Toronto: Nelson Education, 2011. Print. Read More