BUSINESS and BUSINESSES

Abstract: Business is a long term, highly

repetitious activity, frequently requiring people to
do the same thing today, tomorrow, the next day.
Business is the production, buying and selling
of goods and services.

Key words: business, partners, joint
stock, shareholders, stakeholders, company.

Many of todays well known businesses
were started by one or two people and the
ownership of those businesses was very simple. It
was during the 19th century that businesses
wanted to expand and increase the number of
owners. To do this they needed to sell shares. To
encourage people to buy shares, governments
around the world passed laws which gave people
limited liability. During the 20th century many
people bought shares in sucessful businesses for
the following reasons:
- to have a share in the profit made by
the business.
- the hope that a profitable business
would attract more and more people to buy
shares and this will make the price rise so that
shares could be sold at a profit.
The simplest form of business ownership
is the sole trader. Here, one person owns the
business, takes all the decisions and risks his own
money. People enjoy to be self employed and
they are happy to have complete control of their
own business. But there is no one to share the
responsibilities involved in decision making and
raising finance is a problem. Sole traders finance
their business through a bank loan and the bank
will charge a high rate of interest. A bank will
ensure that it can get the money back, if the loan
is not repaid, by requiring security on the loan.
Sole traders are liable for any debts they have,
even if they are not the traders fault. A trader
may do a job for a larger business; it may be
worth 20 000$ but it will not be paid until the job
is complete. The sole trader must spend 9 000 $
on equipment, but when the job is complete the
larger business closes down and the 20 000$ are
not paid; still, the sole trader has to cover the 9
000 already spent as he has unlimited liability.
Sometimes, a pair of a small group of
people will get together to run a business. This is
called a partnership. Partnerships face unlimited
liability as sole traders do.
Partners may put some money into the
partnership in return for a share of the profits but
take no part in the running of the partnership, do
not work for it and have no say in any
decisions.Under these circumstances, it is only
the money that has been invested that is liable to
be used in order to apy off any debts. This is a
silent partner and he has only limited liability.
The technical name for both private and
public limited companies is joint stock company.
It means that the stock in a company is owned
jointly by several people.
Some business activity is carried on by
the government and this forms the public sector.
Profit maximisation may not be the only
aim of a business; in public companies, there is a
separation of ownership and control, so that
directors and managers may run a company in
their own interests.
Business is the production, buying, and
selling of goods and services. A business,
company or firm is an organization that sells
goods or services. A business may be referred to
formally as a concern. Then, it may be referred to
approvingly as an enterprise in order to
emphasize its adventurous, risk taking qualities
and business in general may be referred to in the
same way, in combinations such as free
enterprise and private enterprise.
A business requires tremendous effort to
get it going and once going, it requires minimum
effort to keep it going. The role of business is to
stay in business, providing wages, goods and
services into the community and meeting the
profit needs of the business and the key
stakeholders in the business. The source of
funding and capital is considered to be the main
difference between the stakeholders and the
shareholders. In the stakeholder model, funding
is being supplied through bank loans. This means
that they will ask for managerial consideration
and response from those running the company.
In the shareholder model, stockholders
advance capital to managers who act as their
agents in pre-authorized ways. Shareholders buy
shares to maximise the return on their
investment; the responsibility of the manager in a
firm is to engage in activities designed to
increase the profits that is to engage in open and
free competition. To create shareholder wealth,
the management needs to outperform the
expectations shareholders had when they made
their investment decisions. In the shareholder
model of corporate governance, the focus is on
institutional agents monitoring corporate agents
in order to enhance the investment prospects of
investors. In the stakeholder model, the premise
is that a company is more likely to perform well
and the shareholders are more likely to benefit, if
opportunities are created for the various groups
holding an interest in the company to enter into
binding relationship. The emphasis in the
stakeholder model is the way enterprises are
governed while in shareholder model the
emphasis is on the way enterprises are managed.
The shareholder based entity is more responsive
to changes in market conditions.
Both approaches take account of the
issues of board checks and balances, abuse of
authority and power, the role of boards, director
rewards and participation in setting standards for
accounting, safety, employee relations and risk
management.
In todays business world we have to take
into consideration the two models. The
shareholder model encourages a top down,
command and control leadership approach
whereas in the stakeholder model a team based,
shared decision-making, servant leadership
approach is more likely.
Stakeholder based governance refers to
how the organization makes cost effective
decisions in terms of wealth creation but with
consideration of stakeholders rights.
Corporations have multiple responsibilities and
need to balance competing conditions, such as
long and short term notion of gain, profit and
sustainability, cash and accounting concepts of
value, democracy and authority, power and
accountability. This model is more common in
continental Europe and Japan.
Then business may be referred to as
commerce, commercial distinguishing the
business sphere from other areas such as
government or arts or from non money making
activities.
Large companies are being referred to as
corporations. Corporate is used to describe things
relating to a corporation or to corporations. Large
companies operating in many countries are
multinationals. Big business can refer to large
business organizations or to any business activity
that makes a lot of money. Small companies are
referred to as small businesses or small firms.
If a company A owns shares or equity in
company B, then A holds a stake, holding or
shareholding in B. If A owns less than half the
shares in B, then it has a minority stake in B. If A
owns more than half the shares in B, it has a
majority stake or controlling stake in B. If you
have shares in a company you are a shareholder.
A holding or holding company is the one
that holds stakes in one or more subsidiaries. If it
owns all the shares in a subsidiary, then the
subsidiary is a wholly owned one. A holding
companys relationship to its subsidiaries is that
of parent company and the subsidiaries
relationship to each other is that of sister
companies. A holding and its subsidiaries form a
group. A conglomerate is a group containing a lot
of different companies in different businesses.
Company A may be attempting to gain
control of company B in a takeover bid, maybe
by increasing its holding or stake in company B if
it already owns shares in B. Company B makes
or launches a bid against company A, the
takeover target. If company B does not want to
be taken ober, the bid is hostile. There are other
ways of saying that one company is taking over
another one and it means that the company is
acquiring another or making an acquisition.
Any business requires true
professionalism- the courage to care about
people, clients, career.
True professionalism means the pursuit of
excellence. If you value something, then you
must monitor your performance in that area,
acept nothing less than excellence and actively
work to learn what to do differently every time
you fall short of excellence. Firms must provide
help and counsel to those who are encountering
difficulties in living uo to their standards, in order
to help them get back on track. Once
professionals have confirmed their core values,
they need to design systems which provide
consequences for noncompliance. By leaving
each individual professional to decide for himself
what level to achieve in key value areas, firms
say that the company as a society has no
standards that must be adhered to. Excellence in
such areas become a matter of personal
professional choice. Professionals must live by
the slogan you are allowed to fail, you are not
allowed to give up trying.
The opposite of the word professional is
not unprofessional, but rather technician. These
may be highly skilled, but they arent
professionals until they demonstrate
characteristics such as: taking pride in their work,
showing a personal commitment to quality,
reaching out for responsibility, getting involved,
looking for ways to make things easier for those
they serve, listening to the needs of those they
serve, being team players, honest, trustworthy,
loyal, open to constructive critiques.
Professionalism is an attitude not a set of
competences. A true professional is a technician
who cares. And if finding people with technical
skill is usually easy, finding people who are filled
with energy, drive, enthusiasm personal
commitment to excellence is hard. Because real
professionalism has little to do with which
business you are in, what role within that
business you perform, how many degrees you
have. It implies a pride in work, a commitment to
quality, a dedication to the interests of the client,
a sincere desire to help.
Traditional definitions of
professionalism are filled with references to
status, educational attainments, noble calling.
Now, we refer to attitude and character. So, firms
should hire people for attitude and train for skill.
Being a professional asks for treating people as
professionals that is invest in them. Then
professional success requires more than talent, it
asks for initiative, involvement, enthusiasm,
commitment. Being good at business
development involves nothing more than a
sincere interest in clients and their problems and
a willingness to go out and spend the time being
helpful to them.

Questions:

1. What is the simplest form of business
ownership?
2. What does any business require?
3. Which are the differences between
shareholders and stakeholders?
4. What are large companies referred to
as?
5. What does any business require?

Fill in:

Professionalism is an attitude not a set of
______________. A true professional is a
______________who cares. And if finding
people with technical skill is usually easy,
finding ______________who are filled with
energy, drive, enthusiasm personal commitment
to excellence is hard. Because real
______________has little to do with which
business you are in, what role within that
______________you perform, how many degrees
you have. It implies a pride in work, a
______________to quality, a dedication to the
interests of the client, a sincere desire to help.
Test Your English

I. Select the correct answer:
1. People .............. that the Irish love to talk a lot.
a) tell b) say c) speak d) are telling
2. Samuel Beckett .............. born in Dublin in 1906.
a) is b) was c) has been d) had been
3. The Republic of Ireland has been independent ..............
over seventy years.
a) by b) since c) for d) during
4. Dublin ............................ its millennium in 1988.
a) celebrated b) has celebrated c) had celebrated d)
celebrates
5. Many of the students go to our trainings .............. foot.
a) on b) to c) by d) at
6. "If I ............................ my life to live over", as the song
goes, "I would do it all over again".
a) have b) had c) would have d) have had
7. "Ah yes," said the old man, "if Id had time, I ...............
the world."
a) would see b) saw c) would have seen d) had seen
8. People should get full and truthful ............................
from the media.
a) information b) informations c) informs d)
informationen
9. "Is there ............................ there? " said the traveller,
knocking on the moonlit door.
a) somebody b) anybody c) a body d) someone
10. We should all work ............................ to save our
planet from destruction.
a) hard b) hardly c) hardest d) the hardest
MICROECONOMICS AND
MACROECONOMICS
Abstract
Macroeconomics is the study of the
economy as a whole.
The distinction between
microeconomics and macroeconomics is more
than the difference between economics in the
small and economics in the large, which the
Greek prefixes micro and macro suggest.

Keywords: macroeconomics, microeconomics,
economy, business.

Many economists specialize in a
particular branch of the subject. For example,
there are labour economists, energy economists,
monetary economists, and international
economists. What distinguishes these economists
is the segment of economic life in which they are
interested. Labour economics deals with
problems of the labour market as viewed by
firms, workers, and society as a whole. Urban
economics deals with city problems: land use,
transport, congestion, and housing. However, we
need not classify branches of economics
according to the area of economic life in which
we ask the standard questions what, how, and for
whom. We can also classify branches of
economics according to the approach or
methodology that is used. The very broad
division of approaches into microeconomic and
macroeconomic cuts across the large number of
subject groupings cited above.
Microeconomic analysis offers a detailed
treatment of individual decisions about particular
commodities.
For example, we might study why
individual households prefer cars to bicycles and
how producers decide whether to produce cars or
bicycles. We can then aggregate the behavior of
all households and all firms to discuss total car
purchases and total car production. Within a
market economy we can discuss the market for
cars. Comparing this with the market for
bicycles, we may be able to explain the relative
price of cars and bicycles and the relative output
of these two goods. The sophisticated branch of
microeconomics known as general equilibrium
theory extends this approach to its logical
conclusion. It studies simultaneously every
market for every commodity. From this it is
hoped that we can understand the complete
pattern of consumption, production, and
exchange in the whole economy at a point in
time.
If you think this sounds very complicated
you are correct. It is. For many purposes, the
analysis becomes so complicated that we tend to
lose track of the phenomena in which we were
interested. The interesting task for economics, a
task that retains an element of art in economic
science, is to devise judicious simplifications
which keep the analysis manageable without
distorting reality too much. It is here that
microeconomists and macroeconomists proceed
down different avenues. Microeconomists tend to
offer a detailed treatment of one aspect of
economic behaviour but ignore interactions with
the rest of the economy in order to preserve the
simplicity of the analysis. A microeconomic
analysis of miners wages would emphasize the
characteristics of miners and the ability of mine
owners to pay. It would largely neglect the chain
of indirect effects to which a rise in miners
wages might give rise. For example, car workers
might use the precedent of the miners pay
increase to secure higher wages in the car
industry, thus being able to afford larger houses
which burned more coal in heating systems.
When microeconomic analysis ignores such
indirectly induced effects it is said to be partial
analysis.
In some instances, indirect effects may
not be too important and it will make sense for
economists to devote their effort to very detailed
analyses of particular industries or activities. In
other circumstances, the indirect effects are too
important to be swept under the carpet and an
alternative simplification must be found.
Macroeconomics emphasizes the interactions in
the economy as a whole. It deliberately
simplifies the individual building blocks of the
analysis in order to retain a manageable analysis
of the complete interaction of the economy. For
example, macroeconomists typically do not
worry about the breakdown of consumer goods
into cars, bicycles, televisions, and calculators.
They prefer to treat them all as a single bundle
called consumer goods because they are more
interested in studying the interaction between
households purchases of consumer goods and
firms decisions about purchases of machinery
and buildings.
Macroeconomics is the study of the
economy as a whole.
Macroeconomics is concerned not with
the details the price of cigarettes relative to the
price of bread, or the output of cars relative to the
output of steel but with the overall picture.
The distinction between microeconomics
and macroeconomics is more than the difference
between economics in the small and economics
in the large, which the Greek prefixes micro and
macro suggest. The purpose of the analysis is
also different.
A model is a deliberate simplification to
enable us to pick out the key elements of a
problem and think about them clearly. Although
we could study the whole economy by piecing
together our microeconomic analysis of each and
every market, the resulting model would be so
cumbersome that it would be hard to keep track
of all the economic forces at work.
Microeconomics and macroeconomics take
different approaches to keep the analysis
manageable.
Microeconomics places the emphasis on a
detailed understanding of particular markets. To
achieve this amount of detail or magnification
many of the interactions with other markets are
suppressed. In saying that a tax on cars reduces
the equilibrium quantity of cars we ignore the
question of what the government does with the
revenue. If government has to borrow less money
it is possible that interest rates and the exchange
rate will fall and that improved international
competitiveness of U.K car producers will
increase the equilibrium output of cars in the
U.K.
Microeconomics is a bit like looking at a
horse through a pair of binoculars. It is great for
details but sometimes we get a clearer picture of
the whole race by using the naked eye. Because
macroeconomics is concerned primarily with the
interaction of different parts of the economy, it
relies on a different simplification to keep the
analysis manageable. Macroeconomics simplifies
the building blocks in order to focus on how they
fit together and influence one another.

The main issues in macroeconomics:
1.Inflation the annual inflation rate is the
percentage increase per annum in the average
price of goods and services.
What causes inflation? The money supply? Trade
unions?
Why do people mind so much about inflation?
Does it cause unemployment?
2.Unemployment. It is a measure of the number
of people registered as looking for work but
without a job. The unemployment rate is the
percentage of the labour force that is
unemployed. The labour force is the number of
people working or looking for work. It excludes
all those from rich landowners to heroin addicts-
who are neither working nor looking for work.
.Why has it increased so much?Are workers
pricing themselves out of jobs by greedy wage
claims? Is high unemployment necessary to keep
inflation under control, or could the government
create more jobs?
3.Output and Growth .Real gross national
product measures the total income of the
economy. It tells us the quantity of goods and
services the economy as a whole can afford to
purchase. Increases in real gross national product
are called economic growth.
-What determines the level of real GNP? Why do
some countries grow faster than others?
4. Macroeconomic policy. Almost every day the
newspapers and television refer to the problems
of inflation, unemployment, and slow growth.
These issues are widely discussed; they help
determine the outcome of elections, and make
some people interested in learning more about
macroeconomics. The government has a variety
of policy measures through which it can try to
affect the performance of the economy as a
whole. It levies taxes, commissions spending,
influences the money supply, interest rates, and
the exchange rate, and it sets targets for the
output and prices of nationalized industries.
What the government can and should do
is the subject of lively debate both within the
field of economics and in the country at large. As
usual, it is important to distinguish between
positive issues relating to how the economy
works and normative issues relating to priorities
or value judgements.

Economic Growth
There is general agreement amongst
economists concerned with the problems of less
developed countries (LDCs) that a distinction
should be made between economic growth and
economic development.
Economic growth is defined as an
increase in the productive capacity of an
economy over time, giving rise to an increase in
real National Income (NI). If the rate of growth
of income is greater than the rate of growth of
population, income per capita will also rise.
Economists distinguish between the Gross
Domestic Product (GDP) and the Gross National
Product (GNP) of an economy. GDP is the total
final output of goods and services produced
within an economy for any given year, by both
residents and non-residents. GNP is equal to
GDP plus net factor (or property) incomes from
abroad (that is, the difference between returns to
the inhabitants of the country from property
located overseas minus the returns accruing to
foreigners from their property located within the
reporting country). For most LDCs, net property
income from abroad is likely to be negative and
thus GDP will be greater than GNP.
Both domestic product and national
product can be expressed in net terms (that is,
after allowing for capital depreciation) and either
at market prices or factor costs (that is, including
and excluding respectively, indirect taxes net of
subsidies). Net National Product (NNP) at factor
cost is identical to National Income.
For many LDCs, economic growth has
been rapid and sustained for much of the post-
Second World War period. World Bank
projections for the 1980s predicted that higher
rates of economic growth would be difficult to
reach and sustain and that there would occur a
widening in both the relative and absolute gaps
between the richest and the poorest countries,
including the gap between the middle- and low-
income LDCs.
In the early years of the evolution of
development economics as a distinct area of
study, economic growth and economic
development were generally seen as being
synonymous. The deficiencies of using GNP per
capita as an indicator of economic welfare (and
by implication, the level of economic
development) were recognised by economists,
however, and over time it became increasingly
evident that economic growth on its own,
although undoubtedly a necessary condition, was
certainly not a sufficient condition to ensure
increases in economic, let alone social,
welfare.Within the concept of economic
development was some notion of progress.
Economic development meant growth plus
structutal and institutional change which involved
the move towards certain normative goals or
objectives.Growth without development was a
possibility if increases in per capita incomes were
not accompanied either by structural changes or
by the diffusion of the gains in real income
among all sectors of the population.


Questions:
1. What is microeconomics?
2. What is macroeconomics?
3. What causes inflation?
4. What are the main issues in
macroeconomics?
5. How would you define economic growth?

Fill in:
______________ places the emphasis on
a detailed understanding of particular
______________. To achieve this amount of
detail or magnification many of the interactions
with other ______________ are suppressed. In
saying that a tax on cars reduces the
______________ quantity of cars we ignore the
question of what the government does with the
revenue.
______________ growth is defined as an
increase in the productive capacity of an
______________ over time, giving rise to an
increase in real National ______________ (NI).
If the rate of ______________ of income is
greater than the rate of growth of
______________, income per ______________
will also rise.
Test your English

Fill the gaps with the following words:
agents economy England income issues
macroeconomics performance predictable
systems variables

Macroeconomics is the study of whole economic
(1)______________ aggregating over the
functioning of individual economic units. It is
primarily concerned with (2)______________
which follow systematic and (3)______________
paths of behaviour and can be analysed
independently of the decisions of the many
(4)______________ who determine their level.
More specifically, it is a study of national
economies and the determination of national
(5)______________.Macroeconomics considers
the performance of the (6)______________ as a
whole. Many macroeconomic
(7)______________ appear in the press and on
the evening news on a daily basis. When we
study (8)______________ we are looking at
topics such as economic growth; inflation;
changes in employment and unemployment, our
trade (9)______________ with other countries
(i.e. the balance of payments) the relative success
or failure of government economic policies and
the decisions made by the Bank of
(10)______________.

Match the words on the left with their
definitions on the right:

1. price a. The study of the
behavior of entire
economies.
2. GDP b. The study of individual
elements of the economy
3. economy c. The value of all goods
and services produced
within a nation in a given
4. macroeconomics d. The organization of
production and distribution
of goods and services
within a socioeconomic
system.
5. microeconomics e. The amount of money
needed to purchase
something

THE COMPANY


Abstract: A company is a very special
form of business. It is owned by the shareholders
but has a separate legal existence from the people
who own it. The shareholders elect a board of
directors to run the company on their behalf. If the
company has 2- 50 shareholders it is a private one.

Key words: shares, professionals, team,
leadership, management, to perform.

In business we must create for ourselves a
set of attitudes and values that balance the
conflicting factors, enabling us to act effectively
with integrity, dignity, understanding. So well
have better relationships with our partners and
our life becomes richer. Emotional containment
ensures then that the business values are not
undermined by other values from our society,
such as we perhaps learned early in life. The
liability is limited to the money that the
shareholders have used to buy shares. If the
shares are traded on the stock exchange we have
a public limited company. Members of the public
can buy these shares by going through a
stockbroker or bank.
We then have to know that there is no
social health without economic wealth; the role
of business is to stay in business, providing
wages, goods and services into the community
and meeting the profit needs of the business and
the key stakeholders in the business.
The business does not operate in a
vacuum; there are competitors, there is a level of
economic activity, there is rapidly changing
technology.
The visions we have for our businesses
are what makes them and us successful. Setting
goals and objectives will help us achieve our
vision. The key to success and happiness in life is
to create a positive vision, to remain true to ones
own spirit, to have the energy of challenge.
But running a business is never easy. Its
a ride through a range of hazards and difficulties
but one thing is sure: life will rarely, if ever, be
dull. If you do not enjoy running your business,
you cant expect to do it well.
Some ways to make a business successful
are the following:
1. Ideas- bad or good- are important as the
lifeblood of business and vital to its long term
success. Ideas are vital to develop new or existing
products or services or even to take the first step
into a new business.
2. Choosing professional advisers is
essential and they can make or break your
business.
3. Finding and keeping clients must form
an integral part of your planning if you want to
grow your business.
4. Research your target companies does
take time, but its well spent. If knowledge is
power, then researching a company can give you
a much better understanding of what they do and
help you to prepare a successful bid.
5. Brand your business and youll be set
apart and enable you to introduce a wider range
of products and services more easily.
6. Team up with another business to
enhance yours and be competitive on the market.
7. Consider a project based working
which has many advantages for the employer and
employee. This means working for just one or
two employers at any time.
8. Be creative, have an open mind
philosophy and a I can do attitude. Any
business can benefit from using it creatively.
9. Focus on creating a win/win situation.
10. Use your time wisely, as it is not
elastic and it will not magically expand to
accommodate all we have to do.
A business is a coordinated effort to
achieve certain ends summarized in the profit and
loss. Joining a business means embracing some
part of that at least. The assumption is that
everyone wants to be successful and for this
within a company, it is important to consolidate
the aims of the team, the team spirit, understand
the teams effort to strive for achievements, focus
on creating a team climate, understand the energy
of challenge, be aware on ones responsibility.
Desire or will is the very essence of
success. Without this intensity the actions of
success have a hollowness, the hallmark of but I
tried.
Successful business asks for good
leadership and this is not some mystical act
performed by the few and only able to be
performed by them through some luck of
upbringing or genetics that made them natural
leaders. We can become better leaders than we
are; to achieve this means that we need to do the
right things at the right time more often than we
usually do and we also need to examine
ourselves. We also need to have a clear idea of
what to do in order to gain the best possible result
from others. The actions identified must be the
appropriate actions in what is broadly called
western society(North America, U.K., Europe,
Australia, New Zealand).
Leadership is to be taken into account
whenever we have in view any business; there
are some steps to be followed:
1. The agreement to success for every
team member. Everyone wants to be successful
as far as goals are clear and business processes
are far from being clumsy. Everyone has positive
and negative thoughts in their minds most of the
time. We know how easy it is for the negative
thoughts: the company is not good, the boss is
badWe represent the positive assertively in our
mind- work is rewarding. But we select our
thoughts and they influence us. If a person has
negative thoughts about the job and the company,
work performance is suffering. The negative
impact can make the team output less than it
should otherwise be. But we are responsible for
our own thoughts, so what a manager can do is to
point out the consequences. It is clear that when
the team becomes focused, gets people
organized, celebrates success, then bad attitudes
disappear.
Defining success entails the idea of
challenge which energizes people.
Team leaders and managers must live as
exemplary models of how they expect others in
their team to act. Each management team
member is expected to be an inspiring player.
The team effort has to be understood properly.
The team spirit must be a consequence of doing
other things well. Coordinating the effort is to be
achieved by the profit profile with each team
member being accountable for some number on
the profile and this will define success for a team.
People have seen now the standards required.
Identifying the behaviours of success. As
the goals have been agreed, the steps to be
followed are to make clear what actions were
most likely to bring about the goals.
In the goal-action principle, the idea of
action becomes clear now, we have those
behaviours that will best fulfill the goal, derived
from the goal and belonging to it. It is important
to find the balance between two things in conflict
as a crucial act of insight and creativity for the
manager and the team. If the issue is finding sales
tactics, then the problem is one of creativity for
the team to brainstorm possible tactics and then
select one or several that best achieves the
balance of the required result.
Provide monitoring and feedback on
progress and performance. The main concern
among the teams was to provide useful guidance
on what should be changed to improve the
results. Better reports were being sought, better
information.
Celebrate success, large and small. Teams
celebrate success as people have risen to the
challenge. Team results were evident. The
progressive build up of life satisfaction was
something that occurred beneath the daily flux
and it should increase each year. It was seen as
related to goals and work had the potential to be a
major component.
Teams will remain the core of the
business. Before demanding better performance
one have to be sure that this can be achieved. So,
for every goal there are tasks that must be acted
out if the goal is to be achieved. Everyone
succeeds if the team succeeds. It is important to
recognize individual performance, but from
within the framework of the team.
A management team should be a team,
not a collection of individuals with personal
accountability. This means that every team
member understands that they can win only if the
team wins and the team wins by achieving the
targeted operating profit. Within that, each
person has his or her role and tasks within this
role. If people can fully perform their own jobs
and have the mental, emotional and physical
energy to assist others, and if the others accept
and appreciate the assistance, then those people
should be encouraged and celebrated within the
team.
A management team operates within the
framework and policy prescribed by the strategic
plan and is accountable for creating sales revenue
and converting it into operating profit.
To develop a manager means to develop
the person. That is, to improve business
management or business leadership is not merely
an act of adding some skills or some knowledge
to the person; knowledge alone is not power;
only if it is backed by the ability and willingness
of how, the judgement of when to use that
knowledge is power.

Questions
1. What does running a business
entail?
2. Which are the ways we can make
a business successful?
3. What is important in business life?
4. Why is leadership important?
5. Why are teams important in
business life?

Fill in:
Team ___________ and managers must
live as exemplary models of how they expect
others in their team to act. Each ___________
team member is expected to be an inspiring
player. The team effort has to be understood
properly. The team ___________ must be a
consequence of doing other things well.
Coordinating the ___________ is to be achieved
by the profit profile with each team member
being ___________ for some number on the
profile and this will define success for a team.
___________ have seen now the standards
required.
Test Your English

I. Fill in the gaps with the following words:
down, off, off, on, up to.
1. It is time I was (1)__________ or I will be
late for the meeting.
2. He has been very (2)_____ ______since he
lost his job.
3. I am going to London because the sales are
(3)___________.
4. I think this milk is (4)____________. Smell
it.
5. Why all the whispering? What are you
(5)___________?

II. Have you ever been to an English speaking
country before? If so, please give brief
details. If your answer is no, what English
speaking country would you like to visit
and why? (150 words!)

INTERNATIONAL TRADE

Abstract
International trade includes all economic
transactions that are made between countries.
Among the items commonly traded are
consumer goods, such as television sets and
clothing; capital goods, such as machinery;
and raw materials and food. Other
transactions involve services, such as travel
services and payments for foreign patents.
International trade transactions are facilitated
by international financial payments, in which
the private banking system and the central
banks of the trading nations play important
roles.
Keywords: international trade, business,
transactions, economy, economics.

The theory of international trade

Accounts of barter of goods or of services
among different peoples can be traced back
almost as far as the record of human history.
International trade, however, is specifically an
exchange between members of different nations,
and accounts and explanations of such trade
begin (despite fragmentary earlier discussion)
only with the rise of the modern nation-state at
the close of the European Middle Ages. As
political thinkers and philosophers began to
examine the nature and function of the nation,
trade with other nations became a particular topic
of their inquiry. It is, accordingly, no surprise to
find one of the earliest attempts to describe the
function of international trade within that highly
nationalistic body of thought now known as
"mercantilism." Mercantilist analysis, which
reached the peak of its influence upon European
thought in the 16th and 17th centuries, focused
directly upon the welfare of the nation. It insisted
that the acquisition of wealth, particularly wealth
in the form of gold, was of paramount
importance for national policy. Mercantilists took
the virtues of gold almost as an article of faith;
consequently, they never undertook to explain
adequately why the pursuit of gold deserved such
a high priority in their economic plans.
The trade policy dictated by mercantilist
philosophy was accordingly simple: encourage
exports, discourage imports, and take the
proceeds of the resulting export surplus in gold.
Because of their nationalistic bent, mercantilist
theorists either brushed aside or else did not
realize that, from an international viewpoint, this
policy would necessarily prove self-defeating.
The nation that successfully gains an export
surplus must ordinarily do so at the expense of
one or more other nations that record a matching
import surplus. Mercantilists' ideas often were
intellectually shallow, and indeed their trade
policy may have been little more than a
rationalization of the interests of a rising
merchant class that wanted wider markets--hence
the emphasis on expanding exports--coupled with
protection against competition in the form of
imported goods. Yet mercantilist policies, as will
be noted later, are by no means completely dead
today.
Comparative Advantage Analysis

The British school of "classical economics"
began in no small measure as a reaction against
the inconsistencies of mercantilist thought.
Adam Smith was the 18th-century founder of
this school; his famous work, The Wealth of
Nations (1776), is in part an antimercantilist
tract. In The Wealth of Nations, Smith
emphasized the importance of specialization as a
source of increased output, and he treated
international trade as a particular instance of
specialization: in a world where productive
resources are scarce and human wants cannot be
completely satisfied, each nation should
specialize in the production of goods it is
particularly well equipped to produce; it should
export part of this production, taking in exchange
other goods that it cannot so readily turn out.
Smith did not expand these ideas at much length;
but David Ricardo, the second great classical
economist, developed them into the "principle of
comparative advantage," a principle still to be
found, much as Ricardo spelled it out, in every
textbook on international trade.
Simplified theory of comparative advantage

For clarity of exposition, the theory of
comparative advantage is usually first outlined
as though only two countries and only two
commodities were involved, although the
principles are by no means limited to such cases.
Again for clarity, the cost of production is usually
measured only in terms of labour time and effort;
the cost of a unit of cloth, for example, might be
given as two hours of work. The two countries
will here be A and B; and the two commodities
produced, wine and cloth. The labour time
required to produce a unit of either commodity in
either country is as follows:

cost of production (labour time)
country A country B
wine (1 unit) 1 hour 2 hours
cloth (1 unit) 2 hours 6 hours

As compared with country A, country B is
productively inefficient. Its workers need more
time to turn out a unit of wine or a unit of cloth.
This relative inefficiency may result from
differences in climate, in worker training or skill,
or in the amount of available tools and
equipment, or from numerous other possible
reasons. Ricardo took it for granted that such
differences do exist, and he was not concerned
with their origins. Country A is said to have an
absolute advantage in the production of both
wine and cloth because it is more efficient in the
production of both goods. Accordingly, A's
absolute advantage seemingly invites the
conclusion that country B could not possibly
compete with country A, and indeed that if trade
were to be opened up between them, country B
would be competitively overwhelmed. Ricardo
insisted that this conclusion is false. The critical
factor is that country B's disadvantage is less
pronounced in wine production, in which its
workers require only twice as much time for a
single unit as do the workers in A, than it is in
cloth production, in which the required time is
three times as great. This means, Ricardo pointed
out, that country B will have a comparative
advantage in wine production. Both countries
will profit, in terms of the real income they enjoy,
if country B specializes in wine production,
exporting part of its output to country A, and if
country A specializes in cloth production,
exporting part of its output to country B.
Paradoxical though it may seem, it is preferable
for country A to leave wine production to country
B, despite the fact that A's workers can produce
wine of equal quality in half the time that B's
workers can do so.
To illustrate this conclusion, it can be
considered that country A's total labour force
consists of 300 workers. Disregarding the
possibility of trade with B, A then has a choice of
various outputs of cloth and of wine, depending
on the number of workers engaged in each of the
two occupations. This range of choices is
illustrated by the line DEF in the accompanying
diagram. If all 300 labourers work on cloth
production, total hourly cloth output will be 150
units (point D in the diagram), since each such
unit requires two hours' labour. At the other
extreme, if all labour works on wine production,
wine output will be 300 units per hour (point F).
Any intermediate point on the line DEF is
possible. Point E, for example, indicates 80 units
of cloth produced each hour (160 workers so
employed) and 140 units of wine (employing the
other 140 workers). DEF is country A's
"production possibility" line. If it does not trade
with country B and so can consume only what it
produces itself, DEF will also be country A's
"consumption possibility" line; it will choose
some point thereon, depending on the preferences
of its citizens for wine and cloth. DEF represents
the limit of production and consumption
possibilities; points above and to the right of DEF
are unattainable.
In the right-hand diagram, the line GHJ
has exactly the same production and consumption
significance for country B--assuming its total
force to be 600 workers (so as to make it roughly
equal to A in total output capacity). The position
of the line GHJ reflects the fact that labour in
country B requires two hours to produce a unit of
wine, and six hours for a unit of cloth.

One may consider that A and B are initially
isolated from one another. Country A has chosen
point E (80 cloth, 140 wine) as its production-
consumption point. Country B has chosen point
H (55 cloth, 135 wine). The opportunity of free
trade between the two countries is now opened
up. If both countries want to attain the higher
levels of production and consumption available
to them through specializing on and trading of
the product for which they have a comparative
advantage, Country A will shift its entire labour
force to cloth production, and Country B will
shift its entire labour force to wine production. A
possible barter rate (setting aside the detail of
how this would be worked out) might be one
cloth for two and one-half wine. Country A might
then choose to export 60 units of its hourly cloth
output of 150, keeping the other 90 for domestic
consumption. In exchange for this 60 cloth (at the
1-for-2 1/2 exchange rate) it would receive 150
wine. A's real income position is thus improved
in comparison with pretrade point E: cloth for
domestic consumption has risen from 80 to 90,
and wine consumption has risen from 140 to 150.
Country B enjoys a similar gain. In comparison
with pre-trade point H, its cloth consumption has
risen from 55 to 60, and wine consumption has
risen from 135 to 150.
The incentive to export and to import can
be explained in price terms. In country A (before
international trade), the price of cloth ought to be
twice that of wine, since a unit of cloth requires
twice as much labour effort. If this price ratio is
not satisfied, one of the two commodities will be
overpriced and the other underpriced. Labour will
then move out of the underpriced occupation and
into the other, until the resulting shortage of the
underpriced commodity drives up its price. In
country B (again, before trade), a cloth unit
should cost three times as much as a wine unit,
since a unit of cloth requires three times as much
labour effort.
The absolute levels of price do not matter. All
that is necessary is that in each country the ratio
of the two prices should match the labour-cost
ratio.
As soon as the opportunity of exchange
between the two countries is opened up, the
difference between the wine-cloth price ratio in
country A (namely, 5:10, or 1:2) and that in
country B (which is 1:3) provides the opportunity
of a trading profit. Cloth will begin to move from
A to B, and wine from B to A. A trader in A,
starting with a capital of $10 for example, would
buy a unit of cloth, sell it in B for 3, buy 3 units
of B's wine with the proceeds, and sell this in A
for $15. (This example assumes, for simplicity,
that costs of transporting goods are negligible or
zero. The introduction of transport costs
complicates the analysis somewhat, but it does
not change the conclusions, unless these costs are
so high as to make trade impossible.)
So long as the ratio of prices in country A
differs from that in country B, the flow of goods
between the two countries will steadily increase
as traders become increasingly aware of the profit
to be obtained by moving goods between the two
countries. Prices, however, will be affected by
these changing flows of goods. The wine price in
country A, for example, can be expected to fall as
larger and larger supplies of imported wine
become available. Thus A's wine-cloth price ratio
of 1:2 will fall. For comparable reasons, B's price
ratio of 1:3 will rise. When the two ratios meet, at
some intermediate level (in the example earlier,
at 1:2 1/2), the flow of goods will stabilize.
Amplification of the theory

At a later stage in the history of
comparative-advantage theory, the English
philosopher and political economist John Stuart
Mill showed that the determination of the exact
after-trade price ratio was a supply-and-demand
problem. At each possible intermediate ratio
(within the range of 1:2 and 1:3), country A
would want to import a particular quantity of
wine and export a particular quantity of cloth. At
that same possible ratio, country B would wish to
import and export particular amounts of cloth and
of wine. For any intermediate ratio taken at
random, however, A's export-import quantities
probably will not match those of B. Ordinarily,
there will be just one intermediate ratio at which
the quantities correspond; that is the final trading
ratio at which quantities exchanged will stabilize.
(Once they have stabilized, there is no longer any
profit in exchanging goods. Even with such
profits eliminated, however, there is no reason
why A producers should want to stop selling part
of their cloth in B, since the return there is as
good as that obtained from domestic sales. Any
falloff in the amounts exported and imported
would reintroduce profit opportunities.)
In the elementary labour-cost example used
above, there will be complete specialization:
country A's entire labour force will move to cloth
production and country B's to wine production.
More elaborate comparative-advantage models
recognize production costs other than labour (that
is, the costs of land and of capital). In such
models, part of country A's wine industry may
survive and compete effectively against imports,
as may also part of B's cloth industry. The
models can be expanded in other ways: to take
account of more than two countries, or more than
two commodities, and of transport costs. The
essential conclusions, however, come from the
elementary model used above, so that this model,
despite its simplicity, still provides a workable
outline of the theory. (It should be noted that
even the most elaborate comparative-advantage
models continue to rely on certain simplifying
assumptions without which the basic conclusions
do not necessarily hold. These assumptions are
discussed below.)
As noted earlier, the effect of this analysis
is to correct any false first impression that low-
productivity countries are at a hopeless
disadvantage in trading with high-productivity
ones. The impression is false, that is, if one
assumes, as comparative advantage theory does,
that international trade is an exchange of goods
between countries. It is pointless for country A to
sell goods to country B, whatever its labour-cost
advantages, if there is nothing that it can
profitably take back in exchange for its sales.
With one exception, there will always be at least
one commodity that a low-productivity country
such as B can successfully export. Country B
must of course pay a price for its low
productivity, as compared with A; but that price
is a lower per capita domestic income and not a
disadvantage in international trading. For trading
purposes, absolute productivity levels are
unimportant; country B will always find one or
more commodities in which it enjoys a
comparative advantage; that is, a commodity in
the production of which its absolute disadvantage
is least. The one exception is that case in which
productivity ratios, and consequently pre-trade
price ratios, happen to match one another in two
countries. Such would have been the case had
country B required four labour hours (instead of
six) to produce a unit of cloth. In this particular
circumstance, there would be no incentive for
either country to engage in trade, and no gain
from trading. In a two-commodity example such
as that employed, it might not be unusual to find
matching productivity and price ratios. But as
soon as one moves on to cases of three and more
commodities, the statistical probability of
encountering precisely equal ratios becomes very
small indeed.
The major purpose of the theory of
comparative advantage is to illustrate the gains
from international trade. Each country can gain
by specializing in those occupations in which it is
relatively efficient; it should export part of that
production and take in exchange those goods in
whose production it is, for whatever reason, at a
comparative disadvantage. The theory of
comparative advantage thus provides a strong
argument for free trade--and indeed for a laissez-
faire attitude with respect to trade. The
supporting argument is simple: specialization and
free exchange among nations yield higher real
income for the participants.
The fact that a country will enjoy higher
real income as a consequence of the opening up
of trade does not mean, of course, that every
family or individual within the country must
share in that benefit. Producer groups affected by
import competition obviously will suffer, to at
least some degree. Comparative-advantage
theorists concede that free trade would affect the
relative income position of such groups, and
perhaps even their absolute income level. But
they insist that the special interest of these groups
clashes with the total national interest, and the
most that they are usually willing to concede is
the possible need for temporary protection
against import competition, in order that the
persons affected may have sufficient time to
move to another occupation. Nations do, of
course, maintain tariffs and other barriers to
imports.
SOURCES OF COMPARATIVE
ADVANTAGE

As already noted, British classical economists
simply accepted the fact that productivity
differences exist between countries; they made
no concerted attempt to explain which
commodities a country would export or import.
During the 20th century, international economists
have offered a number of theories in an effort to
explain why countries have differences in
productivity, the factor that determines
comparative advantage and the pattern of
international trade.
Natural resources
First, countries can have an advantage
because they are richly endowed with a particular
natural resource. For example, countries with
plentiful oil resources can generally produce oil
inexpensively. Thus, Saudi Arabia produces oil
very cheaply, giving it a comparative advantage
in oil, and it exports oil in order to finance its
purchases of imports. Similarly, countries with
large forests generally are the major exporters of
wood, paper, and paper products. The supply
available for export also depends on domestic
demand. Canada, for example, has large
quantities of lumber available for export to the
United States, not only because of its large areas
of forest but also because its small population
consumes little of the supply, leaving much of the
lumber available for export. Climate is another
natural resource that provides an export
advantage. Thus, for example, bananas are
exported by Central American countries, not
Iceland or Finland.
Factor endowments: the Heckscher-Ohlin
theory

The proposition that countries with plentiful
natural resources generally have a comparative
advantage in products using those resources is
obvious and straightforward. A related, but much
more subtle, explanation was put forward by two
Swedish economists, Eli Heckscher and Bertil
Ohlin. Ohlin's work was built upon that of
Heckscher. In recognition of his ideas as
described in his path-breaking book,
Interregional and International Trade (1933),
Ohlin shared the Nobel Prize for Economics in
1977.
The Heckscher-Ohlin theory focuses on the
two most important factors of production, labour
and capital. Some countries are relatively well-
endowed with capital; the typical worker has
plenty of machinery and equipment at his
disposal. In such countries, wage rates generally
are high. Products requiring much labour--such
as textiles, sporting goods, and simple consumer
electronics--tend as a result to be more expensive
than in countries with plentiful labour and low
wage rates. On the other hand, goods requiring
much capital and only a little labour (automobiles
and chemicals, for example) tend to be relatively
inexpensive in countries with plentiful and cheap
capital. Thus, countries with abundant capital
should generally be able to produce capital-
intensive goods relatively inexpensively,
exporting them in order to pay for imports of
labour-intensive goods.
In the Heckscher-Ohlin theory it is not the
absolute amount of capital that is important;
rather, it is the amount of capital per worker. A
small country like Luxembourg has much less
capital in total than India, but Luxembourg has
more capital per worker. Accordingly, the
Heckscher-Ohlin theory predicts that
Luxembourg will export capital-intensive
products to India and import labour-intensive
products in return. Despite its plausibility the
Heckscher-Ohlin theory is frequently at variance
with the actual patterns of international trade. As
an explanation of what countries actually export
and import, it is much less accurate than the more
obvious and straightforward natural resource
theory.
One early study of the Heckscher-Ohlin
theory was carried out by Wassily Leontief, a
Russian-born U.S. economist. Leontief observed
that the United States was relatively well-
endowed with capital. According to the theory,
therefore, the United States should export capital-
intensive goods and import labour-intensive ones.
He found that the opposite was in fact the case:
U.S. exports are generally more labour intensive
than the type of products that the United States
imports. Because his findings were the opposite
of those predicted by the theory, they are known
as the Leontief Paradox.
Economies of large-scale production.

Even if countries have quite similar
climates and factor endowments, they may still
find it advantageous to trade. Indeed,
economically similar countries often carry on a
large and thriving trade. The prosperous
industrialized countries have become one
another's best customers. A main reason for this
situation lies in what is called the economies of
large-scale production.
For many products, there are advantages
in producing on a large scale; costs become lower
as more is produced. Thus, for example,
automobiles can be made more cheaply in a
factory producing 100,000 units than in a small
factory producing only 1,000 units. This means
that countries have an incentive to specialize in
order to reduce costs. To sell a large volume of
output, they may have to look to export markets.
The smaller the country, and the more limited
its domestic market, the more incentive it has to
look to international trade as a way of gaining the
advantages of large-scale production. Thus,
Luxembourg or Belgium has much more to gain
relatively than does the United States. Indeed, the
advantages of large-scale production have been
one of the major sources of gain from the
establishment of the European Economic
Community (EEC), which was formed for the
purpose of providing free trade between most
western European countries.
Even a large country such as the United
States, however, can gain in some cases by
exporting in order to lengthen production lines.
For example, the Boeing Company has been
able to produce airplanes more cheaply because it
is able to sell large numbers of aircraft to other
countries. The importing countries also gain
because they can buy aircraft abroad more
cheaply than they could produce them at home.
Technology
Technological development can also
provide a distinctive trade advantage. The
relatively advanced countries--particularly the
United States, Japan, and those of western
Europe--are the principal exporters of high-
technology products such as computers and
precision machinery.
One important aspect of technology is
that it can change rapidly. Such rapid changes
present several challenges. For the countries that
are not in the front rank, it raises the question of
whether they should import high-technology
products or attempt to enter the circle of the most
advanced nations. For the countries that have
held the technological lead in the past, there is
always the possibility that they will be
successfully overtaken by newcomers. This
occurred in the second half of the 20th century
when Japan advanced technologically in its
automobile production to the point where it could
challenge the automobile leadership of North
America and Europe. Japan quickly became the
world's foremost producer of automobiles.
The product cycle

The spread of technology across national
boundaries means that comparative advantage
can change. The most technologically advanced
countries generally have the advantage in making
new products, but as time passes other countries
may gain the advantage. For example, many
television sets were produced in the United States
during the 1950s. As time passed, however, and
technological change in the television industry
became less rapid, there was less advantage in
producing sets in the United States. Producers of
television sets had an incentive to look to other
locations, with lower wage rates. In time, the
manufacturers established overseas operations in
Taiwan, Hong Kong, and elsewhere.
Concurrently, the United States turned to new
activities, such as the manufacture of large
mainframe computers and the development of
computer software.


Questions:
1. How would you define te therm
"mercantilism"?
2. Who was John Stuart Mill?
3. What is the major purpose of the theory
of comparative advantage?

Fill in:

The __________-Ohlin theory focuses on the two
most important factors of __________, labour and
capital. Some __________are relatively well-
endowed with capital; the typical worker has plenty of
__________and equipment at his disposal. In such
countries, wage rates generally are __________.
__________requiring much labour--such as textiles,
sporting goods, and simple __________electronics--
tend as a result to be more expensive than in countries
with plentiful labour and low __________rates.
Test Your English

I. Match the following sentences with the
words or phrases (a-k).
1.The holder of these has lent the company
money but has no voting rights.
2 A group of six accountants have decided to
form an association to carry on business in
common and make a profit.
3.The investors give these people the power to
run the company .
4.This company holds more than 50% of the
voting shares in another company.
5.Members of the public can only invest in this
company if they are invited to do so.
6.Investments in many companies can be made
by buying shares on this market.
7.The public at large can be shareholder in this
company.
8.The golf club was set up with the intention of
not making a profit.
9.Fifty one per cent of the voting shares of this
company are held by another company.
10.This is the meeting which is held once a year
for the shareholders.

a.subsidiary
b.group
c.non-profit-making
d.stock exchange
e.partnership
f.directors
g.private limited
h.debentures
i.public limited
j.holding company
k.annual general meeting

II. Choose the correct answer in each of the
following:
1.Funds coming into a firm are known as
................of funds.
a.springs
b.sources
c.origination
d.income

2.The ways these funds are used are known as the
....................of funds.
a.application
b.delegation
c.disposal
d.consumption.

3.................funds include money in our hands
and in the bank.
a.working
b.current
c.profit
d.cash

4.When you take away current liabilities from
current assets you have the amount of
.............funds.
a.liability
b.working capital
c.asset
d.flow

5.Financial statements about cash funds are
usually known as.....................statements.
a.cash flow
b.cash resource
c.cash outflow
d.cash loss

6.An item which doesnt involve flow of funds is
.........................
a.sales of fixed assets
b.drawings
c.depreciation
d.loan repayment

7.An item which involves flow of funds
is...............
a.provision for bad debts
b.book loss on sale of fixed assets
c.sale of fixed asset
d.book profit on sale of fixed asset.

DEALING WITH A CUSTOMER

Abstract: Customers ask for certain
rules to take into consideration if we want to
deal with them correctly and be in good terms.
It is a way to be successful in business and to
gain their respect.
Key words: to deal, to threaten,
complain, demanding, supplier, information.

When dealing with a customer you may
encounter some situations:
You have an angry

customer because you
messed up
The first step in dealing with any angry
customer, whatever the reason, is to listen while they
get their anger out of their system. Sympathize with
the problem with phrases such as, 'How frustrating for
you,' or '1 can see how infuriating that must: be'.
Once they have expressed their feelings, and
realized that you are listening and sympathetic, they
will calm down. At this point it is wise, as well as
honest, to hold your hands up and admit your mistake
by saying something like. Im terribly sorry. 1 should
have put the order through manually and I clean
forgot. I do apologize, especially after it's caused you
so much trouble'. This will take the wind out of their
sails, not least because so few people actually admit lo
their mistakes.
So long as you offer to put things right: in
any reasonable way that suits the customer, they
are likely to end up feeling very satisfied. Not
only have you resolved the problem, you've also
been honest with them. It should reassure t hem
that you're a good organization to do business
with: everyone makes the occasional mistake, and
at least you admit to it and put it right magnan-
imously.
Some people will advise you never to
admit blame when dealing with customers in
case they sue you. It may be wise to take legal
advice if your mistake has cost them thousands,
but in most cases they're not going to sue. If
you've cost them j ust a few pounds, what's the
problem? You ought to pay up, so there should
be no question of suing. From a legal point of
view, refusi ng to admit blame may sometimes
be wise. From an ethical and customer
relations standpoint, it is always better to admit
your mistakes.
You have an angry customer because one
of your team messed up.
Handl e t hi s exactly as you would if it
was you that had messed up. You are responsible
for your team, and you should carry the can. The
customer doesn' t need to know which
indivi dual in your team messed up; it ' s enough
to know that it' s your team. Don't ever t ry to pass
the buck when speaking to a customer,
tempting though it may seem to say, ' I' m afraid
a j uni or member of my department made a
mistake'.
You wi l l obviously need to t alk to the
team member in question privately. However,
you need to separate the mistake from the
customer's reaction to i t . If t he customer
overreacted wildl y to a minor error of
judgement or an understandable mistake, don't
make a big deal of it wi t h your team member
j ust because the customer made a big deal of it
with you. If you're angry and upset by your
exchange wi t h the customer, wait unt i l you've
calmed down before tackling the person who
made the mistake.
You can't deliver on a promise to a
customer
The important thing is to limit the
damage, and there are two key ways to do this:
1. The most important thing is to give
your customer as much notice as you possibly
can. The later you tell them, the deeper the hole
you land them in. Plenty of warning gives them
time to find a contingency without it becoming a
major issue. If you're not sure whether you can
deliver but it's looking increasingly dodgy, you'll
need to explain the situation before you know for
certain whether you'll have to let them down.
Then they can choose whether to take the risk or
whether to find an alternative.
2. When you tell them, apologize
profusely and let them know that you recognize
how inconvenient it is for them. Then offer them
whatever you can to make up for it. This might
mean telling them you can deliver part of what
they want, or they can have everything they want
but later than they hoped or to a lower standard.
Or you might say, 'I can't do this, but I can find
you someone who can'.
A major customer threatens to go
elsewhere unless you make concessions you can't
afford
They say t hat they' ll go to your
manager/the top of your organization/the press.
The answer is in t he question here. If you
really can' t afford the concessions, you can't
afford the customer and you're better off letting
them go. Before you do, however, make sure
that there really aren't any other concessions chat
would suit you both. If you can't drop your
prices low enough, maybe they can pay in
installments or on other very good terms. If you
can't deliver soon enough, perhaps you could
deliver part of the order.
If there is no meeting ground, make sure
you part on friendl y terms. Don't tell them
they'll regret changing supplier. That way, they
may well come back to you. If they were
bl uffing to get you to make concessions, or if
their new supplier lets them down, you want
them to feel they can come back to you easily.
A disgruntled customer threatens to
report you
They say that they' ll go to your
manager/top of your organization/the press. Let
them. Presumably you've done nothing wrong, so
you have nothing to worry about. Arguing with
them will make it worse, and look as if you're
running scared. If you say to them, ' If you feel
you want to take it further, that' s up to you,' it's
more likely to deter them. After all, they were
threatening in order to get a response from you.
The tactic clearly hasn't worked so they may
well abandon it.
If the customer threatens to go to
someone internally, from your immediate boss to
the MD, forewarn the manager concerned. They
won't be too pleased if they get a call from a
customer and look a fool because they don't have
any of the facts. So brief them fully.
If by any chance you are at fault, you're
still better off 'fessing up. It is better for your boss
to hear it from you first than from an angry
customer.

A customer is wrong
Sometimes a customer accuses you of
doing something that you really haven't done. In
fact, maybe their subsequent problems have
arisen because they failed to give you their full
address, or sign the cheque. So what do you do
when they complain? Is the customer really
always right?
You need to listen to their complaint, and
sympathize with their problem just as yon would
if the complaint were justified. You can still say,
'How frustrating!' or I can see that must have
put you in a difficult position,' without
admitting blame.
Tactfully explain what has caused the
problem, but don't make them feel stupid or they
could get defensive. Avoid words and phrases
such as 'fault' or 'you should have . . Give them
an excuse for their mistake. For example, 'Our
delivery terms are 28 days unless you specify
express delivery. I know how easy it can be to
overlook that sort of thing, especially when
you're in a hurry.'
Let them feel their point is valid, without
accepting blame. Say for example, 'Maybe we
should print our delivery terms on the order form
as well as on the terms and conditions. I'll
suggest that to the department concerned.'
Don't offer refunds or replace items just
to calm a customer down, in case it implies that
you were at fault. This might be an unwise
precedent. However, if you really want to do
something, describe it as a gesture of
appreciation for bringing their problem to your
attention.

You know one of your customers is lying to you
You get them occasionally, customers
who frequently claim, for example, that the
goods arrived faulty or damaged when you know
for a fact that they didn't. Whatever you do, don't
bother arguing. You've got two options:
1. give the customer the benefit of the
doubt
2. stop supplying them and ask them to
go elsewhere.
You've already got a dishonest customer.
If you argue with them, you'll have an angry,
dishonest customer - and that's worse. They
may spread rumours or damaging gossip about
your organization. So don't fall out with them.
The other trap to avoid is changing your
systems in order to try and combat their
dishonesty. You could inconvenience all your
honest customers, and make your own lives
more complicated, just for the sake of a
customer who doesn't deserve that kind of effort.
So if you don't want to put up with it, just drop
the customer.
An important customer demands more of
your time than you can spare
If you have a very t al kat i ve customer
who engages you in long-winded
conversations, you need to find a way to get
the information you need from them and then
terminate the conversation without upsetting
them. You can't keep i nt errupt i ng them
without sounding rude, so you need to
interrupt yourself.
It may sound strange, but it makes sense
really. You need to get a word in, but to do it by
j oining t hei r conversation rather than
deflecting it. Once you're in, then you can
change the subject, like this: 'I quite agree, the
traffic's getting silly on the North Circular these
days. By the way, when do you need these
delivered by?'
There' s anot her ki nd of demanding
customer, too: the one who's on the phone 10
t i mes a day wi t h endless minor queries. You
can' t avoid this customer altogether, and
you' ll offend them if you try. You just need to
get them to be less of a nuisance:
If someone's calling several times a day,
tell them the first time they call t hat you' re
very busy at the moment and you want to wait
unt i l you can give them your full attention.
Ask if you can call back at the end of the day. They
can save all their questions until you ring back,
and you have only one call all day, at a time of
your choosing.
Put your voicemail on or have someone
field your calls. You do have to t al k to this
customer sometimes, however, so don't wind
them up by taking ages to call back. Once they
learn they can trust you to call back the same day
- albeit at the end of the day - they' ll start to feel
happier about leaving messages.
If the customer is on email, ask them to
email you instead of calling. Explain that you
prefer to have everything in writing so you can be
sure you have all the details, and you don't forget
to follow anything up. Now you can deal with the
queries at a time that suits you. You may have to
speak to them occasionally but, again, you can
choose the time.
A good and previously reliable supplier lets you
down badly
In the short term, you need to find another
supplier. The question is whether in the long term
you should change to a new supplier or whether
you should give this one another chance. In the
end it's your decision, but here are some
considerations to lake into account:
-Why did they let you down? Is it
something they should have foreseen and
avoided? Or was it the kind of freak problem that
no one could have anticipated?
- How did they let you down? Did they
give you as much warning as possible that
trouble was brewing? Did they sound suitably
concerned at letting you down? Did they do
anything to try to mitigate the damage?
- Have they ever let you down before?
Have there been other minor incidents, or is this
the first problem in years?
- Why were you using them in the first
place? What is it that makes them better than
other suppliers?
- Could you find another supplier as good
as them in all the essentials -price, quality,
reliability, service and so on? Shop around and
see what else is available.
By the time you've thought through all
these questions, you should be in a position to
decide whether to stick with this supplier or not.
And there's one other thing you can do- monitor
the service and quality you get from whichever
supplier you use as a replacement (assuming you
find another supplier for this order). This should
give you an idea of whether it's worth moving
your contract.

You have a PR crisis on your hands
Everyone loves a drama - except perhaps
the people caught up in it. Inevitably, then,
many crises will attract the attention of the
press. They gather like hyenas around the kill,
each hungry to get first bite at the story. And not
only do you have to deal with the crisis itself
but you also have to cope wi t h the press, who
will be ready at any moment to t urn on you if
you make a wrong move.
The press can be either a blessing or a
curse in a crisis, and the balance can lie in how
you handle them. Of course, sometimes the press
are on your side from the start. If your buildings
have been damaged by severe weather, or a lorry
has careered off the road straight through your
shop window, you have the sympathy of the
media from the outset.
But the press always want someone to
blame, and all too often they will pick on you. If
you're making redundancies, if you've polluted
the river that runs past the factory or if an
accident has been caused by faulty equipment
then they'll be sniffing round for evidence to pin
the blame on you.
So what can you do? The good news is
that there is a wealth of advice, derived from the
experience of thousands of organizations over
many years. There are ways to handle the press
(and other media) that will at least minimize the
damage and, at best, turn their attitude around
to one of support for your case. So below are the
key rules for handling a PR crisis.
Tell the press what's going on right from
the start. The more information you give them,
the less they will need to dig die dirt to get a
decent story. Don't wait until you've solved the
crisis - keep them posted from the moment they
turn tip asking questions.
It's no good keeping the press informed if
you don't also keep your own people posted.
Otherwise disgruntled staff, who are being kept
in the dark, may well decide to pass on to the
press their own outdated or misunderstood
version of the facts.
Honesty can actually be a disarmingly
smart policy. Many years ago, the BBC
accidentally double booked two key political
figures to give one of the prestigious Reith
lectures. One had to be cancelled, of course, and
the press were f ul l of how and why he had been
snubbed. The Director General of the BBC
adopted a simple but ingenious approach when
questioned by the press. He j ust said: ' It was a
cock up, OK?' He was open, honest and wrong-
footed the press completely. We all have cock
tips from t i me to time, and t he press
understand that as well as anyone.
There are three rules to remember to
keep t hi ngs simple. First: the press don't know
your organisat i on or your i ndust r y as well as
you do, and they want to pri nt a clear, si mpl e
st ory (or t hei r readers. So don' t confuse them
with unnecessary det ai l s, jargon or background
information they don't want. Just keep your
message unclutt ered. If they ask for more,
give it to them if you can. But don't volunteer it.
The second rule of keeping your story
simple is to make sure you have only one
spokesperson if you possibly can. Otherwise
there is a danger that they may contradict each
other. One single point of communication
means one single, consistent voice.
And the third rule is: never speculate.
This simply adds to the confusion. Speculation
may be reported as fact - it often is. So if you're
asked to guess at the cause of the chemical leak,
how many redundancies there are likely to be or
when the bui l di ng wi l l be operational again,
politely decline to comment. Or just say, I don't
know'.
So, the three rules of keeping it simple
are:
1.don' t give more information than you
need to
2.have a single, consistent message
delivered by a single spokesperson
3.never speculate.
Then, get your priorities right
You will horrify readers, listeners or
viewers if you start to talk about the fi nancial
cost of this disaster when people have been
killed or injured.

Be aware how things look to other people
Be aware of what the public perception of
your crisis handling will be. It's not enough to be
right - you have to be seen to be right. Suppose a
press story breaks reporting that many
supermarket eggs are infected with salmonella,
and there is a slight risk of serious illness. You
are an egg producer. If you react by insisting
that there is no danger at all, people will just
think, 'They would say that, wouldn't, they?'
There may indeed be no danger - or there
may be. It doesn't matter. What matters is that
people will think you are trying to cover up the
facts for your own ends; that you're prepared to
lie to people about their health rather than lose
profits. So consider how your version of events,
which people will consider potentially very
biased, will look. It is better to say that you are
very concerned about the health scare over eggs -
you have no evidence that there is any risk at all,
but you're taking action to find out the facts as
fast as possible. Support any research - maybe
donate funds to it - and invite inspectors to check
out your operation. Say you would welcome
official guidelines on how your organization
can remove any risk, and generally be seen to be
taking the action the public, wants, not just
paying lip service to it.

Never 'no comment'
What do you t hi nk when you hear an
interviewee say 'no comment', or when a report
says t hat ' the company declined to comment'?
You think they're guilty, don' t you? You
reckon they've got something to hide. That's what
everyone thinks. And it' s what they' ll t hi nk
about you, if you say 'no comment'. So don't. If
there's nothing you can tell them, it's better to
say, Tin afraid I don't have any more
information at the moment'.

Be positive
If you seem worried or down beat in
interviews, people will assume you're in trouble.
If you come across as angry they will take a
dislike to you. People will read a great deal into
your attitude, so make sure it is always friendly
and positive, especially when you're talking to
the broadcast media. If people have suffered, it
doesn't do to look too cheerful about it, of
course. But you can still be open and courteous.
Make sure you show sympathy for any victims
of the disaster, whether or not you accept
responsibility.

Be friendly
The press are only doing their job. If you
want them on your side, you need to accept this
and not hold grudges against them the phone and
the cafeteria and give them a warm room. Treat
them politely and with respect and be as helpful as
you can.
Get your friends on your side
If the press are against you, recruit people
outside the company who will speak on your
behalf. Satisfied customers, trade association
contacts, suppliers, ex-employees . . . anyone who
the press will be interested to talk to and whom
you can rely on to back you up. They will assure
the press that your safety standards are exemplary,
that you're a great company to work for, that you
are known for your reliability or whatever it is
you need said. Outsiders always have more
credibility than insiders.

Go the extra mile
If you've made a mistake, or are believed to
have made a mistake, do everything you can to
put it right. Even if people blame you for the
crisis itself don't give anyone an excuse to
complain about your response to it. Do even more
than you have to give people extra time off,
replace their damaged property without quibble
and better than it was before, pay to clean up the
river and fund a new wildlife reserve along its
banks. Show that you're sorry you messed up, but
you genuinely want to make everything better.
You may remember a few years ago a
cross channel ferry ran aground on a sandbank.
Due to the vagaries of the tide it was a day or so
before they could float it off again. Meantime
everyone was stuck on board. But the ferry
company and the crew leapt into action as soon
as the disaster struck. They kept everyone
informed, refunded the cost of the tickets, gave
away all the free food and drink they could and
generally bent over backwards to make up for
the discomfort and inconvenience.
When the ferry finally docked, the press
were waiting to interview the passengers as they
disembarked. But much to their disappointment ,
they couldn't find a single passenger who had a
bad word to say about the ferry operator. They
all insisted, 'It was just bad luck, and they
looked after us beautifully.
Remember, you don't have to deal with
very many crises , but the press deal with them
for a living. They are bound to be smarter than
you at it, so don't try to fool them - they'll make
you look the fool. Just play it straight, honest
and open.

Questions:
1. Which is the first step in dealing
with any angry customer?
2. What happens when a major
customer threatens to go elsewhere?
3. Do you have many options with
customers who are wrong?
Test Your English

I. Fill in the gaps with the following words
and phrases: balance sheet, business,
company, current assets, current
assets, fixed assets, fixed assets,
intangible assets, investments, tangible
(Use a dictionary!)
The assets of a European company are usually
divided into two major categories:
(1)_________________ and current assets. The
fixed assets category includes intangible assets,
(2)_________________ assets, and financial
assets. The (3)_________________ category
includes stocks, debtors, investments, and cash at
bank and in hand. In the United States, the assets
of a (4)_________________ are usually divided
into five categories: current assets,
(5)_________________, property, plant, and
equipment; (6)_________________, and other
assets. These categories are listed on the
(7)_________________ in decreasing order of
their presumed liquidity. (8)_________________
are those assets of a company that are reasonably
expected to be realized in cash, sold or consumed
during one year or during the normal operating
cycle of the (9)_________________.
(10)_________________ are long-term assets
acquired for use in business operations. Fixed
Assets accounts are also known as Capital
Assets, Long-Term Assets, Long-Lived Assets,
or Plant and Equipment.

II. Write a short dialogue between a bank
manager and a customer. (20 lines)




Negotiations

Abstract: Negotiation in business is no
doubt about facts, costs, profits, logical decision
making but also about people, their emotions(joy,
surprise, fear, doubt, anger, sorrow) , goals and
the kind of human beings they are. An
understanding of peoples motivation and how
their personalities can affect their behaviour can
be vital in discovering how you can do business
with them better and better.
Key words: parties, power, manager,
understand, to agree, advice.

Negotiation is not a science nor is it a
branch of technology. It is a life skill. We start to
negotiate when we are very young and as we
grow older we build up patterns of behaviour that
reflect what we feel works for us. And this will
be based partly upon the kind of personality we
may have inherited and partly upon the kind of
personality we have lived and grown up.
To negotiate effectively one must
communicate as such. The message has to be
conveyed, received, understood, and accepted in
order to entail the right actions or responses. The
process of transmission is very important not
all negotiations are conducted face to face but
there are other choices too: letters, the fax, the
electronic mail, the phone. Still there might be
some problems such as: they may get missed or
misunderstood.
To many personnel managers, negotiation
implies collective bargaining. To a sales
executive, it wi l l be thought of in terms of
making a commercial deal. Quantity surveyors,
purchasing managers and lawyers all have their
own specialist interpretations of what, in essence,
is a process common to all managerial work. In
reality, all managers negotiate, if not with
outside parties then with each other.
The procedures and language of formal
negotiation vary with the type of negotiation
involved. A set-piece pay bargaining session has
its own system and jargon that differ from those
of a meeting of solicitors to settle a claim for
libel damages. Yet the underlying principles
and much of the psychology of the process are the
same for all forms of negotiation.
It is also easy for managers to overlook
the fact that much of their informal daily
activity is, in effect, negotiation. All managers
spend a large proportion of their time trying to
influence and persuade other managers over whom
they have no executive authority. Consider two
examples:
A personnel manager attempts to 'sell' the
need for a more systematic form of employee
consultation to a reluctant office manager. The
company has a general policy of support for
employee involvement practices, but has not laid
down any specific system or procedure. Neither
the extent to which the personnel manager can
use the general policy to require the office
manager's cooperation, nor the right of the office
manager to reject the personnel manager's
suggestions is clearly defined. The outcome will be
influenced by their possibly differing perceptions
of the formal position, and by the powers of
argument or persuasion of the personnel manager.
A sales executive tries to persuade the
production manager to change a manufacturing
schedule to fit in a small order for a special
customer. The production manager has full
authority to decide production schedules against a
weekly output plan set by top management.
Officially, the sales manager should make a
request through the sales director for an urgent
variation to this plan but because the order is
only a small one, he approaches the production
manager informally and must, therefore, rely on
persuasion.
Negotiating skills are, therefore, a very
important element in the effective manager's
portfolio of personal competencies.
Recognizing when negotiation is
occurring is the first step towards acquiring the
necessary skills, and this is aided by an
understanding of the basic principles involved.
Negotiation is a process, not a single skill. A
range of skills are involved in handling this
process effectively, but to identify the skills
relevant to any negotiating episode, it is important to
recognize which elements or principles of
negotiation are involved. There are seven
principles common to all forms of negotiation:
Negotiation involves two or more parties
who need or think they need each other's
involvement in achieving some desired
outcome. There must be some common interest,
either in the subject matter of the negotiation or in
the negotiating context that puts or keeps the
parties in contact.
Although sharing a degree of interest, the
parties start with different opinions or objectives,
and these differences initially prevent the
achievement of an outcome.
At least initially, the parties consider that
negotiation is a more satisfactory way of trying to
resolve their differences than alternatives such as
coercion or arbitration.
Each party considers that there is some
possibility of persuading the other to modify their
original position. It is not essential - though it is
usually highly desirable for each party to be
willing to compromise. But negotiation can begin
when parties have an initial intention of
maintaining their opening positions, but each has
some hope of persuading the other to change.
* Similarly even when their ideal outcomes
prove unattainable, both parties retain hope of an
acceptable final agreement.
* Each party has some influence or power
- real or assumed -over the other's ability to act. If
one party is entirely powerless, there may he no
point in the other party committing itself to a
negotiating process. The matter can be settled
unilaterally by the party with the untrammelled
power to act. This power or influence may, however,
be indirect and bear on issues other than those that
are the direct subject of negotiation.
* The negotiating process itself is one of
interaction between people in most cases by
direct, verbal interchange. Even when the
negotiation is being conducted through correspon-
dence, there is an essential underlying human
element. The progress of all types of negotiation
is strongly influenced by emotion and attitudes,
not just by the facts or logic of each party's
arguments.
Negotiation is a process of interaction by
which two or more parties who consider they need
to be jointly involved in an outcome, but who
initially have different objectives, seek by the use
of argument and persuasion to resolve their
differences in order to achieve a mutually
acceptable solution.
It will probably be readily accepted that this
definition is relevant to formal negotiations such as
pay bargaining or the settlement of a legal claim for
damages. Trade unions and employers or the
solicitors representing two parties to litigation
obviously accept that they need jointly to evolve a
mutually satisfactory outcome, starting from
differing positions. Each party knows that the other
has some power to influence the outcome. A trade
union might apply the sanction of industrial action:
an employer might reduce the labour force: the
claimant's solicitors might stop negotiating and
take the case to court: the respondent has some
defence if this occurs.
In the second of these examples, the sales
executive has no direct power to require the
production manager to alter production schedules:
the production manager can just say no -- so
where does negotiation come in? A willingness at
least to consider the request and thereby become
involved in a discussion about a possible jointly
satisfactory outcome - will stem from several as-
pects of common interest, or from recognition of
more subtle forms of power.
The sales executive wants the production
schedules altered, the production manager does
not, but both managers, it is to be hoped, share an
interest in the success of the business. To
disappoint an important customer may be of more
immediate concern to the sales executive than to
the production manager, but a good production
manager will pay heed to the importance of good
customer service. Similarly, the sales executive
will recognize the costs and perhaps delays to
other orders that a change in the production
schedule might give rise to. So a common interest
in the good of the business enables both to see
something in the other's point of view, and thus
encourages a dialogue, rather than the simple
exercise of formal authority.
It may be that the sales executive (or the
customer on whose behalf the request is being
made) is known by the production manager to be
highly regarded by the managing director. It might
thus be unwise, in terms of company politics, for
the production manager to run the risk of being
considered unhelpful.
Both managers also know that they have
to continue to work together. Without anything
being said, both will probably be influenced by
knowing that this long-term working relationship
could be adversely affected by mishandling the
particular incident. The production manager
may have the right to say no in other words, not
to negotiate but will wonder whether this would
cause avoidable friction. There may also be the
thought that by agreeing some concession, an
obligation may be created that might be
capitalized on at some future date.

In the other example, considerations of a
similar kind might also lead to the office manager's
being willing to discuss the personnel manager's
advice. Both have an interest in the smooth running
of the company and in compliance with the
company policy: the personnel manager may be
known to have top management backing: the
managers have to go on working together, and
therefore the office manager wi l l have to consider
the implications of rejecting the personnel
manager's advice if employee relations are then seen
to deteriorate.

Questions:
1. When do we negotiate?
2. How should the message be?
3. What does negotiation imply?
4. Which are the principles common to
all forms of negotiation?
5. Why is negotiation a process of
interaction?

Fill in:

The sales _____________ wants the
production schedules altered, the production manager
does not, but both _____________, it is to be hoped,
share an interest in the success of the business. To
_____________ an important _____________ may be
of more immediate concern to the sales executive than
to the production _____________, but a good pro-
duction manager will pay heed to the
_____________ of good customer _____________.
Test Your English

I. Have you ever been to a foreign country
before? If so, please give brief details. If
your answer is no, country would you
like to visit and why? (150 words!)

II. Complete the gaps with suitable words:

1. I havent spoken English ___________________
ages.
2. I couldnt understand what he was talking
__________.
3. Where does she come
_______________________?
4. My friends _______________________ me it
was a good film last night.
5. I always _____________________ the same
mistakes when I speak fast.
6. He cant do that _________________. He needs
assistance.
7. The next train should arrive
_______________________ a few minutes.
8. I met her many years
_______________________.
9. The word for "two weeks" is ............................ .
10. Im looking ___________________ to my high-
impact business English training.
11. The merger of the two companies
________________ many changes.
MEETINGS

Abstract: a meeting is a gathering of a
group of people for a controlled discussion
with a specific purpose. People call a meeting
when decisions require judging rather than
calculation or expertise, when pooling ideas
improves the chances of good decisions, to
discuss multi-faced problems requiring
different skills or specialists.

Key words: discussions, to chair, to
challenge, commitment, proposal

Meetings have to be an efficient tool to
assist us in getting decisions, information and
action. We discuss, decide, decree, demolish.
Sometimes they can take over our life. Some are
efficient, others are not and for some of us they
have even become a way of life. The objective of
a meeting should never be to have a meeting.
They are a means to an end, never an end.
If handled well, meetings can be
invaluable tools for getting things agreed or
discussed. Enjoyable meetings that are
productive and help to get the job done are an
ideal that becomes possible with a little effort. An
unsuccessful meeting may do more harm than
one which never takes place. So, the success is
judged by the actions that result from it. And this
is linked to running the meeting as the
responsibility of the whole group not only the
chairman.

There are many reasons to call a meeting:
briefing people
exchanging and evaluate information
negotiating a deal
making decisions
taking things through
solving a conflict
establishing a plan

Sometimes meetings fail because of:
interruptions such as noisy rooms, mobile
phones, messages, people arriving late.
lack of focus: irrelevant discussions
objective not achieved: decisions are not
taken, people say they need more time.
politics motives are being brought in:
confronting discussions
poor preparation: research has not been
done properly.
poor chairing
poor environment: people crammed into a
room, tables covered with tea and coffee cups
and room for the papers.
poor timing: people arriving late,
meetings starting and ending late.
right people absent: people with necessary
input or information are not invited or not
available.
unnecessary meetings: you need a quick
decision
wrong people present: they can ruin a
meeting.

What is important to know in a meeting:
to clarify the purpose of the
meeting
to have meetings only if they are
necessary
to invite people who need to give
approval, have the required expertise or
information, have the creativity or intelligence to
help the group generate ideas, will carry out
decisions made, will support your issue, will be
directly affected by the outcome.
to send out a background
information
to create an agenda in order to
give the start time of the meeting and location,
list participants expected to attend, list issues,
give the order in which they will be dealt with.
to anticipate and prevent
problems: problem people, hot topics, alliances
and politics, support.
the agenda can do half of your
work before the meeting even starts: assessing
items, standard items, have an order for the items,
time each item, write the agenda.
to chair the meeting carefully and
well balanced: bring in quiet people, be open
about input, stimulate a debate or discussion,
listen actively, control discussions, gain
agreement and approval by bringing discussions
to an end, by letting people know it is time to
make decisions or to agree, summarize different
viewpoints, discourage interruptions, ask for a
decision or consensus, make sure the quiet people
speak up, take a vote if necessary.
to satisfy the participants as well
as the agenda.
to consider that a compromise
could achieve both completion of business as
well as satisfying the participants.

to be a good communicator by:
making people feel good and value them and
their opinion, getting them involved in the
meeting, by showing you understand the way
someone feels.
to handle challenges by focusing
on the issue not the behaviour or opinion of
others, bring in others on your side, do not lose
temper, give in and then raise the matter with a
higher authority or at another time.
to announce a finishing time, to
limit the number of items on the agenda to the
time allowed.
to allocate a task owner to each
item who will control the conversation and take
responsibility for any decision.
to summarize within items, at the
end of them and at the end of the meeting.

Types of Meetings

Team Meetings
Consultancy and client meetings
Negotiations
I. Team briefing develops the team
meeting into a management information system.
The objective is to ensure that every employee
knows and understands what they and the others
in the organization do and why. Team leaders and
their teams get together regularly to talk about
issues relevant to them and their work. There are
some benefits to team briefing such as:
it reinforces management
it increases commitment
it prevents misunderstandings
it helps to facilitate change
it improves upward
communication

II. Whenever you meet a client to present
a proposal, however uncommercial the situation,
something is being sold. So, the meeting will fail
if the clients requirements are not defined
adequately beforehand. Part of our job may be to
help the client to clarify what he wants. So
preparation becomes essential, a pre- meeting is
useful to define the problem and agree the
clients requirements as clearly as possible. First
stage thinking has to be used to clarify what the
client wants, before suggesting solutions. The
following guidelines have to be used:
create agreement with the client.
identify the clients need.
present your solution.
explain the proposal in detail
anticipate any objections you
know the client has.
restate the proposal by
summarizing, discussing.
keep discussion separate from
your presentation.

III. Doing deals is a fundamental way to
achieve goals; but it is a means not an end. A
successful negotiation closes with everybody
satisfied, the negotiator is delighted when the
meeting creates genuine agreement. Once you
recognized a meeting as a forum for negotiation
we have established as adversarial situation. As a
result, scoring over the opposition becomes an
important strategy. The negotiation becomes an
exercise in game playing: secrecy, bullying,
hood-winking. So, this tacit agreement entails
stress, wastes time and catastrophe may follow,
new problems may arrive, commitment will
suffer, promises will be broken, reputations will
be bruised.
The responsibility will be to seek
agreement: a specific plan of action to which all
parties can commit themselves.

CONVERSATION: THE HEART OF
MEETINGS

At the heart of any meeting is
conversation. It is by conversing that we express
our thinking and relationships to each other. If we
want to improve our meetings, we must improve
the quality of the conversations that take place in
them.

THE DYNAMICS OF CONVERSATION

Conversation is a verbal dance. The word,
from Latin, has the root meaning of 'to keep
turning with'. Conversation relies for its success
on all participants moving.
Like any dance, conversation has rules
and standard moves. These allow people to move
more harmoniously together, without stepping on
each other's toes. Different kinds of conversation
have different conventions. Some are implicitly
understood; others must be spelled out in detail
and rehearsed.
This sense of a conversation is well
expressed in the word 'dialogue'. The purpose of
dialogue (from the Greek, 'meaning through') is to
construct a new, shared meaning through conver-
sation: a meaning that would not come into being
if the conversation did not happen. We explore
each other's perceptions, offer our own for
examination and transform our thinking in the
light of others'. This, at its very best, is what
conversation can achieve.

Talking and listening

The dynamic of conversation involves two
elements: talking and listening. These two
activities do not happen merely in sequence, but
simultaneously: each participant in a
conversation is both speaker and listener
throughout the conversation.
Most of us are better at talking than at
listening. As managers, we are trained in the
techniques of presenting, explaining and
influencing. Our education mostly stresses the
value of arguing: taking a position, holding it,
defending it, convincing others of its worth and
attacking any argument that threatens it. As a
result, our conversations tend not to dance but to
push and shove.

Adversarial thinking

In an attempt to impose order on our
conversations, we have invented debate (from
the Latin, 'to beat down')- Debate fosters
adversarial thinking: a form of group thinking so
common that, for many of us, it is the only way
any group can think. Instead of enduring a
verbal brawl, we set up a boxing match, in
which ideas - preferably two opposing ideas -
fight it out according to more or less strict rules.
The idea left standing at the end is considered to
be 'true'.
Much is made in management theory of
the virtue of debate. It is said to be not merely
unavoidable in business, but positively desirable:
a recent article in Harvard Business Review calls
it 'creative abrasion'. No less an authority than
Peter Drucker has written: 'the understanding that
underlies the right decision grows out of the clash
and conflict of divergent opinions and out of the
serious consideration of competing alternatives'.
By the rules of debate, if you prove the
opposing idea to be wrong, you have somehow
proved that yours is correct. This is clearly
ridiculous: both arguments may be wrong; both
may be partly right. Yet debate cannot allow us
to consider these possibilities - or any others. A
debate is a conflict of rigid opinions.
Opinions are ideas gone cold. They are
our assumptions about
what might, or should, be true
rather than what is true in specific circumstances.
They may take the form of:
- stories (about what
happened, what may have happened,
why it may have happened);
- explanations (for why
something went wrong, or why we
failed);
justifications (for taking action or
not);
wrong making (I am right, you are
wrong);
gossip (to make us feel better at
the expense of others);
generalizations (to save us the
trouble of thinking).
We are so used to voicing and listening to
opinions that we can easily mistake them for the
truth. Whenever you hear the word 'fact' in a
meeting, you can be almost certain that
somebody is voicing an opinion.
The overwhelming limitation of
adversarial thinking is that it is destructive. The
'clash and conflict of divergent opinions' actually
prevents people from exploring or developing
ideas. They are too busy defending themselves,
too frightened to venture from their corners, too
battle-fatigued.
It is unusual for any meeting to avoid
adversarial thinking. It
usually appears in one of four forms.

Critical thinking

For most of us, to think about something
is automatically to look for something wrong with
it. Take note next time you ask anybody for their
response to an issue: invariably their first
thoughts will be critical.
The rationale behind critical thinking is
presumably that, by looking for the weaknesses in
an idea, we can strengthen it. But we rarely receive
criticism in this way; instead, we try to defend our
idea from the criticism or attack the criticism
itself, in an effort to discredit it.

Ego thinking

In adversarial thinking, we become
identified with our ideas. Criticism of an idea
quickly becomes an attack on the person holding
it. Debate is used as a pretext for scoring points
against others. Reason gets infected with
emotion.
Meetings often devote enormous amounts
of energy to preventing emotion from
overwhelming debate, but the dynamic of debate
makes emotional conflict inevitable.

Rigid thinking

All thinking starts from propositions
about reality. Adversarial thinking merely pits
these propositions against each other. It limits
itself to their terms and their consequences: any
thinking that questions the thinking behind a
proposition, or strays beyond its boundaries,
can be dismissed as 'irrelevant' (or 'deviant').
Indeed, the adversarial mode actually serves to
entrench propositions rather than adapt or
modify them. Rigid thinking is usually the result
of:
conforming to authority ('if
senior management see it this
way, it must be right');
the influence of custom ('our
profession has thought like
this for the last two hundred
years');
habit ('this is the way we think
around here');
wilful ignorance ('thinking like
this saves us the bother of
dealing with inconvenient detail
or finding out more').

Political thinking

When ideas become identified with
individuals, people realize that achieving action
is a matter of aligning themselves with ideas,
and with those promoting them. As rigid
thinking limits the growth of ideas,
propositions can only be attacked or defended.
To attack an idea is to attack its sponsor; to
support it is to create an alliance. We begin to use
conversational gambits, ploys, manoeuvres and
defence mechanisms, not to develop the
conversation but to play politics: creating
'power bases' and undermining 'opponents',
bureaucratic conniving, behind-the-scenes
manipulation and rumour-mongering. We
accord adversarial thinking enormous prestige.
Managers
who can defend their ideas and withstand
the onslaught of their peers - or, better still, their
superiors - gain status and may be promoted on
the basis of their 'strong character'. They
become 'heroes' and the stuff of myth.
Adversarial thinking is self-perpetuating.
Like other kinds of conflict, it is cyclical and
can escalate easily. Being attacked for our ideas
causes pain; we respond in kind and help to
prolong the conflict. We may engage in 'pre-
emptive strikes', attacking before being
attacked. Adversarial thinking expresses our
lack of security, and the need to protect
ourselves from future threats.
Thus we become locked in a 'cold war'
of argument and counter-argument. Although
we may recognize that our behaviour is
unproductive, we feel we cannot do anything
different. We do not know how to; and we may
be too frightened to
who can defend their ideas and withstand
the onslaught of their peers - or, better still, their
superiors - gain status and may be promoted on
the basis of their 'strong character'. They
become 'heroes' and the stuff of myth.
Adversarial thinking is self-perpetuating.
Like other kinds of conflict, it is cyclical and
can escalate easily. Being attacked for our ideas
causes pain; we respond in kind and help to
prolong the conflict. We may engage in 'pre-
emptive strikes', attacking before being
attacked. Adversarial thinking expresses our
lack of security, and the need to protect
ourselves from future threats.
Thus we become locked in a 'cold war'
of argument and counter-argument. Although
we may recognize that our behaviour is
unproductive, we feel we cannot do anything
different. We do not know how to; and we may
be too frightened to

How, then, can we break out of the vicious
spiral? What can we do to help meetings evolve
beyond the fruitless and exhausting ritual of
adversarial thinking? Perhaps the first step is to
improve our listening.


THE GENTLE ART
OF LISTENING

The quality of any conversation depends
on the quality of the listening. Listening is far
more than simply not speaking. The listener
controls the speaker's behaviour by their own: by
maintaining or breaking eye contact, by their
body position, by nodding or shaking their head,
by taking notes or doodling, and so on. Similarly,
when we speak, we demonstrate the quality of our
listening. If we interrupt, we demonstrate that we
have stopped listening, that we are not interested
in listening any longer. This, in turn, will affect
the other's speaking and listening.
We all know the symptoms of poor
listening. They are so familiar that we even
expect them and develop tactics to cope with
them. They include:
outright condemnation of an idea;
criticizing the speaker's delivery;
only replying to a part of what
somebody has said;
interrupting;
daydreaming;
paying attention to a distraction;
holding another conversation at
the same time;
evading the issue;
using emotional words;
going to sleep.
We are all able, however, to listen
effectively. We listen well when we:
like or admire the speaker;
want to trip them up;
think they have something
interesting to say;
expect to be rewarded or punished
for listening well;
know that we will be asked to
comment;
have an overwhelming need to
listen;
are not distracted;
know or have learnt that effective
listening improves group
behaviour and leads to improved results in the
meeting.
The first step in improving our listening
skills is to become aware of the obstacles. Some
we will have control over; others we may have to
endure.

Talking:

Arguing
Multiple conversations
Asking an irrelevant question
Changing the subject
Wandering off the point
Unfamiliar voice patterns
Ambiguity: double meanings, woolz use
of language, jargon
Lack of detail in speaking
Speaking too long

Behavioral:

Avoiding eye-contact
Looking bored
Sending the wrong signals: head-shaking,
foot-tapping
Yawning
Fidgeting
Clock-watching
Rustling papers
Misinterpreting behaviour
Cross-cultural confusion


Psychological:

Shyness
Aggressiveness
Intimidation
Inappropriate use of authority
Personality clashes
Bias
Favourism
Prejudice: race, gender, class, age,
educational background
Cultural habits

Physical:
Noise
Other people
Other meetings
Sub-meetings
Interruptions from outside
Technical interruptions: phones, bleepers,
computer malfunctions
Poor ventilation
Fierce air-conditioning
Extremes of temperature
Uncomfortable furniture
Sitting too long
Inappropriately shaped table
Disability not accommodated
Conversation is the way we think
together. What we say is what we think. We are
paid to think. Our success depends on our
results; we think when we want results that are
better than they would be without thinking. And
yet most of us are not trained to think. Thinking
is not yet regarded as a key managerial skill. As
a result, we have developed a number of
damaging misconceptions about thinking.
Thinking is not an alternative to doing.
We can use thinking as an excuse not to act;
and we can act without thinking. The reason we
do both so much is that we regard thinking and
action as opposed. They are not. Effective
thinking improves the effectiveness of our
actions; and our actions are a rich source of
good ideas.
Thinking is not intelligence. Thinking
unintelligently may still achieve something.
Intelligence without thinking is useless.
Thinking is not a function of education.
Highly educated people are not necessarily
good thinkers; and many people with little
education can think extremely effectively.
Thinking is not being clever. An
increase of knowledge is not thinking: it is
simply hoarding. Too much information can
seriously hamper our ability to think.
Thinking is not only the operation of
logic. It involves looking, exploring, choosing,
designing, evaluating and having hunches. It
includes considering priorities, objectives,
alternatives, consequences and other people's
opinions.
There is a Japanese proverb: 'None of us
are as smart as all of us.' Yet most groups of
people think far less well than any one of them
individually. Two main reasons suggest
themselves.
1. We confuse conversation about the
task with conversation about process. We
identify thoughts with people. We talk in code.
We use conversation to express loyalties or
alliances, to bid for power, to protect our
position or sense of self-worth. We persist in old
conventions or habits of conversation to feel more
comfortable.
2. We fail to manage the structure of the
conversation. A well-managed conversation will
begin with clear objectives and end with clear
actions. Many conversations have unclear agendas
(or hidden agendas); others are combinations of
several conversations at once. We allow our
conversations to ramble, to get stuck, to be
hijacked or stifled. Because the behavioural or
'political' aspects of conversation are so powerful,
we find it difficult to influence the course of con-
versations productively - particularly in a
meeting, when a group of people are involved.
Tackling these two failings is critically
important if we want to help ourselves and others
to think better in meetings.
Questions:

1. What does the quality of any conversation depend on?
2. What does a listener control?
3. Is thinking an alternative to doing?
4. Does conversation have rules?
5. What is the purpose of the dialogue?

Fill in:

a) _____________ is a verbal dance. The
word, from Latin, has the root meaning of 'to
keep turning with'. Conversation relies for its
_____________ on all participants moving.
Like any dance, _____________ has rules
and standard moves. These allow people to move
more harmoniously together, without
_____________ on each other's toes. Different
kinds of conversation have different
_____________. Some are implicitly understood;
others must be spelled out in _____________ and
rehearsed.

b) Meetings have to be an efficient
_____________ to assist us in getting decisions,
information and action. We discuss, decide,
decree, demolish. Sometimes they can take over
our life. Some are _____________, others are not
and for some of us they have even become a way
of life. The objective of a _____________ should
never be to have a _____________. They are a
means to an end, never an end.
Test Your English

I. Fill in the gaps with the following words:
away, in, in on, on, out, out.
1. We are (1)_____________of ink for the
photocopier. Can you go
(2)_________________and get some?
2. The application has to be
(3)_________________before Friday.
3. I am going to be
(4)_________________for a few days.
4. He will not let me (5)
_________________the secret.
5. He is (6)_________________50
cigarettes a day at the moment.

II. Continue the following in not more than
150 words: I need to improve my
knowledge of English because

MARKETING
AND
MERCHANDISING


Marketing is a process whose principal
function is to promote and facilitate exchange.
Through marketing, individuals and groups
obtain what they need and want by exchanging
products and services with other parties. Such a
process can occur only when there are at least
two parties, each of whom has something to
offer. In addition, exchange cannot occur unless
the parties are able to communicate about and to
deliver what they offer. Marketing is not a
coercive process: all parties must be free to
accept or reject what others are offering. So
defined, marketing is distinguished from other
modes of obtaining desired goods, such as
through self-production, begging, theft, or force.
Marketing is not confined to any particular type
of economy, because goods must be exchanged
and therefore marketed in all economies and
societies except perhaps in the most primitive.
Furthermore, marketing is not a function that is
limited to profit-oriented business; even such
institutions as hospitals, schools, and museums
engage in some forms of marketing. Within the
broad scope of marketing, merchandising is
concerned more specifically with promoting the
sale of goods and services to consumers (i.e.,
retailing) and hence is more characteristic of free-
market economies. Based on these criteria,
marketing can take a variety of forms: it can be a
set of functions, a department within an
organization, a managerial process, a managerial
philosophy, and a social process.
THE EVOLVING DISCIPLINE OF
MARKETING

The marketing discipline had its origins in
the early 20th century as an offspring of
economics. Economic science had neglected the
role of middlemen and the role of functions other
than price in the determination of demand levels
and characteristics. Early marketing economists
examined agricultural and industrial markets and
described them in greater detail than the classical
economists. This examination resulted in the
development of three approaches to the analysis
of marketing activity: the commodity, the
institution, and the function.
Commodity analysis studies the ways in
which a product or product group is brought to
market. A commodity analysis of milk, for
example, traces the ways in which milk is
collected at individual dairy farms, transported to
and processed at local dairy cooperatives, and
shipped to grocers and supermarkets for
consumer purchase. Institutional analysis
describes the types of businesses that play a
prevalent role in marketing, such as wholesale or
retail institutions. For instance, an institutional
analysis of clothing wholesalers examines the
ongoing concerns that wholesalers face in order
to ensure both the correct supply for their
customers and the appropriate inventory and
shipping capabilities. Finally, a functional
analysis examines the general tasks that
marketing performs. For example, any marketing
effort must ensure that the product is transported
from the supplier to the customer. In some
industries, this transportation function may be
handled by a truck, while in others it may be
done by mail, facsimile, television signal, or
airline. All these institutions perform the same
function.
As the study of marketing became more
prevalent throughout the 20th century, large
companies--particularly mass consumer
manufacturers--began to recognize the
importance of market research, better product
design, effective distribution, and sustained
communication with consumers in the success of
their brands. Marketing concepts and techniques
later moved into the industrial-goods sector and
subsequently into the services sector. It soon
became apparent that organizations and
individuals market not only goods and services
but also ideas (social marketing), places (location
marketing), personalities (celebrity marketing),
events (event marketing), and even the
organizations themselves (public relations).
ROLES OF MARKETING
As marketing developed, it took a variety
of forms. It was noted above that marketing can
be viewed as a set of functions in the sense that
certain activities are traditionally associated with
the exchange process. A common but incorrect
view is that selling and advertising are the only
marketing activities. Yet, in addition to
promotion, marketing includes a much broader
set of functions, including product development,
packaging, pricing, distribution, and customer
service.
Many organizations and businesses assign
responsibility for these marketing functions to a
specific group of individuals within the
organization. In this respect, marketing is a
unique and separate entity. Those who make up
the marketing department may include brand and
product managers, marketing researchers, sales
representatives, advertising and promotion
managers, pricing specialists, and customer
service personnel.
As a managerial process, marketing is the
way in which an organization determines its best
opportunities in the marketplace, given its
objectives and resources. The marketing process
is divided into a strategic and a tactical phase.
The strategic phase has three components--
segmentation, targeting, and positioning (STP).
The organization must distinguish among
different groups of customers in the market
(segmentation), choose which group(s) it can
serve effectively (targeting), and communicate
the central benefit it offers to that group
(positioning). The marketing process includes
designing and implementing various tactics,
commonly referred to as the "marketing mix," or
the "4 Ps": product, price, place (or distribution),
and promotion. The marketing mix is followed
by evaluating, controlling, and revising the
marketing process to achieve the organization's
objectives
The managerial philosophy of marketing
puts central emphasis on customer satisfaction as
the means for gaining and keeping loyal
customers. Marketers urge their organizations to
carefully and continually gauge target customers'
expectations and to consistently meet or exceed
these expectations. In order to accomplish this,
everyone in all areas of the organization must
focus on understanding and serving customers; it
will not succeed if all marketing occurs only in
the marketing department. Marketing,
consequently, is far too important to be done
solely by the marketing department. Marketers
also want their organizations to move from
practicing transaction-oriented marketing, which
focuses on individual exchanges, to relationship-
driven marketing, which emphasizes serving the
customer over the long term. Simply getting new
customers and losing old ones will not help the
organization achieve its objectives. Finally,
marketing is a social process that occurs in all
economies, regardless of their political structure
and orientation. It is the process by which a
society organizes and distributes its resources to
meet the material needs of its citizens. However,
marketing activity is more pronounced under
conditions of goods surpluses than goods
shortages. When goods are in short supply,
consumers are usually so desirous of goods that
the exchange process does not require significant
promotion or facilitation. In contrast, when there
are more goods and services than consumers need
or want, companies must work harder to
convince customers to exchange with them.
THE MARKETING PROCESS
The marketing process consists of four
elements: strategic marketing analysis,
marketing-mix planning, marketing
implementation, and marketing control.

STRATEGIC MARKETING ANALYSIS
Market Segments
The aim of marketing in profit-oriented
organizations is to meet needs profitably.
Companies must therefore first define which
needs--and whose needs--they can satisfy. For
example, the personal transportation market
consists of people who put different values on an
automobile's cost, speed, safety, status, and
styling. No single automobile can satisfy all these
needs in a superior fashion; compromises have to
be made. Furthermore, some individuals may
wish to meet their personal transportation needs
with something other than an automobile, such as
a motorcycle, a bicycle, or a bus or other form of
public transportation. Because of such variables,
an automobile company must identify the
different preference groups, or segments, of
customers and decide which group(s) they can
target profitably.

Market Niches
Segments can be divided into even
smaller groups, called subsegments or niches. A
niche is defined as a small target group that has
special requirements. For example, a bank may
specialize in serving the investment needs of not
only senior citizens but also senior citizens with
high incomes and perhaps even those with
particular investment preferences. It is more
likely that larger organizations will serve the
larger market segments (mass marketing) and
ignore niches. As a result, smaller companies
typically emerge that are intimately familiar with
a particular niche and specialize in serving its
needs.
MARKETING TO INDIVIDUALS

A growing number of companies are now
trying to serve "segments of one." They attempt
to adapt their offer and communication to each
individual customer. This is understandable, for
instance, with large industrial companies that
have only a few major customers. For example,
The Boeing Company (United States) designs its
747 planes differently for each major customer,
such as United Airlines, Inc., or American
Airlines, Inc. Serving individual customers is
increasingly possible with the advent of database
marketing, through which individual customer
characteristics and purchase histories are retained
in company information systems. Even mass-
marketing companies, particularly large retailers
and catalog houses, compile comprehensive data
on individual customers and are able to
customize their offerings and communications.

POSITIONING
A key step in marketing strategy, known as
positioning, involves creating and
communicating a message that clearly establishes
the company or brand in relation to competitors.
Thus, Volvo Aktiebolaget (Sweden) has
positioned its automobile as the "safest," and
Daimler-Benz AG (Germany), manufacturer of
Mercedes-Benz vehicles, has positioned its car as
the best "engineered." Some products may be
positioned as "outstanding" in two or more ways.
However, claiming superiority along several
dimensions may hurt a company's credibility
because consumers will not believe that any one
offering can excel in all dimensions.
Furthermore, although the company may
communicate a particular position, customers
may perceive a different image of the company
as a result of their actual experiences with the
company's product or through word of mouth.


Questions
1. How would you define marketing?
2. What is a marketing strategy?
3. What does market niche mean?
4. What are the roles of marketing?

Fill in:

The ____________ discipline had
its origins in the early 20th century as an
offspring of economics. Economic science
had neglected the role of middlemen and the
role of ____________ other than price in the
determination of demand levels and
characteristics. Early marketing
____________ examined agricultural and
____________ markets and described them in
greater detail than the classical
____________. This examination resulted in
the development of three ____________ to
the analysis of marketing activity: the
____________, the institution, and the
function.
Test Your English

I. Select the right answer:
1. I have been requested to... a deposit
a) leave
b)let
c) put
d) do
2. An I.O.U...
a) is a small loan
b) is the same as a cheque
c) is a bill exchange
d) is a promise to pay on the part of the debtor
3. Your payment is ... and your account is now in the
red.
a) overtime
b) overdue
c) overtaxed
d) overcome
4. The bank does not want to lend me any money. I
shall have to go to the...
a) borrower
b) hireling
c) pawnbrokers
d) cash-register
5. Counterfoil is a synonym for...
a) stub
b) ticket
c) coupon
d)draft
6. A bad cheque may be referred to as a ... check
a) red
b) black
c) dud
d) void
7. A bill of exchange is drawn up by...
a) the payer
b) the debtor
c) the creditor
d) the drawee
8. When the acceptor stipulates some special
condition, the acceptance of a bill is said to be...
a) particular
b) qualified
c) specialized
d) peculiar
9. A hire purchase transaction involves payment by...
a) scattering
b) instalments
c) settlements
d) periods
10. The contract provides for the ... to leave 10% of
the loan on deposit.
a) lender
b) depositor
c) borrower
d) creditor

II. Choose the correct words from the following:
bookkeeping, interest, creditor, company, profit,
current, capital, net, shares, debtor, divident,
statement, to complete the definitions.
1.Recording financial transactions is...........
2.A legal organisation,formally registered in one of
three ways and having a life independent of its
members is a ............
3.A person or organisation that owes money is
a................
4.A person or organisation to whom money is owed is
a.....................
5.The assets,including cash, debtors and stocks used
in a companys trading available at the present
moment are its...................assets
6.The equal parts into which the ownership of a
company is divided are its..................
7.The money paid to shareholders out of a companys
profits is the ..................
8.A companys turnover, less its cost of sales,is its
gross......................
9.A companys turnover after the cost of sales,
tax,rent and other liabilities are deducted is
its.................profit.
10.The sum of money paid by a borrower to a lender
for the use of the lenders money is the.............on the
loan.
11.The document send to the debtor by the creditor,
showing how much is owed and for what, is the
.............of account.
12.The shareholders investment in a company is the
share..............
ADVERTISING

Abstract: Advertising is the greatest art
form of the 20
th
century. It may be described as a
science of arresting human intelligence long
enough to get money from it. It stimulates debate
and sometimes controversy. It has a powerful
effect on the human consciousness as it is around
us on television, radio, cinemas, newspapers and
magazines.
Key words: message, ads, expensive,
media, products, audience, communication.

The way we dress, talk and behave sends a
message to other people. It is about manipulating
public opinion and getting a message across to an
audience so that they will behave in a particular
way.
The advertising industry has been in
existence since the end of the 17
th
century when
newssheets carried printed advertisements for
products and information. Merchants returning
from voyages overseas needed to generate
markets for the products they imported and so
they had to advertise. By the end of the 19
th

century, advertising was big business.
Advertisements dominated the newspapers,
posters were commonplace and spawned a whole
art form. But the new communication technology
gave the industry its biggest boost. Modern
advertising exploits every medium of
communication. We tend to think of
advertisements in terms of the mainstream media
but we also have posters, billboards, point of sale
displays, direct selling and cold calling by phone
and fax, the internet which taps into worldwide
audiences.
If you work in advertising , you will for
sure be part of an influential band of people who
can change public attitudes and behaviour.
The heart of this industry lies in the
advertising agencies. The large ones are
multinationals with in such far flung places as
Beijing and Buenos Aires. If you work in a small
agency, you may be expected to do everything,
including account management, client liaison,
concept development, creative work. In a larger
one, job roles will be more structured. You will
have a specific role and a greater chance of more
formal career development. Advertising agencies
vary in the services they offer. The most familiar
names are full service agencies but there are also
other companies that specialize in media services
or focus on particular areas of advertising, such
as recruitment or business to business
advertising.
Advertising is aimed at conveying
information to potential customers and clients.
Advertising is used to persuade the public
to buy.
At the lowest level people need food,
shelter, warmth and sex. Then, people begin to
think about personal possessions and finally we
move on to egocentricity.
The ultimate need is for fulfilment. This
would come when we have all that the advertisers
say we so desperately need. For most of us it
seems that that day will never come!
Sometimes advertisements are misleading.
Advertisers shouldnt make untrue statements
about their products but they so often do it. They
create a demand which would not otherwise
exist.
Advertising goes far beyond T.V. and
hoardings, newspapers and magazines, they
enrich our lives.
Answer the following questions:
What are the arguments for and against
modern advertising methods? Are there
any controls which you think should be
imposed on advertisers?
Glamour and humour are two of the
appeals which ads try to make for us.
What other appeals do they make?
In what other ways, apart from
advertising are we persuaded to buy one
product rather than another?
How do national newspapers benefit
from advertising?
How can window dressing be seen as
forms of advertising?

Arguments for advertising
It tells consumers about the
products that are available,
allowing them to make a wider
choice.
It encourages competition between
firms.
By creating a wider market for
products it makes large scale
production and sales possible.
Media would be more expensive
without it.
Arguments against
It is expensive.
It can be wasteful, sometimes
involving the same firm advertising
virtually identical products against
each other. (eg. washing powder )
It can be misleading.
It can exert control over media.
It can put pressure upon people to buy
products that they dont really need or
cant afford.
Advertising media
National newspapers
Regional newspapers
Consumer magazines
Business and Professional Directories
Press production costs
Poster and Transport
Cinema
T.V, Radio
Banners on Internet sites
Television commercials
The most effective medium for
reaching large numbers of people.
They have to be brief.
But:
They cannot be very informative and
display images rather than
information.
They are selective it is hard to reach
a particular group of people except for
certain programs.

Radio
-advertising is cheap and can be effective in
reaching certain types of people: old
people and housewives.

Magazines and trade press
It is a way of reaching a specialized group
of customers.
There are magazines for almost any interest
and for any type of product.

Posters and hoardings
-Effective if good locations can be found.

Sales promotions
-They include free gifts, competitions, give
away samples, special offers.

Sponsorship
-Of the arts, public works, sport can be very
effective in putting a product or company name
before the public.

Packaging and display
-In shops; they maintain existing sales but
also encourage first time buyers.
Here are some advertisements.
a. when you cant say good bye!
b. from here to eternity
c. you know the name. Its the face
you may not recognize
Enlarge on them.
Make an advertisement for:
a. a shampoo
b. a drink
c. a book
d. a restaurant
e. a sofa
# Write some adverts that promise:
youll feel happier
youll enjoy life more
youll have a nice holiday
youll be rich
youll be famous
# Make an advert as the one below:
Friendly, humorous boy 20, not very good
looking but funny, seeks nice girl to go
swimming, dancing, walking.
# Complete the following sentences using
your own words:
Advertising can help a business to

> A good advertising agency will

> Although newspapers and magazines

> One of the weaknesses of human
beings is that
> It is essential that the packing of a
product should be

This is the information about a job advertisement:
Asian Monetary Institute
Computer Programmer in the Statistics Division
The successful candidate will have
A University degree in economics or statistics
Work experience in banking and financial accounts
Fluent English and Mandarin
Applicants should send a C.V., a recent photo and
references from previous employers to the Asian Monetary
Institute P.O. Box 6707

Questions:
1. What does modern advertising exploit?
2. Why are advertisements misleading?
3. Are there arguments against
advertising?
4. How can window dressing be seen as
forms of advertising?
5. Which is the ultimate need for
advertising?

Answer the following
1. What is Hello: a magazine or a newspaper?
2. Which country in the world spends the most
on advertising: U.S.A or Japan?
3. Why is William Caxton famous: he
produced the first printed advertisement in
England or in U.S.A. ?
4. How did the earliest advertising take place?
5. Who invented paper?
6. How do we promote ourselves?
7. When did TV advertising come to Britain?
8. What is advertising industry entitled to do?
9. What is the difference between small and
large advertising agencies?
10. What does modern advertising exploit?
11. What do advertising campaigns bring?
12. What is business to business advertising?
13. What does concept development refer to?
14. How important is timing in advertising?
15. Which are the advantages and
disadvantages of advertisements on the
internet?

Make an advertisement for:

1. Your Town and the Surroundings.
2. A Museum
3. A Car.
4. A Hypermarket
5. A Magazine
Enlarge upon the following:
More than a watch. A dream that has come
true!
It is not just a broken vase. It is the silence
you feel when your shoppings are being
protected with the credit card.
They are the snapshots of a challenge, they
are always with us!


Money

All values in the economic system are
measured in terms of money.
Our goods and services are sold for money
and money is in turn exchanged for other goods
and services.
Coins are adequate for small transactions,
while paper notes are used for general business.
We also have a wider sense of the word
money covering anything which is used as a
means of exchange.
Originally, a valuable metal (gold, silver,
cooper) served as a constant store of value; even
today, the American dollar is backed by the
store of gold which the US government
maintains.
As gold has been universally regarded as a
valuable metal, national currencies were many
years judged in terms of gold standard
Today national currencies are considered to
be as strong as the national economies which
support them.
Valuable metal has been replaced by paper
notes. They are issued by governments and
authorized banks and are know as legal tender.
Cheques and money orders perform the
function of substitute money and are known as
instruments of credit
Credit is offered when creditors believe that
they have a good chance of obtaining legal
tender.
If a mans assets are known to be
considerable then his credit will be good. If his
assets are in doubt then it may be difficult for
him to obtain large sums of credit.
The value of money is basically its value as
a medium of exchange or its purchasing power
which is dependent on supply and demand.
The demand for money is reckonable as the
quantity needed to effect business transactions.
An increase in business requires an increase
in the amount of money coming into general
circulation.
But the demand for money is related not
only to the quantity of business but to the rapidity
with which the business is done. The supply of
money is the actual amount in notes and coins
available for business purposes. If too much
money is available, its value decreases and this
condition is known as inflation.
The unit of English coinage is the pound
sterling which is worth 100 new pennies.
The symbol is always placed before the
figures.
The abbreviation of p is written after the
corresponding figures.
The Bank of England issues banknotes for
1, 5, 10, 50 and 100. there are three bronze
coins (half penny), the one and two new
penny, two copper- nickel coins: the five and ten
new penny. Then there is the 50p. coin.
# The unit currency in U.S.A:
dollar a paper bill or a silver coin.
- banknotes of $ 1, 2, 5, 10, 20, 50, 100,
500, 1000
- coins 1 5 (nickel), 10 (dime), 25
(quarter), 50 (half dollar) are made of silver.
# How can you ask for a price?
How much is it?
How much does it come to?
How much do I owe you?
How much do you charge?
Its very expensive
Its rather cheap
Im short of money, can I buy cheaper?
# Say whether these statements are true (T)
or false (F)
The U.S. dollar is a constant store of
value.
Instruments of credit are accepted
because they can be converted easily into
substitute money.
The purchasing power of money depends
upon supply and demands.
The demand for money is related to the
rapidity with which business is done.
You can earn interest on a current
account.
Banks lend money to depositors who
need capital.
The main profits of a bank come from
lending money at a fixed rate of interest.
Money is described as liquid because it
is compared to flowing water.
Everyone borrows money. And when you
do this you improve your lifestyle. It may be a
risk but it also promises great rewards. Where do
you borrow money from? Banks are considered
to be profit making machines. They come in all
shapes and sizes and they help you.
Lending money becomes one of the main
functions of a bank. It is the interest earned from
banks that brings in most of the revenue to pay
the expenses, including staff salaries of the bank
and give a sufficient surplus to pay shareholders
a dividend and retain funds in reserves accounts
for the expansion of the bank. Before any loan is
granted, the following questions must be
answered by the customer:
- how much is required?
- the purpose of the loan
- length of time the advance is
requested
- the source of repayment
We have the following sources of funds for
the Romanian banks:
- bank deposits(Short term, long
term)
- borrowed funds
- own funds(own capital,
supplementary capital)
The funds that are put out on loans belong
to customers. It is their money that is put at risk,
so if a bank is making bad or unprofitable loans,
this will be reflected in the deposits.
Types of credit or loans:
1. Country loans.(in order to achieve
national, political, social and economic goals)
2. Corporate lending.(such as loans for:
- working capital and fixed assets
- overdrafts
- term loans
- syndicated loans
- revolving credit
Types of credits:
1) Revocable credits(may be cancelled
or amended at any time without prior
notice being given to the beneficiary)
2) Irrevocable credits(can be cancelled
with the agreement of all parties)
3) Sight credits(allow for payment to be
made as soon as documents are
presented)
4) Deferred credits (it allows for
payment at a future date without
calling for a Bill of Exchange).
5) Transferable credit (it can be
transferred by the original beneficiary
to one or more second beneficiaries).
6) Red clause credits (incorporate a
special concession to the beneficiary
allowing the advising bank to
advance a percentage of the total
credit amount before presentation of
the shipping documents).
7) Revolving credit (the amount can be
renewed or reinstated without specific
amendments to the credit being
needed).
8) Stand by credits (acts as a guarantee
by the issuing bank to the overseas
beneficiary against defaults by its
applicant customer).

The main principles of granting credits are:
- the banking prudence
- the creditworthiness of the
borrowers
- the credits granted should be
profitable both for the bank and
for the borrowers
- the credits have a destination
precise and mandatory which
cannot be changed by the
borrowers.
- credits are granted under
guarantees that are written in the
credit contract.
- The bank shall reserve the right to
verify its customers.

Forms of Payment:
1. Cash (small amounts can be sent
in note form very easily,
impractical and expensive if in
large amounts).
2. Cheque(remittance is quick and
simple, exchange risks unless
issued on appropriate currency
account, delay in receipt of
proceeds by beneficiary where
bank insists on collection)
3. Bankers Draft(issue process is
straight forward; available in
major currencies, expensive to
purchase, involves lengthy
formalities including giving an
indemnity to the bank)
4. International Money Order(cheap,
issue process is quick, but
appropriate for smaller amounts
up to GBP 1000 or USD 2,500..)
5. International Payment Order(no
limit of amount, documents can be
attached, payment is inter- bank,
therefore secure, not appropriate
for urgent transfers)
6. Telegraphic Transfer(quick, no
limit on amount, an expensive
method)
7. Giro Cheque (inexpensive, but can
be lost or stolen, remittance is
quick and simple)
8. Giro Transfer (simple and quick,
number of countries limited)
9. Postal Order (exchange risk for
the recipient, can be lost or stolen,
number of countries limited).
How ca you define a bank risk?
It is that risk that the bank is being
confronted with in its current operations. Banks
are subject to all the risks that their customers
face. The most significant is the the credit one
that arises from lending to individuals,
companies, banks, governments.
The main types of risks involved in the
banking activity are:
1. The Financial Risks
2. Delivery Risks
3. Environmental Risks
Financial risks:
- Credit risk
- Interest rate risk
- Liquidity risk
- Foreign exchange risk
- Capital risk

Delivery risks:
- operational risk
- technological risk
- new product risk
- strategic risk
Environmental risks:
- defalcation
- economic
- competitive
- regulatory
Some British authors divide the main risks
into :
1. product market risks
2. capital market risks
Product Market Risk
- credit risk
- strategy risk
- bank risk
- operating risk
- merchandise risk
- human risk
- legal risk
- product risk
Capital Market Risk
- interest rate risk
- liquidity risk
- currency risk
- discount risk
- basic risk
We may also have:
The fraud risk
The country risk
The market risk

Electronic Banking Services
Electronic banking- essentially automated
payment by computer - will increase in importance
and volume. The main forms of electronic banking
services are:
Telephone Banking
Such a service represents a competitive area
and it may be either voice-activated (i.e. the
computer is expected to react to customer's voice
and comply with his or her instructions accordingly),
or electronically activated (the client speaks over the
microphone of their telephone and dials certain
numbers meaning a certain transaction). The telephone
banking can offer transfers of funds, payments of
regular bills, applications for loans and overdrafts etc.
Bankers Automated Clearing System
This system is especially used for funds
transfers between the participating members and
essentially operates standing orders, direct debits,
payment of wages, salaries, rentals, trade debts, etc.
Bankers Automated Clearing is supplied with a
magnetic tape containing the details of the
accounts to be debited or credited. It sorts them into
bank orders and, then, it provides each paying bank
with the relevant details, a printout being also
Electronic and Internet -Based Payments
Internet banking is a banking product, which
follows the older solutions like e banking. E-banking
represents a solution which is technologically
obsolete, supposing at the client level of that service
a phone line and a computer dedicated for such an
operation, able to fulfil technical needs quested by
the bank and to run (execute) a software program
necessary for lie optimal communication with the
client's bank. In that way, the person who will handle
the e-banking application have to work only from
that computer which it is not very good for someone
with a dynamical job and with many physical places of
work even in different localities or countries.
Despite e banking, the I-banking (Internet-
banking) supposes the usage of a computer from wide
world on which is installed a browser and an Internet
connection. The performances of such a solution are far
away better also for the bank and for the end user (the
client).
The costs are calculated to a number of 100
banks from the United States of America which are
using all the channels, but the costs are represented at
a world wide level because they are common to all
the banks that promote the electronic payments.
SWIFT
These initials stand for the Society for
Worldwide Interbank Financial Telecommunication,
which is an international organization whose members
consist of several hundred of the largest international
banks. The society, which was created under Belgian
Law and located in Brussels, was formed to accelerate
the transfer of funds and other messages between the
member banks. .
The system works by means of a
telecommunication link between the computer systems
of the banks, which allows the rapid transmission of
messages. The system is used to execute telegraphic
transfers previously sent by cable or telegraph and may
also be used for international payment orders/airmail
transfers at the discretion of the bank, making for a
much faster execution of a customer's instructions.
When instructions are transmitted in this way the bank
is said to be sending a SWIFT message and for
telegraphic transfers the phrase used is urgent SWIFT
message.


Test Your English

I. Fill in the gaps with the following words
and phrases: accounting, bank ,
budget, costs, expenses, figure,
market, operational, repositioning,
strategy.
BCR, the largest bank on the
(1)_____________________has entered "a
programme of essential and fundamental
changes," which cover
(2)______________________structures and
organisation,
(3)______________________systems and
institutional culture, Nicolae Danila, the banks
chief executive announced yesterday. "BCRes
success today is not necessarily guaranteed to
continue over the following years. The best time
for change, for (4)__________________is when
business is flourishing," Danila stated. The
programme for integration into the Erste group
and to develop the operations has a
(5)______________________of approximately
200 million euros, of which some 150 million
euros should be spent this year. This
(6)______________________accounts for both
integration (7)______________________and
investment (8)______________________Part of
the investment should go to support territorial
network expansion from 478 branches to about
700 by 2009. Banca Comerciala Romana (BCR)
aims to boost profit by 62% and assets by 31% in
2007, compared with the 2006 figures, the banks
chief executive Nicolae Danila told a news
conference yesterday. He specified the results
were estimated in line with the Romanian
(9)______________________standards. The
biggest (10)______________________in
Romania, controlled by the Erste group, made a
net profit of almost 830 million RON (some 240
million euros), bank sources told Mediafax in
January.

II. Complete the gaps with suitable words:
1. I havent spoken English
_______________________ ages.
2. I couldnt understand what he was talking
_______________________.
3. Where does she come
_______________________?
4. My friends _______________________ me it
was a good film last night.
5. I always _______________________ the
same mistakes when I speak fast.
6. He cant do that _______________________.
He needs assistance.
7. The next train should arrive
_______________________ a few minutes.
8. I met her many years
_______________________.
9. The word for "two weeks" is
............................ .
10. Im looking _______________________ to
my high-impact business English training.
11. The merger of the two companies
___________________ many changes.
Lexical Index

Advert - anun n ziar
Advertisement anun, reclam, publicitate
Advertisement canvasser prospector de
publicitate
Advertisement column rubric anunuri
Advertisement department serviciu de
publicitate
Advertisement manager director de
publicitate
Advertisement office birou de primire a
anunurilor
Advertising agent - agent de publicitate
Advertising appeal - atracie publicitar
Advertising contest - concurs de reclame
Advertising directory - anuar de publicitate
Advertising expenditure - cheltuieli de
publicitate
Advertising rates - tarif de publicitate
Advertising schedule - calendar al
anunurilor
Drawback - neajuns
Folder pliant, dosar
Hoarding.- plancard
Misleading neltor
Poster afi
Target customer client int
To advertise a face reclam
To boost - a populariza prin reclam
Want ads anun la rubrica cereri de
serviciu
The picture flickers imaginea plpie
The picture is blurred imaginea este
estompat.
The picture is distorted imaginea este
deformat.
The picture washing out imaginea se terge.
Time signal ora exact.
To bribe a mitui
To broadcast a transmite
To browse through a rsfoi
To cover news a relata, a comenta.
To hint a face aluzie.
To issue a edita..
To re-edit a reface
To release a lansa

Base rate - curs de referin
Blue chips stock - aciuni sigure
Bond - obligaiune,garanie
Bond market - piaa hrtiilor de valoare
Brand image - imagine de marc
Brand leader - cap de serie
Brisk market- piaa activa
Canvasser - prospector de pia
Deferred shares - aciuni ealonate
Demand - cerere
Demand rate - curs la vedere
Futures - piaa livrrilor la termen
Hardening of the futures - redresarea pieei
Home demand - cerere intern
Home market - piaa intern
Margin - marj
Margin in cash - acont n numerar
Margin of profit - marj de beneficii
Market overt - pia public
Market share - cota pieei
Market swing - tendina pieei
Market value - valoarea comercial
Prices levelled off preurile au atins un
nivel constant
Prices picked up - preurile s-au redresat
Prices rocketed - preurile au crescut
vertiginos
Rate of exchange - curs de referin
Rate of interest -.rata dobnzii
Rate of return - rata de recuperare
Revenue - venit al statului
Sales plummetted - vntrile s-au
prbuit
Sales topped - vnzrile au depit
Securities - garanii,titluri
Security - valoare,titlu
Settlement day - zi de referin
Soft market - pia n scdere
Steady demand - cerere permanent
Steady market - pia stabil
Stock account - cont de capital
Stock adventure - speculare de aciuni
Stock holder - acionar
Stock on hand - stocuri nevndute
Supply - ofert
Terms of supply - condiiile livrrii
To dabble in the stocks - a juca la burs
To take stocks - a cumpra aciuni
Uncertain market - pia nesigur
Underwriter - garant
Venture capital - capital de risc
Yield - venit al unei investiii
Account cont
Account book registru de conturi
Assets- active
Bank return venitul bncii
Bill of exchange /draft cambie
Board of trade returns statistic
comercial
Bounds obligaiuni
Bullion - lingou
Cash account cont n cas
Cash assets capital n numerar
Cash deposits vrsminte n numerar
Cash flow fluxul numerarului
Cash in hand numerar disponibil
Cheque to bearer cec la purttor
Cheque to order cec la ordin
Currency depreciation devalorizare
monetar
Current account cont curent
Debenture bounds obligaiune cu
dobnd fix
Deferred payments - plai ntrziate
Deposit account cont de depozit
Earnings venituri
Expenses cheltuieli
Figure cifr
Financial backing sprijin financiar
Financial futures contracte pe termen
Gamble joc de noroc
Gross return beneficiu brut
Hard currency valut forte
Interest dobnd
Legal tender currency moned legal
Let down declin
Money chest cas de fier, seif
Money in cash bani lichizi
Money market pia monetar
Money on deposit bani depui
Money pressure lips de bani
Overdraft- sold debitor
Pay in ship borderou de vrsmnt
Payee - beneficiar
Return venit, beneficiu, rambursare
Revenue venit mare, ctig
Revenue assets capital circulant
Revenue office administraie financiar
Saving bonds titluri de economii
Savings economii
Tax return declaraie de impozit
Tenor scadena unei obligaiuni
To earn a ctiga
To get into dept a avea datorii
To grant a loan a acorda un mprumut
To open an account a deschide un cont
To owe a datora
To save money a economisi bani
To settle an account a lichida un cont


Additional Vocabulary:
chartered company- companie nfiinat pe baza
unei Carte Regale
joint stock c.- societate pe aciuni
unlimited c.- societate cu rspundere nelimitat
limited c.- societate cu rspundere limitat
parent c.- societate mam
winding up of a c.- ncetarea activitii unei
societi
greenfield c.- societate la nceput de drum
bogus company- societate fictic
close c.- societate nchis
dormant c.- societate inactiv
company funds capital al firmei
company identity- imagine de marc
to stay afloat- a se menine pe linia de plutire
shareholder-acionar
shares- aciuni, titluri de valoare
preference shares- aciuni priviegiate
deferred shares- aciuni cu plata dividendului
dup satisfacerea celorlalte
outstanding shares- aciuni n circuaie
share capital- capital social, n aciuni
share market- burs de aciuni
share prices- curs
share index- indice
share split- divizare a aciunilor
to share the profit- a mpri profitul
to share ones views- a mprti prerile cuiva
to share ones experience- a mprti experien
to assess-a evalua
assessment- evaluare
assessed- evaluat
turnover- cifra de afaceri
loss-pierdere, deficit
to run at a loss- a lucra n pierdere
loss ratio- rata pierderilor
relocation- mutare
core business- activitate de baz
break up- lichidare
liable- responsabil de
to grant- a acorda
storage- depozitare
subsidized price- pre subvenionat
brand name- marc de fabric
to book an order- a nregistra o comand
sale- vnzare
sale by sample- vnzare cu mostr
sale for future delivery- v. la termen
sale on hire purchase- v. cu plata n rate
sales outlet-punct de desfacere
sales quota- cota de vnzri
sales records- evidena vnzrilor
sales department- serviciul commercial
overstock- depire a stocului
price advance- majorare
price alignment- aliniere
price collapse- cdere
price cut- reducere
price gap- decalaj
price maintenance- meninere
price shading- reducere mic
price freeze- ngheare
price ceiling- plafon de preuri
blanket price- pre global
bid price- pre oferit
bottom price- preul cel mai sczut
ceiling price- preul maxim
flat price- pre unic
floor price- pre minimal
peg price- stabilizare
purchase price- pre de cumprare
sell price- pre de vnzare
invoice- factura
delivery- livrare
middleman- intermediary
convenience stores- magazine locale
out of stock- lipsete din stoc
sole selling rights- drepturi de vnzare
exclusivist
world market price- pre de pe piaa mondial
store layout- configuraia magazinului
to negotiate a loan- a negocia un mprumut
ongoing negotiations- tratative n desfurare
negotiations in progress- tratative n desfurare
joint- comun
joint bargaining- negocieri commune
joint owner- copropietar
joint management- conducere colectiv
outcome- rezultat, consecin
to settle- a stabili, a soluiona, a reglementa
to claim- a pretinde, a cere, a revendica
to score- a nregistra, a nota, a marca, a obine, a
realiza
scheme- plan, aranjament, combinaie
damage- daun, prejudiciu
to adjourn- a amna, a suspenda
adjournment- amnare, suspendare, ntrerupere
to adjust- a adapta, a ajusta, a corecta, a aranja, a
pune n ordine, a aplana
adjustment- ajustare, potrivire, corectare,
adaptare, aplanare, acoperire.
to involve- a implica, a antrena
involvement- implicare,participare
to enforce- a aplica, a pune n vigoare
enforceable- aplicabil
enforceability- aplicabilitate
enforcement- aplicare a unei legi
to bind- a lega, a ncheia, a impune, a oblige, a se
lega, a se oblige
binding- legtur
concession- concesie, recunoatere
to incur- a contracta, a asuma, a suporta, a suferi
to induce- a convinge, a determina la, a impinge
la, a hotr la
guaranteed- garantat
guarantee- garanie, siguran
to chair- a prezida
chairman- preedinte
to decree- a decide, a emite un decret
meeting- ntrunire, edin
to call a meeting- a convoca o edin
notice of meeting- notificare a aunrii generale
to brief- a rezuma, a instrui
briefing- instruire, informare
briefing conference- conferin de ndrumare
to exchange- a face schimb
to establish- a stabili,a institui, a ntemeia, a
instala
establishment- instituie oficial,
stabiliment,organizaie public sau privat,
fondare
timing- sincronizare
outright- deschis, cistit, total
outright loan to a project- mprumut direct pentru
proiect
outright grants for research- alocaii integrale
pentru cercetare
bias- eroare sistematic, distorsiune
disability- neputin, incapacitate
disabled- incapabil de
to trigger- a declana, a porni, a lansa
liable- rspunztor, supus
commitment- angajament
to reinforce- a consolida,a ntri
reinforcement- consolidare
to share- a mpri
to share in- a lua parte la
to share out- a repartiza, a distribui
guidelines- directive
deputy manager- director adjunct
sales manager- director commercial
acting manager- director interimar
layout of a meeting- amplasare
to take charge- a-i asuma responsabilitatea
turnover-cifra de afaceri
merger- fuziune
outright loan- mprumut direct
outlet- pia de desfacere
slump- criz
funding- finanare
boom- avnt
long term- pe termen lung
medium term- pe termen mediu
short term- pe termen scurt
restrictive practices- practice anticoncureniale
leveraged- ndatorat
divestitures- sciziune
to bail out- a salva
golden parachutes- compensaii financiare
garantate
lay offs, redundancies- concedieri, disponibilizri
joint ventures- societi mixte
ailing- n dificultate
to spin off assets- a distribui activele
tender offer- ofert public de cumprare
junk bond- obligaiune speculativ
corporate governance- conducerea nterprinderii
leveraged buyouts- preluarea controlului prin
mprumut, cumprarea de ctre salariai.
to bid- a face o ofert financiar
buyout- cumprarea unei firme n totalitate
Boundless- nemrginit
Bottom line- de baz
To dispatch-a trimite, a rezolva rapid, promt
Cash flow- flux monetary
To draft- a redacta, a ntocmi
To exchange- a face schimb
Web browser- program software pentru navigare
pe internet
Joint venture- societate mixt
To display- a expune, a afia
Impending- imminent
Expenditure- cheltuial
Allowance- reducere
Scalability- capacitate de a grada
To hook- a prinde, a aga
Hook up- program comun, nlnuire
To knuckle down- a se apuca de
Tip- informaie
Secure- n siguran, care nu prezint risc,
garantat
To secure- a proteja, a asigura
To store- a stoca, a memora
Ongoing- nentrerupt
Backer- susintor,girant
To back- a sprijini, a susine, a gira,a da ndrt
To back down- a o lsa mai moale, a bate n
retragere
To err- a grei, a face o eroare
To bud- a ncepe
To litter- a murdri
Fickle- nestatornic, capricios
To highlight- a evidenia
Claims- cereri, revendicri
To comply with- a se conforma
Encasement- ncasare, plat n numerar
Rental- valoare locativ
Obsolete- demodat, nvechit
Would be customers- clieni poteniali
In sequence- n succesiune, unul dup altul
Venture capital- capital de risc
Venture- speculaie, risc,aciune comercial
Watertight- ireproabil, impecabil, clar
To default- a fi n restan, n ntrziere cu plata
Diligence- osteneal
Due- cele cuvenite
To slant- a denature,a prezenta tendenios
Slant- punct de vedere, opinie, nclinaie, tendin
Onerous- apstor,mpovttor
Bibliography:

Elvy Howard, Marketing, Clays Ltd,1992
Valdez Stephan, An Introduction to Global
Financial Markets, MacMillan Business,
London,2000
Karen Kolmes, Advertising, Marketing and PR,
the Industrial Society,2000
Howells Bain, The Economics of Money,
Banking and Finance, Pearson Education
Limited, 1998
Philip Berman, The Courage of Conviction,
Ballantine Books,1985
Hendrie Weisinger, Emotional Intelligence at
Work, Jossey bass, 1998
Buckley Adrian, the essence of Consumer
Behaviour, Prentice hall, 1997
Hartly Peter and Bruckmann Clive, Business
Communication, Routledge, London, 2002
Vernon Mark, Business. The Key Concepts,
Routledge, London, 2002
Jacob Brian, An Introduction to banking, Holt,
Rinehart and Winston, London, 1990.


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