Classification of companies according to their magnitude

  

 By Raúl Gorrín.-    In the previous chapter, we talked about the classification of companies and we refer to the activity and the capital. Today we will mention how organizations are classified according to their size. So, we have that the companies can be small, medium or big, although it is usually differentiate between big companies and small and medium companies or SMEs. 

·         Small companies: whose capital, income and number of workers is small, with no more than 20 people working in them.

·         Micro-enterprises: they have capital, number of workers and income in personal amounts. They haven’t more than 10 employees.

·         Family enterprises: the family is the engine of the business.

     Another type of business classification is according to its legal form, which is done according to who owns the organization and the legal responsibility of its owners.

·         Individual companies: are constituted by a single person who responds to third ones with their assets with unlimited liability or up to the amount contributed to the company. 

·         Cooperatives and social economy companies: are formed by several people. These are companies of collective partnership and limited liability. 

·         They are anonymous societies, commanding societies and societies of simplified actions. 

     Another way to classify companies is according to their state range, which can be:

·         Nationals: when they carry out their activity in one country.

·         Multinationals: when they develop activities in several countries at the same time. These are usually big companies.

·         Regional: when they take their action in to a one area.

·         Local: the companies that are circumscribed to its locality.

     Similarly, companies can be known as:

·         Financial: they are classified by the amount of their capital.

·         The organizations that are classified according to the personnel.

·         Small companies: have less than 250 employees.

·         Medium companies: have between 250 and 1000 employees.

·         Big companies: have more than 1000 thousand workers.

     By sales, companies are ranked according to the amount of their sales in the market and finally, they can also be classified according to production and taking into account the degree of machining of production processes.

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Types of distribution channels

  

  By Raúl Gorrín.-  We have already mentioned the importance of distribution channels. Now let us refer to the types that exist.

·         The direct channel: is the shortest. This channel takes place when a producer sells directly to the final consumer without the intermediaries’ intervention. This channel is the one used to sell services; here the sales are face to face or via Internet. The important thing is that there are no wholesalers present.

·         The indirect channel: the distribution process is carried out with the participation of intermediaries.

     According to the number of intermediaries involved for the delivery of the product is subdivided into:

·         Short: also known as tier-2, which is characterized because there is an intermediary. So, the product goes from the hands of the manufacturer to the distributor and from there, to the consumer.

·         Large: this occurs when the product changes hands at least three times (tier-3). From the manufacturer to the initial wholesaler who intervenes to distribute it, then is in the hands of a retailer and finally, the consumer. Likewise, it may happen that more intermediaries intervene. Because the product goes through the hands of storekeeper, distributors, marketers, resellers. Every link will increase the product value.

     When choosing a distribution channel, it is necessary to take into account some considerations, because the referred channels are the most common, they are not the only ones. In this sense it can be chosen, even the combination of these to repair to the characteristics of the market, the product and / or service and the company. It is essential to keep in mind that the greater the number of channels involved, the less controls of the process and the more complex the channel. The smaller the steps the product gives from the manufacturer to the consumer, the greater the economic burden on the manufacturer.

     It can’t be forgotten that the Internet can now intervene, which is more suitable and efficient for the purchase and sale of supplies and raw materials. In any case, it should be noted that it can’t be sold directly to the final consumer. In fact, there are very interesting options such as virtual stores in which the producer or the manufacturer are directly understood with the final consumer, something that happens at local, national or international level.

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Management functions

  

 By Raúl Gorrín.-  The manager has to learn and develop some skills and exercise leadership to be able to have ascendancy in his subordinates. The manager is in charge of the management, administration, staff selection, while having some financial or negotiation skills. There is no shortage of those who add leadership to these functions, since it is effective in the administration and management work. The manager is responsible for developing organizational tasks through the coordination of the individual efforts of the members of their work teams. It is a systematic and very laborious work.

     The manager has to also carry out a set of activities of an administrative nature. This has been the case since the beginning of the 20th century when the world was urgently needed to be put into operation, and efficiency in companies had to be increased and the legacy of the Industrial Revolution had to be maximized. Since then, it has been established that there are fourteen basic principles of management, namely: unity of command, authority, unity of direction, centralization, subordination of private interest to general, discipline, division of labor, order, hierarchy, just compensation, equity, stability, initiative, and teamwork.

     Time has passed, but despite the changes in scenarios and the fact that now a set of new tools for the management of companies is available, most of these principles remain in force today, and at that time as in the present, the manager develops a plan and makes sure to work for it to be successful. That was the way it was before, and so it is now.

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