Business Profession and Employment
Thursday, October 18th, 2007 Business means the activities concerned with production or purchase and sale of goods and services for the purpose of earning profits. It refers to both private and public institutions which process and develop economic values in a society. A single isolated transaction of sale or purchase will not constitute business. Repeated or recurring transactions of sale and purchase alone mean business.
Business profession and employment differ from one another in the following ways
Mode of Establishment: A business enterprise may be established at any time by a decision of the entrepreneur. Legal formalities may have to be completed wherever necessary. For example to start a restaurant a license from the Health Department has to be obtained. Professional firm can be started by and professional holding a certificate of practice or who is registered with a professional body. For example a chartered accountant holding a certificate of practice can start a firm of chartered accountants. A person selected by an employer has to enter in an agreement of service. It involves employment with someone else while business and profession involve self-employment.
Nature of Work: A business firm is engaged in the production and purchase of goods and services for the purpose of sale transfer or exchange in order to satisfy the needs of customers. On the other hand a professional firm render personal services of a special used nature to their clients. In the case of employment an employee has to perform the work assigned to him by the employer under the agreement of swerves.
Basic Motive: Business activities are carried on primarily with the aim of earning profit. On the contrary professional activates are undertaken with the purpose of providing service and earning income. An employee performs his job to earn remunerating from the employer.
Qualification: A person doe’s not require a formal degree or diploma for starting a business enterprise. But in the case of profession specified academic qualification and practical training are essential. In employment education and training is not always essential. However qualified and trained persons get better employment.
Investment of Capital: A business enterprise cannot be established without some amount of capital or investment. The amount of capital depends on the size and scale of operations. A professional has to invest a limited amount of capital to establish his office or clinic. No capital investment at all is required in the case of employment.
Return or Reward: A businessman earns profit from his business. A professional earns a fee for his services whereas an employee gets wages or salary for his work.
Element of Risk: Risk is a part and parcel of business. A business may run into josses. A professional also faces risk but his fee can never be negative. An employee gets a fixed and regular salary. There is no risk in case of employment so long as the employer continues his operations.
Transfer of Interest: A businessman can transfer ownership of his business anytime at his will. But in the case of profession and employment such a transfer is not possible at all. A doctor or lawyer cannot sell or transfer this certificate of practice to anyone else. Similarly an employee cannot appoint any other person to work in his place without the consent and approval of the employer.
Code of Conduct: No code of conduct has been prescribed for a businessman. A professional is required to follow the code of conduct specifically prescribed for the profession. The conduct of an employee is governed by the rules and regulations prescribed by his employer.
