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Economy of the enterprise - Pokropivny SF

1.5. Market environment of management of enterprises and organizations

The concept, functions and structure of the market . In a broad sense, the market is a sphere of manifestation arising between people in the process of production, distribution, exchange and consumption, economic relations. In a narrower sense, the market is the sphere of commodity circulation and the associated set of commodity-money relations that arise between producers (sellers) and consumers (customers) in the process of buying and selling goods.

Expanded interpretation reveals a very important essential aspect of the market, which makes it possible to determine its place and role in the process of reproduction: the market provides an organic link between production and consumption, is influenced by them and influences them. The real volumes and structure of various needs are determined on the market, the social importance of the production product and the labor expended for its production is established, the correlation between supply and demand, which forms a certain level of prices for goods and services, is established.

In addition to the special function to ensure the movement of goods from producer to consumer, the market performs a regulatory, control and stimulating function in the economic system of society. Through his mediation is determined exactly what, how, when and how and for whom to produce. Due to the law of value and the law of supply and demand, the necessary reproduction and proportions are established, the distribution of investment, material and labor resources between the spheres of activity and industries is optimized, and effective economic control is provided for a rational socially permissible level of production costs.

The stimulating function of the market is that it initiates the production of precisely those goods that consumers need. Through the mechanism of competition, market relations actively influence the increase in the range and improvement of product quality, the reduction of production costs and circulation, the exclusion from production and consumption of obsolete products that do not have the prospect of expanding sales.

The desire to gain an advantage in the market stimulates the intensive innovative activity of manufacturers aimed at timely updating the technical and technological base of the enterprise, the development of new types of products and services, and also reinforcing incentives for workers to improve their skills, creative and high-performance work.

Market relations have a general character, extend to all economic spheres and regions of the country, penetrate into all parts of the economic system of the state. A lot of subjects come into this relationship, and various goods and services enter the sphere of circulation, which formulates a complex and multidimensional market structure. The study of the latter makes it possible to comprehensively investigate the unity, interconnection and interaction of the constituent elements of the market, to seek and develop new organizational forms of economic ties and commodity-money exchange, supply and demand management, mechanisms for self-adjustment of the basic links of production to an effective mode of management. Proceeding from these tasks, the most common is the four-position approach to the general structuring of the market, namely: from the position of its subject composition, product-resource filling, element-technological links and territorial-spatial organization (Figure 1.7).

Fig. 1.7. Common market structure

The greatest coverage of market participants, their grouping taking into account specific features of market behavior is achieved by highlighting the five main types of the market:

• Market consumers - individuals and households who buy goods or receive services for personal consumption;
• The producer market - a set of individuals and enterprises that buy goods for use in the production of other goods and services;
• The market of intermediate sellers (intermediaries) - the aggregate of individuals and organizations that become owners of goods for resale or lease them to other consumers with a profit for themselves;
• The market of public institutions that buy goods and services for the public utilities sector or to support the activities of various non-profit organizations;
• International market - foreign buyers, consumers, producers, intermediate sellers.

Enlarged division of the market by subject composition, as well as its more profound structuring, taking into account the product and resource content, which covers the markets of food and non-food consumer goods, the markets of tools, raw materials, materials, energy and other types of production products, housing markets, Land, natural resources, etc. Have important analytical and practical importance for ensuring structural balance of the market, as well as development of marketing strategy by business entities.

To the most developed elemental and technical forms of the market, relatively separate and playing an important independent role as subjects of exchange in the reproduction process, belong: the market of means of production; Consumer goods market; Market innovations and information; The investment market; Labor market; Monetary and currency markets. The above-mentioned system of markets, in spite of the relative limitations of the elements included in it, covers the main cycles of the process of reproduction (innovative, investment, purely industrial), divides (with regard to unequal economic purpose, circulation and consumption) the social product for means of production and commodities, integrates Factors of production (labor and means of production), embraces the money market as a necessary prerequisite for the implementation of exchange transactions, the acquisition on the elemental markets of goods needed for certain consumption and reproduction processes. This determines its importance for understanding the priorities for creating key commodity markets as an indissoluble interconnected and interacting system that forms a market environment.

The market as the sphere of commodity exchange has its spatial and territorial limits. Taking into account the latter, as well as the scale of commodity exchange, local (local), regional, national, transnational and world markets can be identified . Each of them has its own specific features due to market capacity, varieties of goods and services sold, commodity turnover structure, the composition of commodity traffic agents (producers, intermediaries, consumers), infrastructural features, price level and other market factors.

The development of territorial markets, their interpenetration and integration into larger market structures is possible only on the basis of further deepening of the international division of labor. The latter extends the limits of market production to the maximum size at which these products can be sold with reimbursement of production and transportation costs and obtaining regulatory profits.

The uninterrupted functioning of such a complex and multilevel system as the market, which in developed commodity production is represented by more than twenty of its main types, requires a highly developed and widely ramified common and special infrastructure that takes into account market characteristics. The infrastructure of the market is a set of organizations (institutions) that have different areas of activity that ensure effective interaction between commodity producers and other market agents that carry out the turnover of goods, the promotion of the latter from the sphere of production to the sphere of consumption.

The most important elements of the market infrastructure include: commercial information centers, commodity-commodity funds, currency exchanges; Commercial, investment, issuing, credit and other banks; Transport and storage networks; Communication systems, and so on.

In ensuring the continuous movement of goods, the supplying and marketing organizations-intermediaries, the dealer network of wholesale and retail enterprises, rental and leasing points, repair and service centers for servicing products from consumers, insurance, audit, holding, brokerage companies, trading houses, Auctions, advertising agencies, exhibitions, the system of foreign trade organizations. There is also a correspondingly directed infrastructure for each of the previously considered specific types of markets. It takes into account the specifics of their organization, formation and functioning, peculiarities of communication and interaction of market agents.

Principles of behavior of business entities in the market. Along with certain laws of Ukraine, the norms and rules of economic management and legal responsibility for violating those in a market economy have formed and widely used in entrepreneurial activities generally accepted principles of behavior of business entities in the market. A special place belongs to the principle of social partnership , which, based on the breadth of the behavioral aspects and directions of their implementation, belongs to the basic, and therefore defines any developed market economy as socially oriented.

This principle stems from the fact that an enterprise as a socioeconomic entity is simultaneously an integral part of its external environment. Therefore, along with purely economic functions for the production of goods and services and the resulting maximum profit opportunities, the enterprise must constantly keep in view the issues of social development not only of its own workforce, but also of the local population. Only socially responsible behavior of all business entities can provide the necessary public consensus, a reliable partnership of entrepreneurs and other sovereign social strata and groups, state and public organizations.

Another important principle of market behavior is the principle of freedom of enterprise . The latter is ensured by certain rights of the enterprise, namely:

Firstly, the possibility of an initiative, independent, carried out at its own risk and under its economic responsibility, economic activity of any capable citizen of the state, citizens of other states within the limits of legal authority, as well as any group of citizens (partners) that are united for collective enterprise (joint-stock companies , Leasing collectives, unions, joint ventures, etc.);

Secondly, the independence of the organization of production (the choice of the direction of products or services) and its resource support (use for this purpose of its own property, the attraction on a voluntary basis of property (funds) of legal persons and citizens, as well as any other material, labor, intellectual and natural Resources except those whose use is prohibited or restricted by law);

Thirdly, the independence of any economic decisions, commercial freedom of pricing, based on economic benefits and market conditions, the right to determine the ways and means of selling products, including exported goods and services;

Fourthly, the real right to dispose of property, as well as the profit remaining after payment of taxes and other payments established by law.

These principles are concretized in a certain mechanism of self-regulation of economic behavior. The main components of this order are:

• Community of commercial interests and constant search for means of maximum satisfaction of consumers' needs;
• Mutually beneficial business relations, providing for ensuring sufficient profit for partners in economic agreements;
• Equitable relationships involving equal responsibility for violation of the terms of the agreement, and free choice of business partners;
• Responsibility of producers, sellers, trade intermediaries, ie all persons taking part in the production and circulation of goods before the final consumption of products;
• Self-limitation of personal consumption, voluntary aspiration for permanent production investment, possibly fuller satisfaction of new social needs, creation of additional jobs;
• Subordination of production and commercial activities to short-term successes, and ensuring a sustainable economic state of the enterprise in the long term; The achievement of commercial advantages only through innovative changes in all areas of activity.

In order to create a favorable economic environment, it is necessary to develop and maintain certain ethical standards of behavior of business entities in any market. They, along with common ethical values ​​(mutual trust, decency, diligence, honesty, respect for the person, faith in his strength, high motivation for creative work) also include rules of ethical conduct in business: loyalty to the word and helpfulness in relationships, business honesty and partnering Reliability, observance of trade secrets and other rules that meet the highest standards of business honor. All this taken together promotes the formation of the company's image as a partner with whom a long-term, reliable and mutually beneficial cooperation is possible, which is vitally important in a rapidly changing market environment.

Questions for self-study

• Characteristics of the enterprise (firm) as the primary link of the production sphere and legal entity.
• Methodological basis for substantiating the multiplicity of the objectives of the enterprise (firm).
• Legal bases of activity of the enterprises (firms) in the conditions of market economy.
• Trends in the dynamics of development in Ukraine the number of enterprises of different forms of ownership and with different numbers of employees.
• Socio - economic advantages of corporatization of state enterprises.
• Actual problems of substantiating the optimal production and general structure of enterprises of various forms of ownership.
• Feasibility and efficiency of setting up holding companies in certain sectors of the Ukrainian economy.
• Essence and content characteristic of the market sphere of domestic enterprises.
• In-depth evaluation of the basic principles of behavior of economic entities in the domestic and world markets.