LWEO

chapter 5

chapter 5

An enterprise of one’s own

Many people think it is ideal to become self-employed later. Working in the employment of a boss seems to be less attractive. Still, what exactly are the advantages and disadvantages of an enterprise of one’s own compared with working in employment? And what does having your own enterprise entail? You need to do your own administration and there is a great number of questions that you are faced with then. For how do you calculate the expected turnover of your enterprise and what are the purchase costs that you can expect? How high will the operating costs be and how do you calculate the gross and net profit to be expected? And at the end of the month you can determine the actual turnover, costs, gross and net profit and only then do you really know whether all your efforts have been worth it.

When you have dealt with this chapter, you should be able to answer the above questions. This chapter gives you a rather good idea of what you can expect in the subject of Management & Organisation in 4 and 5 havo.

links
How do you start your own enterprise? (www.leren.nl)

glossary

Glossary chapter 5

business plan
A plan in which the entrepreneur indicates what the object of his enterprise is and investigates which rules (regulations, permits) his enterprise has to comply with. A business plan also gives an overview of the steps an enterprise must take to make its business successful.
cost of sales
The value of the raw and auxiliary materials in the sold products. Is equal to the sales x the purchase price.
employee
Works for a wage in the service of an employer.
employee benefits
Employment conditions relating to other elements than pay and hours such as holiday schemes, duration of the lunch break, travel allowance, childcare, schoo¬ling, company car, etc.
employer
Takes people into his service to do work for payment.
gross profit
Turnover minus the cost of sales.
net profit
Is equal to the gross profit minus the operating costs.
operating costs
Costs that are incurred to make or sell products.
pay and hours
Agreements between employer and employee relating to the wage and the normal working hours.
purchase prices
The price for which an enterprise purchases goods.
salaried employment
Somebody works in salaried employment when he has been hired as an employee by an employer on payment of wages.
sales
The number of products (pieces, litres, kg) which an enterprise sells. Another word for the quantity sold.
selling price
The amount for which a product is traded.
turnover
(= total revenue) The monetary yield of sold products. This can be calculated by: selling price × number of sold products (= sales).