In a market economy, the independent existence of individual small industrial enterprises continues, as a rule, no longer than 3-5 years. To survive in a competitive environment, various associations are created - a cartel, syndicate, trust, and concern. Consider the difference between these concepts.
Types of production associations
A cartel is a union of different enterprises of a certain industry. Each of the participants has independent ownership and the right to dispose of its products. The cartel participants are united by an agreement on the distribution of the sales market, on quotas for the production of one or another product, and joint regulation of prices.
Syndicate is a kind of cartel. Its participants also retain both legal and economic independence, but as a rule, a separate structure is created for the sale of products. This form is typical for enterprises in the metallurgical and mining industries.
A trust is an association in which previously independent enterprises lose their legal and financial independence. In this case, the merger of the property of the participants occurs. This is done either by combining the assets of individual entities, or by redemption by the parent organization of the trust of a controlling stake in other enterprises. That is, trusts are a form of merger in which all forms of production and economic activity of the participants are combined.
A concern is a union of legally independent enterprises of individual industries. Such associations can be “horizontal” or “vertical”; they collect representatives of technologically interconnected or separate types of industries into production chains . The entry of enterprises into concerns is characteristic of technologically complex industries. Moreover, all participants retain legal independence, having the status of joint stock companies.
The joint activities of the concern are managed by the parent organization, called the holding.
Trust as a single industrial and economic complex
The meaning of the word "trust" is based on the English trast - faith, trust. In the economy, “trust” is called both the process of transferring funds to trust, and the result of this activity - the combined assets themselves. In addition, this concept implies a serious financial responsibility of the one who takes the mentioned funds under his guardianship.
Thus, the concept of "trust" involves the unification of independent entities to conduct common production and economic activities. Participants can be legal entities or individual entrepreneurs.
A bit of history
The first trust appeared in the USA in 1879. It was a giant in the oil industry, Standardoil. The trustee managed the entities included in the trust. This model was later copied to other industries. In the Russian Empire, trusts were mainly foreign. Under Soviet rule, the decree of the All-Russian Central Executive Committee defined the trust as a state industrial enterprise endowed with the right to independent economic activity, approved the concept of authorized capital and introduced the distinction between fixed and current assets.
In 1927, a regulation on industrial trusts appeared, expanding the powers to manage property. But by the end of 1930, as a result of changes in the management of economic activity, their rights were severely limited. In the future, the concept of "trust" began to be used to refer to a separate production entity.
What is a construction trust
Construction is that branch of production, the specificity of which implies close cooperation of all participants in the process to organize common joint activities. Thus, a construction trust is an indicative model that gives an idea of trusts as such. Consider this concept in more detail.
Building trust is the main self-supporting element of management. He has material and labor resources and has economic independence. It consists of directly production units, support services and farms.
The main objectives of the trust are high-quality and timely construction and commissioning of capacities and construction projects, intensification of construction production and increase of its efficiency, rational use of capacities and increase of labor productivity, reduction of the prime cost of work and implementation of necessary environmental measures.
Building trusts are organizations that operate most often in a contractual manner. In this case, the facilities are constructed and delivered to the customer in accordance with the concluded agreements with the help of the company's own material, technical and personnel resources.
What are trusts?
Building trusts are not always homogeneous structures. They can vary greatly in terms of the nature of contractual relations (general and subcontracting), the type of work performed (general or specialized), and areas of activity.
In addition, construction trusts are organizations that have a clearly structured management system. Functional personnel include workers, foremen, foremen, surveyors and other persons directly involved in production activities. To linear - employees of the trust apparatus, performing the functions of preparing and ensuring the work process.
The trust is managed by its administration.