Linkage industries Revision
H I. AS always, it is a great pleasure to discuss another topic with you from the principles of business syllabus. We are still looking at production, and the topic of linkage industries is very important for efficient production.
An industry is made up of a number of firms producing broadly similar items or items that are connected to each other.
A linkage industry is an industry which is associated or connected to other industries in such a way that the existence of one is dependent on the other, or it enhances the other’s production process. These industries are also referred to as ‘spin-off’ and ‘screwdriver’ industries. Some examples of linkage industries are: Agriculture linked to tourism. Bagasse linked to sugar cane refining. Bauxite linked to aluminium. Petrol (gas) linked to crude oil refining. Agriculture linked to the canning industry. Road building in Trinidad linked to the asphalt industry. Can you think of other examples? Please add them to the list.
TYPES OF LINKAGES
Linkages are, first of all, INTERNAL (local) or EXTERNAL (international) and, secondly, either BACKWARD or FORWARD. Internal linkages are formed where all the industries that are connected exist within the same country. These industries are often sited near to each other. An external linkage is where one or more of the industries is located in another country, for example, the motor car assembly industry in CARICOM is linked to the motor car parts manufacturers all over the world. Internal and external linkages are also linked at different stages of production and, therefore, may be either backward or forward. A backward linkage exists when an industry OBTAINS raw materials from an industry that is closer to the raw material stage than itself, for example, the biscuit industry obtains flour from the flour mill. A (B obtains from A) B
A forward linkage exists when an industry SUPPLIES another industry that is nearer to the marketing stage than itself, for example, the agricultural industry supplies the tourist industry. A B (A supplies B)
OPPORTUNITIES FOR THE FORMATION OF LINKAGES
There are many opportunities for the development of linkage industries, especially where there are idle raw materials, where there are large amounts of unemployed persons, and where relationships have developed between the various productive sectors, for example, primary with secondary sectors. Also, because many of these industries are in proximity to each other, linkages have been encouraged. However, with the development of transport, this has become a less important factor. In instances where knowledge can be shared, linkages are also formed.
BENEFITS OF LINKAGE INDUSTRIES
1. Resources are more efficiently used. 2. More unemployed persons are able to find work.
3. Investment, national income and standard of living increase with the formation of linkage industries.
4. Countries are able to save on imports and increase exports through items produced by linkages. This will improve the balance of payments of countries and boost their economic development.
5. Linkages can encourage large-scale production, which can meet local as well as foreign demand.
6. Innovation and new technology can be promoted through linkage industries.
7. Self-sufficiency and self-reliance is encouraged.
From your reading, you can add other advantages. I will now point out a few of the problems experienced where the formation of linkages is concerned.
The greatest problem is the acquiring of capital to develop linkage industries.
Second, access to foreign markets is not guaranteed. Third, availability of local raw materials in some cases is limited and these may have to be sought from abroad using scarce foreign exchange. Again, you can add to these problems from your reading and previous knowledge. Finally, consider this question: (a) Define the term ‘industry’. (2 marks) (b) Explain the term ‘linkage industry’. (2 marks)
(c) Explain the difference between an internal linkage and an external linkage. (4 marks)
(d) Give FOUR examples of linkage industries. (4 marks)
(e) Differentiate between a ‘forward linkage’ and a ‘backward linkage’. (4 marks)
(f) Discuss TWO benefits of linkage industries. (4 marks)
TOTAL: 20 MARKS
HELLO, STUDENTS. I hope you are in high gears for your upcoming examination as the time draws closer. This week, I will answer the questions that you did last week. I will not repeat the questions. Good luck. 1. (a) Four reasons for good communication in a business (i) To provide information. (ii) To give or receive instructions. (iii) To encourage and praise. (iv) To set procedures. (v) To discuss and evaluate. (b) Three methods of communication – (i) Oral (conversation and meetings) (ii) Electronic (teleconference, video conferencing) (iii) Written (letters, reports) (iv) Visual (graphs, signals). (c) Characteristics of good communication:
CHARACTERISTICS
Influential factors Clarity Accuracy Effectiveness Completeness Specific
2. LETTER OF APPLICATION
10 Mona Road Kingston 10 03 April, 2017 The Human Resource Manager Whims International 17 Holbourne Road New Kingston Dear Sir/Madam,
HOW TO COMMUNICATE
The choice of the communication channel must be determined by the factors that influence it, for example, urgency. The recipient must be able to understand the message in term of language and expression, for example, appropriate language. Information (facts, figures, diagrams) must be correct. It must be well timed to produce the desired effect. Everything must be included. The message must not be misleading nor have double meanings. It must be relevant. The body should state that you are interested in the position advertised, give your educational attainments, and request an interview. Be sure you have the correct format for letter writing. This example is a blocked-style letter. Yours faithfully, I Douglas Ilene Douglas (Mrs) 3. (a) (i) must be well spoken (ii) friendly (iii) work well under pressure (iv) sensitive to the needs of people of all ages (v) pleasant (vi) computer literate.
(b) Application for employment, curricular vitae, payroll authorisation records, including direct deposit, vacation records, contract of employment, training acknowledgements, performance evaluation, termination notice, benefits information, internal complaints/grievances Personal records contain sensitive data on employees which may relate to health, family connections or medical reports, hence unauthorised persons should not get hold of these records. (c) (i) Give immediate attention. (ii) Make visitors feel welcome and comfortable. (iii) Follow-up if they are kept waiting. (iv) Offer seat and reading material. Create a good impression for your company. (i) Be professional. (ii) Keep reception area tidy. (iii) Answer telephone promptly. (iv) Be knowledgeable about the business. 4. (a) Characteristics of a good filing system: (i) Simple to operate (ii) Provides security for files (iii) Provides for tracing files (iv) Has a retention policy. (b) Retention – Length of time each document or record will be retained as an active record. Microfilming – Film on which materials are photographed at reduced size. Chronological order – Filing documents in date with the most recent on top. (c) Bridgeview Country Club, The Burke Yvonne, Mrs Harvey, Kirk L Jones, Neville (Dr) Payne C. D. & Co Ltd Thompson Paul (Sir)
5. Standing order – An instruction a bank account holder (the payer) gives to his or her bank to pay a set amount at regular intervals to another (the payee) account.
Credit card – A small plastic card issued to users as a system of payment. It allows the holder to purchase goods and services with a promise to pay for these at a later date.
Direct debit – A financial transaction in which one person withdraws funds from another person’s bank account; before the payer’s banker will allow the transaction to take place, the payer must advise the bank that he or she has authorised the payee to directly draw the funds. 6 (a) Services offered by travel agents – Preparing itinerary, making reservations – hotel/car, preparing tickets. (b) Reasons for a travel folder – To keep track of planned trips, ensure that all documents are in one place. Questions 7 and 8 will be answered in my next lesson. Hope you got all correct. See you next week.