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Business and Business Environment : Merrill Lynch investment

   

Added on  2021-02-20

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Business and businessenvironment
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INTRODUCTIONBusiness environment refers to all the internal as well as external factors that mayinfluence an enterprise. It includes both macro and micro environmental attributes whichcontribute to the development of a business. These are affected by a number of other factorsincluding global, technological, social, political, demographic, competitive etc. For the followingreport, Merrill Lynch investment company has been selected which is one of the leading andrespected firms in UK. The company provides variety of services ranging from commercial,investment banking, financial products etc. Also, a private enterprise has been chosen i.e. UnitedBiscuits whose headquarters are in London, UK and was founded in 1948 which is a prospectclient of Merrill Lynch. It deals in manufacturing of sweet and salty biscuits (Bennett, 2014). This report highlights on different types of organisations like sole trader, partnership etc.and covers micro & macro environmental factors like PESTLE, SWOT in order to achieveorganisational goals and objectives. Also various sectors like primary, secondary, tertiary arealso included under the following report. TASK 1P1 Different types and purpose of organisations:An organisation is a legal structure which comprise of different people that arecategorised under top, middle, bottom level management. Generally, it is a place where group ofindividuals come for a common goal to meet organisational objectives. This can be formedaccording to the need of partners, for example, sole trader, partnership, private limited company,co-operative society etc.The purpose of an organisation is to help the employees understand the direction of activitiesperformed and to serve and satisfy the customers. An organisation can be divided into differentsectors which include primary, secondary & tertiary (Botha, Kourie and Snyman, 2014). Sole trader: A sole proprietor or trader is an individual or entrepreneur which is ownedand run by a single person. All the activities are performed by the individual and is responsiblefor any gain or loss which may arise during business operations. One of the advantage of thisstructure is that the sole trader has full control over decision-making, strategy implication or anyexpenditure incurred. However, the drawback is that in case of huge losses, the proprietor is1
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liable for any debts incurred in the business. For example, Oaks Auditors and Tax Advisors is asingle entrepreneurship business set up in UK (Pounder, 2015). No legal organisational structure is followed by the company as it is a sole proprietorshipfirm. The main objective of Oaks Auditors and Tax Advisors is to provide reliable services to thecustomers and generate high profit margins for the business. Partnership: It is an agreement where two or more individuals form a company andshare all the profit & losses, responsibilities etc. Every person involved is fully liable for anydebts built up during the course of action. One of the major advantage for this structure is that allthe risk & rewards are shared equally according to the capital invested by partners. Thedisadvantage is that each individual is liable for the decisions made by another. For example,John Lewis is a partnership firm which offers different products & services to the users and is setup in London, UK (Sekaran and Bougie, 2016). The company is a partnership firm which follows a team-based organisational structurewhere people work towards a common goal or objective for the welfare of the organisation(Organisational structure of John Lewis Partnership, 2018). The major objective of John Lewisis to work together towards a common goal or target which is to be achieved during the businessprocess. Limited company (Private organisation): It is a company where obligation of eachindividual involved is restricted to the capital invested in the organisation (Cairncross, 2014).They may be limited by shares or guarantee and comprises of a structure including both publicand private limited firms. The legal responsibility of directors in a limited company is to submitannual reports every year with detailed statements like balance sheet, P&L, CFS etc. The majoradvantage of this structure is its own legal identity unlike a sole trader and drawback is that itbecomes more challenging to raise capital and acquire loans. For example, United Biscuits is alimited company which operates in UK. The company follows a divisional structure where each functional unit has its owndivision in which business activities are performed. The main objective of United Biscuits is tooffer different types of biscuits to the users by charging a low price in order to achieve highprofit margin (Shenkar, Luo and Chi, 2014). Public limited company (Private organisation): It is a company whose shares can befreely sold and traded among the market participants. It must have at least two shareholders,2
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