Advantages and Disadvantages of Business Enterprises and Organizational Structures in Hospitality Industry

This essay discusses the advantages and disadvantages of business enterprises and organizational structures in the hospitality industry. It covers topics such as sole traders, partnerships, limited companies, tall and flat structures, business functions, and organizational culture.

Essay

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Business enterprises advantages and disadvantages:...................................................................3
Compare and contrast the tall and flat structures:........................................................................5
Business functions: .....................................................................................................................5
Organization culture:...................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................1

INTRODUCTION
Business organization is referred as the purpose of carrying the enterprises of
commercial. Business enterprises are considered the three forms which include the partnership,
sole traders and limited companies. This report will discuss the advantages and disadvantages of
the business enterprises with the examples in order to hospitality and tourism industry as well as
flat and tall structure of the organization. This report will also elaborate the functions of the
human resource management and organization culture with the example of company.
MAIN BODY
Business enterprises advantages and disadvantages:
Sole trader:
The sole trader is the business in which individual person can run as well as own the
entire business. It is also known as the sole proprietorship. It is referred as the legal structure of
the business and this business is registered under the sole traders and it only consists the owner
as well as additional employees (Abdulaali, 2018). In this business capital also require the
minimum and the size of the business is small.
The advantages of the sole proprietorship
 start-up cost are low: the start-up cost of the business will be low in the sole trader
business and it is interdependent on the owner of the company.
 Maximum privacy: privacy of company is maximum in the organization as well as no
fraud will do.
 Boss: the owner is the boss of the company and no restrictions on the company owners.
Disadvantages of sole traders
 liability: the liability of the company is limited for debts.
 Raise capital: the capability of raise capital for the business is also limited in the sole
trader structure (Alves and Feitosa, 2020).
 No holiday: it hard for the owner of the business to take holidays. Example: Mogford
company is the tourism company which is started by the owner Jeremy Mogford.
Partnership:

In the partnership, the business are run and operate by the two or more persons as well as
share their profits and liabilities.
Advantages:
 Sharing the burden: In the partnership, the burdens and stress are share between the
partners as compared to sole traders.
 Better decision-making: the making decision for the business will be effective and
efficient as well as better because every business partners gives their business ideas.
 More capital: If the partners are more than the capital will be more and it will help in
grow the business.
Disadvantages:
 Liability: The liability is limited in the partnership. The partners are liable for the losses
incurred and debts.
 Conflicts: The conflicts are occurred between the partners if they are not agreed on the
one point.
 Profits shared: profits are shared between the partners equally and they are under the
agreements about the sharing profits between them (Aws and Ping, 2021). Example the
Hamilton hotel company is the partnership company in the United Kingdom.
Limited company:
Limited company is the popular legal structure for all types of business in the United
kingdom. Example: there are various limited hospitality company in the UK. For example the
Ritz limited company is the top hospitality company in the UK.
Advantages:
 personal liability: The personal liability is minimum in the limited company because the
limited company is treated as the separate legal entity.
 Tax efficiency: The limited company is offer the flexibility in the taxes planning as
compared as sole trader and partnership company. The sole traders are pay the 20-45%
tax of income on their profits.
 Remuneration: the personal remuneration is high in the limited company by reducing
the income tax as well as national insurance contribution with the help of flexibility in the
tax.
Disadvantages:

 Records: the company registers and its records must be maintain as well as available for
the public to inspect about the registered company under the private limited.
 Restrictions: The company name must be subject to the certain restriction of limited
company.
 Incorporated: the limited companies are incorporated the house of companies.
Compare and contrast the tall and flat structures:
Tall structure of the organization is the structure with the may types of hierarchy, while
the flat structure of organization is structure with the limited number of hierarchy. The tall
structure is also known as the traditional structure of the company where as the flat structure is
also known as the orgiastic structure. The flat structure is flexible alternative to tall structure. It
also suitable to adopt and helps in gaining the fast popularity. But the tall structure is equipped
with the narrow span of control and it helps in manage the structure in the effective manner. The
landmark London hospitality is the tall structure organization. The Hilton is the flat structure
organization structure in the hospitality industry (Clement, 2019). The Landmark company have
small number of staff and subordinates and the communication path is long in the tall structure.
In the flat structure, the Hilton company have more control and more subordinates but the
communication path is short in the result of efficient communication. The flat structure
organization helps in employees to fell more motivated with the help of productive, but it results
in the higher work load, lack of opportunity as well as require more subordinates. Furthermore,
in the tall structure organization have growth opportunities but the employees are demotivated
and changes in the organization are slowly implement.
Business functions:
There are various business functions which are carried by and enterprise. The business
function are important activities which are needed in the business for operate business efficiently
and effectively.
 Human resources management: the human resources management is responsible for
the labour matters so, the organization need to access the labour and workers needs,
organization must create the job descriptions for the workers in the business, recruits the
staff and fill the vacancies in the organization and make organization more efficient and
profitable, arrange the training for the employees that can helps in motivate them and

influence towards the business. The HR management responsible for pay the salary and
wages to employees (Nastase, 2019). Example: In the Premier Inn hospitality companies
staffs are most needed for the managing the works in the hospitality so, HR management
need to focus on the Workers as well as organization.
 Production: the production function in the business activities is refer as the products and
services which are delivered by the company to the consumers in the market. In the
production functions company must make sure that the quality of products and services
are provide in good quality (Macchi and Savino, 2020). The production function are
responsible for the Premier Inn company that they deliver the good quality of goods and
services, meet the customers demands as well as their perceptions and fulfil the
expectations of the customers and satisfy the customers.
 Operations: in the business function, the operation not involves the equipments of the
business. The operation is depend on the create products and services as well as deliver to
the customers. Mostly people are operate the business operations, such as managers,
employees, etc. it is more beneficial for improving the performance of organization, if it
is operate in the effective and efficient manner (Huang, 2021). The operation function
helps Premier Inn company to improve the operations in the business organization.
Organization culture:
The organisational culture is refer as the attitudes, beliefs, values and behaviours that
contribute and characterized in the work environment of business. It is also known as the
corporate cultures. The corporate culture is unique from the other culture of the organization. It
differ the organization from the others. The culture of the Premier Inn are good in the market.
The organizational culture can helps in built the business reputation as well as enhance the
employees engagements, productivity of the business, increase the customers retention rate as
well as employee retention (Lubis and Hanum, 2020). It also helps in develop the happiness in
the organization that helps in achieve the good reputation and goodwill in competitive
marketplace. In Addition, the Premier Inn company accomplish their goals and targets as well as
achieve the success in market.
 Characteristic of people: the organizational cultural is define the behaviour of the
organization managers, employees, board member's, etc. the leader of the organization is

responsible for the organizational culture. For example: in the Premier Inn company, the
leader is maintain the proper behaviour in the organization and the employees and
workers are follow the leaders paths and it helps in maintain the culture in the
organization, so the company have good organizational cultures.
 Organizational ethics: in the organizational culture, the ethic of he organization are also
refer the external and internal environments of the business. The business ethics refer the
cultural of the organization that determines the safety and care of employees as well as
customers (Azeem, 2021). The Premier Inn company also maintain the safety and care
for the employees and customers as well as the are prefer the customers first. The
company also follow the different beliefs according to different societies and it helps in
attract the more customers as well as retain the customers. The organization culture of the
Premier Inn helps in achieve and attain the more customers in the competitive market.
CONCLUSION
As the conclusion, business organization the have various forms that business adopts and
affects company tax, legal liability,costa of formation and operational cost. In this report the
discussed the various business organization such as sole traders, partnership and limited
company as well s discussed the tall and flat structure of organization with the hospitality
industry. In the conclusion, the report also discussed the business functions such as production,
operational, and human resources management with the example of Premier Inn company as
well as their organizational culture for the success and better reputation of the company.

REFERENCES
Books and journals
Abdulaali, A.R., 2018. The impact of intellectual capital on business organization. Academy of
Accounting and Financial Studies Journal. 22(6). pp.1-16.
Alves, E.C. and Feitosa, L.A., 2020. Analysis of the global tall buildings stability in flat slabs
considering the soil structure interaction. Revista IBRACON de Estruturas e
Materiais. 13(1). pp.183-199.
Aws, A.L., Ping, T.A. and Al-Okaily, M., 2021. Towards business intelligence success
measurement in an organization: a conceptual study. Journal of System and
Management Sciences. 11(2). pp.155-170.
Azeem, M., and et.al., 2021. Expanding competitive advantage through organizational culture,
knowledge sharing and organizational innovation. Technology in Society. 66.p.101635.
Clement, F.H., 2019. Tall or Flat? Examining The Relationship Between Organizational
Structure and Turnover Intention (Doctoral dissertation, Azusa Pacific University).
Huang, A., and et.al., 2021. When artificial intelligence meets the hospitality and tourism
industry: an assessment framework to inform theory and management. Journal of
Hospitality and Tourism Insights.
Lubis, F.R. and Hanum, F., 2020, December. Organizational culture. In 2nd Yogyakarta
international conference on educational management/administration and pedagogy
(YICEMAP 2019). Atlantis Press (pp. 88-91).
Macchi, M., Savino, M. and Roda, I., 2020. Analysing the support of sustainability within the
manufacturing strategy through multiple perspectives of different business
functions. Journal of Cleaner Production. 258.p.120771.
Nastase, M., and et.al., 2019. The specific elements of strategic human resources management
for competitive business development. Industria Textila. 70(6).pp.579-586.
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