Business in Practice: Criteria for Classifying Businesses and Characteristics of Different Types of Businesses

This article discusses the criteria for classifying different types of businesses, including micro, small, medium, and large businesses. It also covers the characteristics of sole trader, partnership, private limited liability, public limited liability, and cooperative businesses. Examples are provided throughout the article. Course code, course name, and college/university are not mentioned.

Business in Practice

Table of Contents
MAIN BODY...................................................................................................................................1
1. Discuss the main criteria used for classifying different kind of businesses?..........................1
2. Explain micro business with appropriate examples. ..............................................................1
3. Explain small business with appropriate examples.................................................................1
4. Explain medium size business with appropriate examples. ...................................................1
5. Explain large size business with appropriate examples. .......................................................2
TASK 2............................................................................................................................................2
1. Define sole trader business with appropriate examples. Briefly explain three main
characteristics of a sole trader business? ....................................................................................2
2. Define partnership with appropriate examples. Briefly explain three main characteristics of
a partnership business?................................................................................................................2
3. Define private limited liability business with appropriate examples. Briefly explain three
main characteristics of a private limited liability business?........................................................3
4. Define public limited liability business with appropriate examples. Briefly explain three
main characteristics of a public limited liability business?.........................................................3
5. Define cooperative with appropriate examples. Briefly explain three main characteristics of
a cooperative. .............................................................................................................................3
References:.......................................................................................................................................3

MAIN BODY
1. Discuss the main criteria used for classifying different kind of businesses?
Owner can classifies the businesses into three basic categories, that are as retailer and
manufacturing and many others. Due to this, companies may gives various services and
goods to their users and services industry. Just as restaurants are manufacturing and service
companies, they make meals and serve all them to the guest. Some of companies are retailer
companies as they provides goods and services as per the needs and wants of the buyers
(Ogbechie, 2018. ).
2. Explain micro business with appropriate examples.
It refers to the micro business which starts with a little amount of capital plus
workers a small number of people . Basically these enterprises serves as a trademark of
improving the nation as well as its economy. Various people search a shortage of occupation
in the formal sector. Thus, it assist them to find a good occupation in a wanted section. The
main focus of this kind of concern is to bringing backward classes into the plan for country
improvement . They objects to support regional improvement. These kinds of businesses are
as small retailers, computer services and many others.
3. Explain small business with appropriate examples.
Small business are either services and retail just as grocery stores, medical stores and
tradespeople , bakers and many others. These kind of enterprises are usually suited to action
on a small scale to offer a local community and to give incomes to the business directors.
These kinds of businesses are as small scale manufacturing industry, hand looms and power
loom etc. these types of industry are majorly labour intensive (Moellers, Visini and
Haldimann, 2020). Different kinds of small business is more included of physical operations
rather than intellectual activity.
4. Explain medium size business with appropriate examples.
Medium size businesses are the legal structure that majorly contributes in business
economy. These companies exist across industries and sectors occupying as least as 10 and
many workers. These restrictions vary among nations with professional and governing
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agencies analysing the investors in each nations and areas. These kinds of industries are
accommodation and food services, retail trade and construction. These kinds of businesses
always comes up with the new innovations and technologies.
5. Explain large size business with appropriate examples.
It is refers to the multinational companies where huge amount of employees work and
serve services across the home region. As the governing bodies or country norms they all
have minimum 100 employees. They have improved access to capital as they access to
various sources of finance just as offering debentures ,sale of shares to the basic public on
the inventory exchange or access to long term loans. It is also easier to grow capital at less
interest charges as big business borrowing . The director of these business have to carry a huge
burden of regular responsibility . It is due to huge business can afford to workers specialist
professional managers are more familiar with the company (Jasni and et., al., 2019).
TASK 2
1. Define sole trader business with appropriate examples. Briefly explain three main
characteristics of a sole trader business?
It is the old kind of business which is owned by an individual person as of they have to
invest a huge amount in order to start a company. All profit is managed by the company owner
alone along with that risk is also bear by the owner itself. The business majorly depends on the
resources as the company is basically on a small scale basis. The company is mainly run with
the assistance of family members and they have hire an employees to look out on the regular
activity. Example of this company is finance company and many others. It characteristics are
as –
 The whole profit is managed by the director only.
 All decision making powers are in the hands of an owner.
2. Define partnership with appropriate examples. Briefly explain three main characteristics of a
partnership business?
This kind of business is created by two or more members by investing a huge amount
also they equally invest the capital in order to start a business (Anlesinya and Abugre 2021).
These can be a cafe ,restaurant anything. The characteristics of the company are as-
 The decision making power are in the hands of all partners.
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 Profits are shared among the partners equally either the profit sharing ratio .
3. Define private limited liability business with appropriate examples. Briefly explain three main
characteristics of a private limited liability business?
In this type of company shareholders cannot trade public equity. It restricts its amount
of equity to 50. investors cannot sell their equity without the approval of another equity
holders. It is company which limits the right of its members to transfer its capital. It
characteristics are as -
 In order to start a company at least 2 members are required .
 For this company it is compulsory to mention pvt ltd after the company name.
4. Define public limited liability business with appropriate examples. Briefly explain three main
characteristics of a public limited liability business?
It is a company with limited liability and serves shares to the basic people. Moreover
the shares of public limited company can be accessed by anyone via business. The
minimum paid up capital of these company is 500000. here are some characteristics of the
company are as -
 company is a legal entity has separate identity from its investors members.
 The company can never come to the end. It continues till he company is not closed.
5. Define cooperative with appropriate examples. Briefly explain three main characteristics of a
cooperative.
They are organised as an inoperative business formed by the people who wish to give
and jointly own their housing . The groups in a housing cooperative and cannot be sold for
wealth. These enterprises serves the requirements of their members. Here are some features
of this company which Is listed in below -
 These kinds of company are open and voluntary association
 They have a democratic structure with each members having one vote (Thoene and
Turriago-Hoyos, 2019).
References:
Books and Journals
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Anlesinya, A. and Abugre, J.B., 2021. Strategic CSR practices, strategic orientation and business
value creation among multinational subsidiaries in Ghana. Society and Business Review.
Jasni, N.S., and et., al., 2019. Business strategy for environmental social governance practices:
evidence from telecommunication companies in Malaysia. Social Responsibility
Journal.
Moellers, T., Visini, C. and Haldimann, M., 2020. Complementing open innovation in multi‐
business firms: practices for promoting knowledge flows across internal units. R&D
Management, 50(1), pp.96-115.
Ogbechie, C., 2018. Strategic Management Practices in Africa. In Indigenous Management
Practices in Africa. Emerald Publishing Limited.
Thoene, U. and Turriago-Hoyos, A., 2019. Trust, business, and society in a post-conflict
scenario-the case of managing workplace practices in Colombia. International Journal
of Business and Globalisation, 23(2), pp.232-249.
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