Business in Practice: Types of Businesses, Organizational Structure, and External Analysis

This document provides an in-depth analysis of different types of businesses, including micro, small, and large businesses, as well as sole trader, partnership, limited liability, and cooperation. It also explores various types of organizational structures and the impact of external factors on businesses. The document concludes with a discussion on the aftermath of post-Brexit economy and its effects on Sainsbury, a London-based supermarket chain.

Business in practice

Table of Contents
INTRODUCTION...........................................................................................................................3
Section 1...........................................................................................................................................3
Definition and characteristics of micro, small and large businesses......................................3
Section 2...........................................................................................................................................4
Definition and characteristics of sole trader, partnership, limited liability and cooperation. 4
Section 3...........................................................................................................................................5
Different types of organizational structure.............................................................................5
External Analysis....................................................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
It is an activity or a tactic a business conduct to target its objectives and goals.
These are the practices that can attempt to do within a cost effective way as a firm may
have several rules regarding its business practice to assure that its workers are
productive within their work and obey applicable laws. Present Report focuses on
Different types of organizational structure, External analysis of firm and definition of
Sole proprietorship, Partnership, Limited liability firm, Cooperation (Kim,. and Lee,
2016)
Section 1
Definition and characteristics of micro, small and large businesses
Micro-enterprises- It focuses on small business employees of 10 people employees or
less than that. It is a firm where investment within machinery and plants are operated
with the help of small amount. These can works as well as operating not for choice but
for the needs.
Small – Here there are employing around 50 employees or less. These are the
enterprises which works as well as operates so that they can earn around small profit. It
generates revenue that are lower than larger scale. The maximum revenue set is
around $ 21.6 million per year. As mention above it has smaller number of employees
as compare to firm to the larger scale employees. These business can entirely run
through small teams or single individuals. A larger small scale also employing fewer
than 100 staff members relied on the type of business. These are the firms that are only
founded within specified areas as these firms are unable to have sales outlet within
multiple nations (Labes, Hanner, and Zarnekow, , 2017)
Medium- They are the one who refers to a business employees of around 250
maximum employees. Here the enterprises works as well as operates to earn a fair
amount of profit to enhance their living of standard. As medium-sized firm has a simple
type of business structure as it allows firms to be very flexible as well as make crucial
changes rapidly. It can be an advantage as a medium scale when it comes to about
filling niche market and specialization with products.

Thus, size can be disadvantages as limited funds are also very effects marketing as
well as capacity to target new markets along with their goods be assured of the
limitations of budget. Medium scale firms focuses on small amount of product as well as
services as here firms establishes strong relationship with their business partners. Here
there were typical makes crucial changes to its services and product so that it can
match the needs of clients but at the same time its downside is it depends heavily on
current partnership and if the relationship is terminated than they suffers financially.
Large scale entrepreneurship- They can have definite cycles as well as grow through
sustaining innovation and at the same time offers new core and innovative products.
They have around more than 1000 employees. They have medium risk because they
can manage of sell high volume due to their brand (Mahmood, Chung, and Mitchell,
2017).
Section 2
Definition and characteristics of sole trader, partnership, limited liability and cooperation
It is a legal entity that gives several products as well as services as it can follow
various rules as well as regulations. There are several types of business that exists
within a country . The size and structure of the business relied on its type. They are
described as mention below.
Sole proprietorship- Within such business is owned through a single owner as the
person is accountable for management of the whole business as well as taking
decisions. The whole profit can be earned is received through owner. It is very easy to
set up legally such kind of business as there were unlimited liabilities within it. In
addition to this, it is easy as well as cost effective for setting up business.
Partnership- Within this there is agreement done on the basis of partnership act as
there are two or more than two people involved within a business. In addition to this
agreement is also written regarding how the decision are successfully made as well as
profit is also shared and many more. Alongside, profit is also shared on the agreement
basis (Oliva, and Singh, , 2019).
Private company- Here the business can be started through group of people who
have common objectives as it is also having legal existence. Here the firm is also
registered by share of stocks as well as stake holder's liability is one the limited basis.

Thus, to form goals as well as objectives stakeholder elect BOD ,also these types of
firms are not dissolved when there is a change within ownership.
Limited liability firm- Within this type of business firm is having feature of both
company and partnership as it is not incorporated as there is a limited liability of the
owner. It can be either a partnership or a sole proprietorship.
Cooperative – it is a business that has minimum amount of five members as all of them
having equal right regarding voting regardless of their level of investment. All the
included members are expected to assists to run . It also enables a limited distribution
of profits to its members as it is one that boosts a democratic style that promotes
concepts regarding delegation and sharing resources to enhance competitiveness
(Pan, Chen, and Zhan, 2019).
Section 3
Different types of organizational structure
Firms are set up within particular way to accomplish various goals and objectives
of an organization. Firms can achieve higher sales as well as other profits through the
structure they can use to operate. There are three basic types of firms
Functional – Here within this function each portion of the firm is grouped as per their
purpose such as sales department, marketing department and many more. It can works
very well with small businesses as they can based on knowledge and talent of its
employees but here one of the drawback is that the coordination between the
departments can be limited through boundaries of organization as each department
works separately.
Divisional structure- it is used within large firms that operate within a broad
geographical areas or to separate smaller firms to cover various types of products
areas. Here each department's requirements can be met more specifically and rapidly
as each department is more or less dependent for other division within firm. It is one of
the costly structure regarding its scope and size (Ritchi, Jans, and Reijers, 2020).
Matrix structure- It is the third type of organizational structure known as the matrix
structure is a functional and hybrid structure. Basically used within large MNCs ,as it
enables to create a power struggles due to several areas of the firm that have a dual
management.

External Analysis
Pestle of Sainsbury
Firm is active since 1896 as it a London based supermarket. It is known as the
longest supermarket chain within nation as well as currently known as United Kingdom's
largest stores over 1500's stores. Firm has also facing lots of competition from its
competitors. Mention below is the detailed version of the Pestle analysis of Sainsbury.
Political Conditions
It is one of the biggest factor that impact the Sainsbury situation as due to Brexit it
impacts a lot ,it means that England will not the part of European Union and it leads to
enhance the imports rates. Without any doubt it will enhance the price of products as
now the specified impacts regarding Brexit unable to measure but at the same time it
also leads to adverse impacts for the Sainsbury brand (Song, Sun, and Jin, 2017).
Economic conditions
Within Europe Sainsbury is highly relied on the road-based transport that focuses that if
the rapid increase of both diesel and petrol bounds Sainsbury to increase the price of
its products. In future loss of fossil also leads Sainsbury to pick the alternative means of
transport. Also the expectations of the higher salary of the consumers are also one of
the biggest economic factor that impacts Sainsbury. The movement of the higher wage
also provides a gaining momentum all over the nation as well as Sainsbury can meet
the requirements of its employees so that shareholder can be retain.
There are various other factor such as rise of supermarket chain all over the
United Kingdom also becomes one of the strong economic factor that can also deal by
Sainsbury. Other brands such as Tesco and Asda have been also rivalries of the firm as
well as also leads to increase of the new one such as Aldi and Lidl that can added
competition within the marketplace (Song, , 2016).
Social factors- Nowadays people are more conscious regarding their health as
Population of the United kingdom does not includes fast food items within their diet. So
Sainsbury needs to be change their fast food menu in order to stay relevant within the
climate of the socio-cultural for example organic shakes and salads. Also people are
cutting sugar from their diets so Sainsbury also assures that they provides consumers
sugar free chocolates and other items to meet the requirements of the consumer.

Technological- The e-commerce store of Sainsbury is helpful towards the consumer by
providing a better experience as if Sainsbury uses the latest brand data analytical
system such as AI and big data can able to understand the demographic requirements
of the costumers. By the help of such methods to can gain sales as well as used for the
better marketing campaigns.
Online shopping- Like other supermarkets of UK Sainsbury also provides online
shopping as consumers can offers the groceries firm their home
Legal factors- Brands like Sainsbury have various layers of the decision-making as
rapidly changing the needs of the consumer base of the firm also require to be in toes
so that the consumer demands will be fulfilled. Any delay within regulatory approval
leads to loss within market shares as well as it provides a chance to the rivalries to
provide better experience to consumers. Aftermath of post Brexit economy also
becomes one of the major factor that lead to changes the polices of Sainsbury (Kim,.
and Lee, 2016).
Environmental factors- Firms like Sainsbury that is a supermarket chain of UK have
produces a high level of carbon footprint that ca be adversely impact negatively to the
environmental condition. As within current climate the firm needs to assure to take
active steps that check its impact of the environment. It also focuses to reduces the use
of the plastic waste as well as reduce the fossil fuels based transportation methods and
many more.
CONCLUSION
From the above it had been concluded that due to Brexit leads to enhance the
imports rates also leads to adverse impacts for the Sainsbury brand. Sainsbury relied
on the road-based transport that focuses that if the rapid increase of both diesel and
petrol one of the biggest economic factor that impacts firm within a negative way.
people are cutting sugar from their diets so Sainsbury also assures that they provides
consumers sugar free chocolates and other items to meet the requirements of the
consumer. AI and big data can understand the demographic requirements for the better
marketing campaigns. It also focused on Micro, Small, Medium, Large scale
entrepreneurship. It also focused Sole proprietorship where business is owned through
a single owner. Partnership done on the basis of partnership act as there are two or

more than two people involved within a business. Cooperative has minimum amount of
five members as all of them having equal right regarding voting promotes concepts
regarding delegation.

REFERENCES
Books and journals
Kim, Y.I. and Lee, B., 2016. Comparison of occupational health providers' perception on
workers' health promotion program by business types: Focusing on need,
necessity, performance, barriers, and effectiveness of program. Korean Journal
of Occupational Health Nursing, 25(1), pp.29-40.
Labes, S., Hanner, N. and Zarnekow, R., 2017. Successful business model types of
cloud providers. Business & Information Systems Engineering, 59(4), pp.223-
233.
Mahmood, I., Chung, C.N. and Mitchell, W., 2017. Political connections and business
strategy in dynamic environments: How types and destinations of political ties
affect business diversification in closed and open political economic
contexts. Global Strategy Journal, 7(4), pp.375-399.
Oliva, F.L., and Singh, S.K., 2019. Innovation in the main Brazilian business sectors:
characteristics, types and comparison of innovation. Journal of Knowledge
Management.
Pan, W., Chen, L. and Zhan, W., 2019. PESTEL analysis of construction productivity
enhancement strategies: A case study of three economies. Journal of
Management in Engineering, 35(1), p.05018013.
Ritchi, H., Jans, M. and Reijers, H.A., 2020. The influence of business process
representation on performance of different task types. Journal of Information
Systems, 34(1), pp.167-194.
Song, J., Sun, Y. and Jin, L., 2017. PESTEL analysis of the development of the waste-
to-energy incineration industry in China. Renewable and Sustainable Energy
Reviews, 80, pp.276-289.
Song, M., 2016. A study on business types of IoT-based smarthome: Based on the
theory of platform typology. The Journal of The Institute of Internet,
Broadcasting and Communication, 16(2), pp.27-40.