Understanding Business Organisation Essay

Understanding Business
Organisation Essay
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INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
“Understanding business organisations and their environments”..........................................3
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6
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INTRODUCTION
In order to be successful in an industry it is essential for an individual to understand
different types of business organisation and their structure along the manner in which they
perform their roles and responsibility to accomplish objectives (Gošnik and Kavčič, 2021). It
essential to have systematic organisational structure as with the understanding of this
accomplishment of overall objective can be done in an effective manner. Present report is
inclusive of the discussion on sole trader, partnership and limited company along with their
advantages and disadvantages. In addition to this different business functions along with their
impact on organisation and people within organisations is also discussed in this essay.
Furthermore essay include discussion on organisational culture and the manner in which positive
culture impact upon organisation success.
MAIN BODY
“Understanding business organisations and their environments”
Sole trader or sole proprietor is mainly defined as an unincorporated business which is
owned and managed by a single individual. In this individual is responsible to pay personal
income taxes and known as individual entrepreneur or sole trader. The main advantage is of sole
trader is that they are responsible for all the profit earned by the entity. Along with this they are
not obliged to pay taxes and have benefit in terms of low start-up cost. While disadvantages of
sole trader include unlimited liability, responsibility to make day to day decisions and difficulties
in raising capital. Partnership is mainly defined as a state of being a partner or partners a
partnership is mainly defined as system in which business partners are agreed to co-operate for
mutual interest. In this partnership in a partnership agreement can be interest based organisation,
individual businesses extra. The main advantages of partnership is that it allow to start a business
with someone else without having any certain form of formalities. Along with this there is few
legal formality and it is easy to establish. While main disadvantages of partnership is start in this
there is uncertainty in which partnership business suffer from in stability. Along with this it has
been identified that every partner is liable for the share of partnership (Kumar and Afreen, 2021).
Along with this partnership disagreement is also the major disadvantage. Limited company is
mainly defined as a privately owned organisation in which owners are duly legally responsible
for their taxes only to the extent of the amount of capital which they have invested. Furthermore,
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