Comparison of Public Limited and Private Limited Companies

This presentation compares the characteristics and differences between public limited companies and private limited companies. It discusses the ownership, purposes, sectors of activity, and key stakeholders of each type of organization. It also examines the effectiveness of these organizations in achieving stakeholder objectives and the responsibilities and strategies adopted by them.

BUSINESS
ORGANIZATION

INTRODUCTION
• Business environment is analysed as all the external and internal
factors that affect how the company functions including employees,
customers, management, supply and demand along with the business
regulations. There are various type of business enterprise operates in
this environment with different aims and purpose behind regulation of
business operations. These business enterprises have their business
operations in different size and scope along with their own ways
raising funds for continuous sustaining in market. In this
presentation, four types different types of organization have been

Cont..
This will entail comparisons between a Public limited
company (Plc.) and a Private limited company (Ltd) in their
footings of their ownership, purposes, and sectors of activity
and key stakeholders. Effectiveness of these organizations
in attaining the objectives of the stakeholders and
responsibilities of enterprise and strategies adopted by
organization to meet those responsibilities.

Private sector
• : From the effective research and study, it has been
recognised that private sector refers to those organisations
whose ownership and operation is controlled by the private
individuals or groups. It can also be considered as those
enterprises who are not able to private their share and
ownership to the public. These business enterprise came in
to existence in the market of UK by getting their funds from
the private individuals, investors, owners capital and
financial institution.

Objectives
• To become most preferred fast food restaurant chain of UK, by
serving high quality products and services.
• Continuously raising profitability by increasing customer base
across the countries.
• Expansion of business operations across the countries.
• Increasing market share by 10% in every quarter as compared to
rivals like Burger king

Vision:
• It is the statement of organisation which reflects their
future desired position in market. In this context,
McDonald's is the fast food restaurant chain that is
operating their business with a vision to continue its top
position in the global fast food chain restaurant market
with more than 36000 locations worldwide, McDonald's
shows resilience and success through continuous
innovation and aggressive marketing. Its success is an
indicator of business effectiveness in attaining objectives.

Mission
• : It is statement of firm that determines its actions to meet
the vision in the future. McDonald's mission is to be their
customer's favourite place and way to eat and drink. Their
global worldwide operations are aligned with the global
strategy called plan to win which focuses on the customer
experience like people. Products place, price and
promotion.

Legal structure
• From the market research, it is identified that firms in private sector operates there
business in different kinds of legal structure like:
• Sole traders: It is considered as simplest form of structure in which there is only single
owner who responsible for regulation and control the business and possess liability of every
business situation either profits and loss. For example: McDonald's have also provided their
outlets to some private owners in different countries in the form of Franchise.
• Partnership: It is also considered as major form of private sector enterprise that posses
two more owners who invests their capital in business with an aim to maximize profits and
high returns. These partnership firms have limited liability as owners share capital and
posses control over business. In UK, presently there are 1.2 million sector firms. McDonald's
outlets in some countries are owned by individuals in partnership with an aim of getting
maximum amount of return.

Public sector
• It has been analysed that the economy of public sector is directly controlled by the
government and government agencies. Large scale business organization which
regulates at international level by having public ownerships. It is clearly identified
as those firms who issues their shares in market to the public for getting
investment and monetary funds used to perform business projects and activities.
Sainsbury is supermarkets is UK's longest retailing food retailing chain, having
opened its first store in 1869. Company is presently in the tertiary and secondary
sector this is because it provides service, sell food and also have their own farms.

Main goals and purpose
• At Sainsbury, they will deliver an continuous improving
quality shopping experience for their customers with the
quality products at fair prices. Their main aim is to
increase the expectation of customers for healthy, safe,
fresh and making their lives easier every day.

Vision and Mission
• Vision: These statements has determined there future
desired position in retail industry of UK. Vision statement
is company is To become as successful market retailer of
food products and increasing customers by satisfying
needs to customers.
• Mission: Mission statements of Sainsbury is to be
consumer's first choice for food and delivering the
products of outstanding quality and effective service at a
competitive cost through working faster, simpler and
together.

Legal structure
• These enterprises operates in structures which are as
follows:
• Franchise: Organizations in public sector also provides these
franchises to other companies in different nations by taking the
amount of royalty for using their brand name and recognition for
regulation of business. Sainsbury have also provided their
franchises to other individuals or organization to increase their
brand recognition as well as sale of products in market.
• Workers cooperative: Those public sector organization in which
the workers also have their ownership in their organisation.
Organization issue its share to their employees in the form of
bonus or getting an investment.

Voluntary
• As per the analysis, activities of the voluntary sector are involved in
different organization like charity, voluntary bodies and business
community. These are organization considered as non for profit or
non governmental organization. These are also considered as
social organisation which aims to resolve the problems of people
like Unemployment, diseases and other problems etc. It has been
noticed that Oxfam is popular voluntary organization in UK. It is
international charitable enterprise that focuses on alleviation of
global property. It is one from several local communities formed in
support of the national famine relief committee

Objectives
• There are several objectives of Oxfam which are
mentioned above:
• To protecting right of people to a sustainable livelihood.
• To avoid and eradicate poverty and powerlessness by promoting
human actions.
• Protecting rights of people to get basic social services.

Vision and Mission
• Vision: Its initial concern was the provision of food to
relieve famine and development of strategies to combat
the causes of Famine. Oxfam also provides tools to enable
the people to become self supporting.
• Mission: Oxfam has its mission to persuade British
government to allow the food relief through the allied
blockade for the starving citizens of occupied Greece.

Legal structure
• Legal structure: Also considered as charitable
organisation which have different legal structures which
are mentioned above:
• Trusts: It is traditional structure of charitable organization which
is governed by the trust deeds content of which is more flexible as
there is no statutory framework.
• Charitable incorporated organization (CIO): It the new legal
structure specially for charitable enterprises like Oxfam and Age
UK. These have similar in some ways to a limited company
offering the protection of trustees from personal liability.

Fire brigade
• Type: It public sector organization that is controlled and operated by
the government of UK. It can also be considered as voluntary service
organization which is established by the government in order to
provide support to the people in UK.
• Size: It is the second-largest of all the fire services in the United
Kingdom, after the national Scottish Fire and Rescue Service and the
fifth-largest in the world, after the Tokyo Fire Department, New York
City Fire Department, Paris Fire Brigade and the Scottish service,
with 5,992 staff, including 5,096 operational firefighters and officers
based at 102 fire stations

Cont.…
• Objectives: LFB also responds to road traffic collisions, floods,
trapped-in-lift releases, and other incidents such as those
involving hazardous materials or major transport accidents
• Structure: Fire Brigade was a branch of the Police Force (thus
fire bobby) and the rank structure was that of police. When the
Fire Service was made independent of the police a new rank
structure and markings was designed for the uniform which
was revamped in 1960’s. Now there are numerous styles used
but the insignia remains constant:

Cont.…
• Purpose: Their main purpose is to provide assistance to
the people and taking their lives
• Stakeholders: it is analyzed that employees will be the
major stakeholders of fire bridge which provides an
impact on their business operations.

P2 Size and Scope of range of different types of
organization.
• Public limited company
• These are the kind of company which are listed on recognised stock exchange and
hence traded publicly. Public companies can invite the general public for subscribing
the shares of the company. Thus these companies are quite renowned. To explain this,
we can take example of Sainsbury company.
• It is second largest chain of supermarkets in United Kingdom . It covers 16.9%
share of the supermarkets in the United Kingdom. It has Sainsbury's Local convenience
store along with the super markets .It also facilitate online shopping services and also
has a property portfolio. It pays emphasis on higher quality grocery to compete with its
rivals. It has 598 supermarkets covering total space of 21,190,000 sq ft., 714
convenience stores covering 1,629,000 sq ft. So we can say that it is a huge company.
•

Private limited
• They are the companied which are held by the individuals privately.
To explain this we can take instance of McDonald .It is a classic food
chain company known for its burger, fries, crisp etc. It has stores in 120
countries and territories serving 68 million customers each day. It has
36899 restaurants worldwide employing more than 375000 people.
• Delicious quality food along with presentation attracts the
customers towards it. Everyone is fond of McDonald burger. It also
provides home delivery. This is most important aspect for the company to
increase its scope by becoming viable to large number of customers.
•

Charity
• They are the organisations which are set-up to raise the funds to help
the people in need.
• Oxfam charity is illustrated as an example for this. It is an international
organisation which emphasise on alleviation of global poverty. It
comprises of 20 N GO'S working with partners in across 90 countries
to reduce the poverty scale.
• It can widen its scope with the help of social workers and other
professionals .Business partners and employees are its main
stakeholders which influence these organisations by investing in them.

Interrelation of different functions of
Sainsbury's with organisation objectives
• It is the largest super chain market of UK and to make the image of company
intact managers has to function in an organised way . They have to work in such
a way so as to achieve the objectives of the organisation. The company is doing
the same by expanding its products from fresh food to packaged grocery such as
tea and sugar by keeping the quality perfect with lower price. It has made its
store look attractive with he help of wooden counters and mosaic floors so that it
grab eyes of most of the customers. Again, the online services made easy for
them to achieve the target .Keeping variety of the products in the store for
example, dairy,bacon and hams, poultry and games, cooked meat etc. makes it
easy for customers to buy everything from one store only. In this way the
managers are making marketing plan and skills to attract more customers . This
way the company is achieving its goal.

Comparison between two different types of businesses
• The regular occupation done by any individual can be done in
many different ways. It may be done privately or can be done by
associating with any government organisation. In broad sense a
business can be classified in two different ways:
• Private Limited:These are the businesses which are held by private
owners only. They are usually a small business organisations. It
requires at least two or more persons for its formation.
• Public Limited:These companies are owned and traded publicly.
This type of organisation requires more persons for its formation.

Cont…
Public limited Private limited
Minimum seven members are required
for its formation.
Minimum two members are required
for it.
Maximum members are unlimited Maximum members are 200
Consists of minimum three directors Consists of minimum two director
Minimum paid up capital is 5 lacs Here minimum paid up capital is 1 lacs
Its suffix is limited Its suffix is private limited
It can starts its business after receiving
certificate of incorporation and
commencement of business.
It can start its business after receiving
certificate of incorporation.
Statutory meeting is compulsion over
here.
It is optional in this.
Issue of prospectus is mandatory. Here it is not required.
Public subscription is allowed. It is not allowed in this
Five members must have to be present
in annual general meeting.
Two members are must for such
businesses.

REFERENCE
• Books and Journals
•
• Haufler, V., 2013. A public role for the private sector: Industry self-regulation in a global economy.
Carnegie Endowment.
• Brinkerhoff, D.W. and Brinkerhoff, J.M., 2011. Public–private partnerships: Perspectives on purposes,
publicness, and good governance. Public Administration and Development. 31(1). pp.2-14.
• Rekart, J., 2011. Public funds, private provision: the role of the voluntary sector. UBC Press.
• Taylor, J., 2010. Public service motivation, civic attitudes and actions of public, nonprofit and private
sector employees. Public Administration. 88(4). pp.1083-1098.
• Buurman, M., Delfgaauw, J., Dur, R. and Van den Bossche, S., 2012. Public sector employees: Risk averse
and altruistic?. Journal of Economic Behavior & Organization. 83(3). pp.279-291.
• Osborne, S.P. and Brown, L. eds., 2013. Handbook of innovation in public services. Edward Elgar
Publishing.