Understanding Business Organization and Its Functions

Understanding Business
Organization

Table of Contents
Introduction......................................................................................................................................3
Main Body......................................................................................................................................3
References........................................................................................................................................7

Introduction
A business organization can be defined as an entity which is engaged in different
commercial, industrial and professional activities with a focus to achieve its objectives. It
involves efforts of individual in order to trade its goods and services for the attaining profits
(Martinez 2019). The report will cover different types of businesses and comparison of
organizational structures. Also, it will include several business functions and its impacts on the
working of company. Further, organizational culture and its positive impacts are briefly
explained in order to understand the benefits of building up an effective culture.
Main Body
a)  Sole trader: It is a type of business which is managed and controlled by one man who is
considered to be the 'owner'. The legal entity of business and owner is not separate from
each other which states that there existence are not going to hamper to each other in any
manner. The advantages and disadvantages of sole trader are explained below:
Advantages Disadvantages
 Complete control of owner on entire
business.
 Acquire the maximum profits as they
are divided.
 Owner can maintain high level of
confidentiality by keeping the
information private.
 Unlimited personal liability of owner.
 Access to limited capital.
 Managerial abilities & skills are
limited.
For example: Small businesses such as, a local grocery store, a local clothes store etc
 Partnership: It is a type of business organization which includes partners who have
agreed to work together with a mutual interest (Maloni, Hiatt and Campbell, 2019). This
includes the relationship between different persons who are in a agreement to share the