Understanding Different Types of Companies and External Factors Affecting Businesses

This report provides an understanding of different types of companies and how they work, as well as the impact of external factors on businesses. It focuses on Cadbury as a case study.

Individual report
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Table of Contents
Table of Contents.............................................................................................................................3
INTRODUCTION...........................................................................................................................4
Section 1: You are to show an understanding of the different types of companies and how they
work.............................................................................................................................................4
Section 2: You are required to explain different companies from sole traders to cooperatives
and Limited Liability Partnerships..............................................................................................5
Section 3: To consider different business structures and how external factors affect businesses.
.....................................................................................................................................................5
CONCLUSION................................................................................................................................8
REFERENCE..................................................................................................................................9
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INTRODUCTION
Business report is the evaluation of activities and functions which are running in the industry
that needs to consider while operation which can help to increase the organisational productivity
and profitability (Amir, Arshid and Arani, 2019). For running any business there is need to
analyse the activities and productivity as these are important to know that which factors might be
affect the business and their performance. This report is based on Cadbury organisation that is
large size multinational company operating their business all over the country by offering variety
of products and services which influences number of customers and attain the higher
productivity. The management of such organisation understand taste of their customers produce
the kind of products which develop the higher performance in changing environment. This report
is segmented in three section as different types of business, types of companies and factors in
relation to external environment that affected the business.
Section 1: You are to show an understanding of the different types of companies and how they
work.
Micro business: This type of businesses is very small in size as they are operating very
small places. The main purpose of such business is to fill customers demand and live their daily
life. In this business numbers of people are less than 5 that can help to manage a business. For
example, repairing shop, mobile booth (Ghobakhloo, Azar and Tang, 2019).
Small business: This specify explicit as small business such as sole trader, partnership
and corporation which can help to manage a business regularly. The main purpose of small
business is to manage the activities and fill the customer demand and increases the performance.
the number of person in such business are less than 10 who thoughts to increase their activities.
For example, small restaurant, Café Qila and others.
Medium size business: Such type explicit greater than small where more than 50 but less
than 250 employees are working for the purpose of providing variety of products and services.
For instance, Pharmacy 2U, Crawford Healthcare, NPW gifts (Ye, Xiao and Zhou, 2019).
Large size business: This type of business is establishing for getting the higher profits by
managing and organising all activities accurately. The number of employees are more than 500
that helps to attracts the large number of customers. For example, Cadbury, Starbucks and Rolls
Royce.
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Section 2: You are required to explain different companies from sole traders to cooperatives and
Limited Liability Partnerships
Sole trader business: When a business is operating by single person by taking all risk and
potential which can help to operate a business If any losses arises then such person is liable to
manage the business and develop all activities (Anwar and Ali Shah, 2020).
Partnership: When a business is operating by two and more than two people in the interest
of getting higher profits and developing a business activities. The partners are legally responsible
who use the partnership deed in distributing profits and loss effectively.
Limited liability business: This means a business where people are engaging in business
activities up to a limited liability which can help to operate and regulate a business continuously.
This can be in the form of public organisation, trust and charities where members are legally
(Dong and Yang, 2020).
Public limited liability business: This means public limited liability company that signifies
business offers shares to the public. This business is operating by public and government
authorities which can help to develop a business efficiently. For arranging the funds and capital
there is need to sale shares publically that can help to operate a business regularly and manage
the business effectively.
Cooperative: A business in the form of cooperation, farm, and business that mainly owned
by different people for the purpose of organizing all activities and development of business
properly. This is uses to analyse the needs and provide the better quality of products and services
(Mawuli and Yala, 2019).
Section 3: To consider different business structures and how external factors affect businesses.
Organisation structure is defined as design and practices of business which uses to manage
all activities and perform the organizational functional in effective form that helps to manage the
business and attain the higher profitability (Vita, 2019). Cadbury is large size organization which
is operating business by adopting best structure that are as explained:
Matrix Structure: This type of organisation structure is designed to establish good
relationship in organisation that can help to manage the all activities and functions accurately. In
this, same skills of people are pooled for getting work assignment where they needs to report
more than one manager that might be create the burden on workers. For example, in case of
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adopting this culture by Cadbury, management is assigning all activities and delivering the giood
performance in effective manner (Oliva and et.al., 2019).
Line Organizational structure – This is simple company structure which uses by
organization to manage and organize the business activities. in this flow of information and
authorities keeps top to bottom that can help employees to work accordingly and increase the
organisational productivity. in case of adopting this culture by Cadbury chain of command and
each department head has control over their departments that supports to complete assignment
and manage the functions (Tura, Keränen and Patala, 2019).
From the above Cadbury is focusing and following the Line organisational structure in
which management provide the information to employees in a line form that helps to complete
the work and develop the business effectively in changing environment. The management also
operate and organise the business activities accurately so that a it can be grow by brining stability
and effective communication.
PESTLE Analysis: The research of PESTLE is an appropriate platform for the analysis
and monitoring of macro-environment conditions and their variables that may have an effect on
industry. Both businesses use the system to examine the effect of financial influences on policies
and industry in the current period. This includes a few factors addressed with Cadbury Company
in terms of relevance:
Political factor: The connection of factor is with government regulations and activities
that needs to consider while operation. Political considerations include foreign exchange
programmes, taxation, trade controls, public policies and the stability or uncertainty of the
democratic structure in the overseas market. Inside the United Kingdom, it is seen that the
country has a prosperous and welcoming political structure that offers tremendous opportunity
for firms with specific confectionery developments (Wu and Makin, 2019).
Positive impacts: In recent decades, tremendous political integrations have occurred
across countries that include business expansion elements. In addition, the UK government offers
incentives and subsidies to confectionery companies such as Cadbury and can boost their
position and boost the reputation of the industry with their acceptance, which could have a
positive effect on improving financial results and business plans.
Negative impacts: Nevertheless the existence of few circumstances will create obstacles
or problems for the organisation. For example, Brexit occurrence causes problems for the
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implementation of trade-related activities and working with other countries that have a negative
effect on growth strategy and the output of specified company.
Economical factor: Consumable consumer income, wealth creation, the market cycle
and so on is economic influences. The UK has an era of globalization and highly developed
economy that affects entity techniques' entire output.
Positive impacts: In context to Cadbury, management provides better taste and quality of
confectionary items which attracts large number of customers and attain the higher productivity.
Negative impacts: Continuously changing in interest rate can affect the business
negatively as productivity and sales of organisation as it create the higher cost in taking loan for
expansion of business (Maran and et.al., 2020).
Social factor: The common views of the population, age distribution, behaviours and
desires are related to social factors. In the United Kingdom, it is seen that social circumstances
are in pursuit of a business that makes it possible to render distinctive combinations of heritage,
crafts and others in the manufacture of variety of chocolates.
Positive impacts: Increasing lifestyle of changing of taste regarding confectionery items
Cadbury increases their sales all over the country as it is multinational company selling the
varirty of products and services which helps to maintain highyer productivity.
Negative impacts: Due to changing demand many competitors are existing in market
which has reduced the organisational performance as customers are switching their taste from
Cadbury to another item which affected business negatively.
Technological factor: Technical variables are creativity, technological up-gradation and
automation. In the UK, the technology that confectionary companies have to adopt according to
requirements is always evolving (Lombardi and Rodriguez, 2019).
Positive impacts: By using new technique, and innovation in confectionary items which
increases sales and profitability. Moreover, by using new technology organisation is providing its
product through online system which delivers higher productivity and sales effectively.
Negative impacts: In adopting new technology and online distribution channel cost of
Cadbury has increases which create the problem for business to arrange the funds and make
spending in expansion of business.
Legal factor: Legal variables set by the government in the UK are consumer rights
regulations, product safety regulations, equity and diversity law and advertisement guidelines.
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Positive impacts: Cadbury makes all its operational attempts by efficiently observing
government policies, legislation and laws. This helps to reduce government interference and
retain a leadership role without any complications or challenges that have a good impact on all
the organization's activities and strategies (Bilčík, Božiková and Malínek, 2019).
Negative impacts: when government is making amendments to existing laws, it creates
difficulties to conduct works according to new provisions that have a negative effect on the
management of changes, the implementation of new approaches and the brand profit of the firm.
Environmental factor: Environmental variables are diverse natural elements that affect
business operations. In order to establish projects to enhance regulatory laws, UK charities,
government bodies and local authorities have launched initiatives.
Positive impacts: The firm does not use elements that are forbidden by the legislation
and cause environmental contamination. It recycles its waste and eliminates carbon footprints,
which has a positive effect on its efforts to preserve clean and hygienic environments (Morais
and Franco, 2019).
Negative impacts: oppositely, not participating environmental safety activities can be
challenging situation for Cadbury to continue their business and activities.
CONCLUSION
From the report it can be concluded that different types of businesses are running that different
business are small, micro, medium and larger are operating. The external factors are related to
government and strict regulation that needs to follow in running. To follow effective structure
can be opportunity and develop the business effectively.
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REFERENCE
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