Different Types of Companies and Business Structures

This report provides an overview of different types of companies and business structures. It discusses micro businesses, small businesses, medium-sized businesses, and large businesses, highlighting their characteristics and examples. It also explores various business structures, including sole traders, partnerships, limited liability partnerships, public limited liability businesses, and cooperatives. The report further examines how organizational structure affects business productivity and analyzes the external factors that impact business performance through PESTLE analysis. Overall, it offers valuable insights into the diverse landscape of business organizations and their functioning.

Individual Report

Table of Contents
INTRODUCTION...........................................................................................................................3
Section 1: Different types of companies and how they work .........................................................3
Section 2: Different companies from sole traders to cooperatives and Limited Liability
Partnerships ....................................................................................................................................4
Section 3: Different business structures and external factors affecting business............................6
3.1 Identification of different organizational structures and explaining how does
organisational structure affect business productivity.............................................................6
3.2 Different external factors affecting the performance of a business – PESTLE Analysis 8
CONCLUSION .............................................................................................................................10
REFERNCES.................................................................................................................................11

INTRODUCTION
There are different types of business organisations that differ according to its sizes and
scope. Different types of companies are working according to specific requirement and objective
which they set in the initial stages of every business organisation. Organisation also differ based
on their legal structure and formation criteria like sole proprietorship, partnership, limited
liability partnership are some types that differ according to their legal structure & scope. Further
there are different business structures like divisional, functional according to suitability of every
organisation (Ahmed, 2016). There are certain external and internal functions that are part of
every organisation and affect the way organisation are working towards strategy formulation and
implementation.
Section 1: Different types of companies and how they work
Micro business:
Micro business are those organisation that are having their annual sales & assets that are
valued at less than $250,000 every year and they have less than five employees including the
owner of organisation. These business have expanded in many industries that can expand beyond
their foundation but size remains same (Kaiser and Semple, 2017). A micro business has to be
treated as same level and its examples include catering, photography, house cleaning, accounting
etc.
Example: Castle Hill fire protection Ltd. Is a micro business example that is having
specialisation in installing fire protection system and products through UK. They have achieved
145% growth in last three years.
Small business:
Small business are those that are having less than 10 employees and their turnover is also
less than 2 million pounds.

Example: Broadsword event house is organisation that is working towards a culture of high
expectation to provide teams a focus and purpose. It helps in development of world class events.
Medium size business:
Medium sized business organisation is having less than working staff of 250 employees
and their turnover is also less than 50 million pounds (Riis, Hellström and Wikström, 2019).
Example: Captify is a medium size business that is having specialisation in media and
intelligence. It was founded by Dominic Joseph & Adam Ludwin launched in year 2011. they
have enhanced their gross revenue by 300 percent and their employees base by making a
investment of 8 million pounds.
Large size business:
Large size business are those that are having more than 250 employees and having
presence in different locations.
Example: adm group is a grown business that consist of 400 people in their 27 offices that are
part of 19 countries. Their main objective is to integrate the adm's software to improve the
performance, user experience and resilience.
Section 2: Different companies from sole traders to cooperatives and
Limited Liability Partnerships
In UK LLP is subjected to partnership that is combination of typical partnership and is created
with help of a LLP written agreement that is used for specifying its formations and operations.
Sole trader business:
Meaning: A sole trader is a self employed person who is running their own business as a
individual they don't posses any legal entity separate from their owner (Diefenbach, 2020).
Characteristics: They posses absolute control over their business, profits after tax and assets.
These organisation posses sole management and unlimited liability. These organisation have full
freedom to make all the rules & regulations of their business.

Example: Russell walker & Co, Peter Brown AFA, Colin Bush & Co is examples of sole trader
business of UK.
Partnership:
Meaning: A partnership form of business is one that is existing when two or individuals are
commencing a business together for the sole motive of earning profit.
Characteristics: there is a agreement and sharing of profits take place according to written
guidelines. There is no transferability of interest & fusion of control ownership that takes place
in these agreements.
Example: Apple Inc is a brand that was founded by Steve jobs & steve wozniak who started this
brand as co partners in year 1976. Google was also founded by Larry page & serge Brin as
partners.
Limited liability business:
Meaning: Limited liability business are those where the owners are liable to pat the debts in the
situations of need but only posses a limited liability to be paid (Creedy and Hoang, 2018).
Characteristics: LLP require filing of documents and all members posses limited liability. All
the profits and losses are flowing through members according to preparation arrangements, local
laws and capital accounts that is proportional to contributions.
Example: Oxfam is one such example of limited liability brand of UK.
Public limited liability business:
Meaning: It is a type of organisation who can raise funds by offering their shares to public it is
related with raising funds from public and freely trading of shares.
Characteristics: There is a certain specific criteria to start this type of partnership business &
liability of each member is limited.
Example: These shares are listed on platforms like London stock exchange or on Alternative
Investment Market.
Cooperative:

Meaning: Cooperatives are business that are controlled and owned by members who are
customers, suppliers, staff, residents and combined stakeholders.
Characteristics: there is voluntary membership and all members posses democratic control.
There is limited interest on capital and organisation is formed with a service motive without any
intention to earn financial profits.
Example: There are many cooperative societies of UK including Central England co-operative,
channel Island co-operative.
Section 3: Different business structures and external factors
affecting business
3.1 Identification of different organizational structures and explaining how does
organisational structure affect business productivity
Illustration 1: Functional & divisional organisation structures

Functional structures: These are the ones that posses reporting relationships of
organisation that is bifurcated according to the specific functional area.
Divisional structure: It is a organisational structure where functions are divided
according to different service and product lines and is commonly regarded as divisional
structure.
The structure of a organisation is setting the hierarchy for creating level of communication and
responsibility (McPhail and Rata, 2016). It is a manner where a organisation structure is set up
and it is having administration on the direct impact on organisations productivity level.
Managerial influence: The efficiency of managerial staff in a organization creates a
broad reaching effect in the structure. If there is incompetent management then it might spread
throughout the organisation and reduce overall productivity.
Structural flaws: If the structure of a organisation is not set up properly then information
might not travel when it is required (Moore, 2016). If in middle of process there is no proper
communication channels then it might lead to wastage of lot of time in these flaws in
organisational structure can lead towards breakdown of communication. It might also lead to
lapses in responsibility required for facilitating efficiency.
Creativity: Employees innovative ideas is necessary for success of any organisation.
Influx of employee ideas help in having large number of options. For example if in a
manufacturing organisation there is a idea to make better use of equipments at lower cots then it
might lead to improvement in organisation productivity (Abcouwer, 2016).
Growth: As the organization grows if there is weak communication and internal structure
then it might lead to inefficiency at some point. There is requirement of a strong corporate
structural improvement that is necessarily required when the organisation is expanding. Change
is a inevitable factors and it is very important to have flexibility in a organisation in order to deal
with the unexpected market mutations to understand the difference between extinction and
survival of the organisation. There are always different government legislations that are proposed
in order to understand the critical success factor for organisations.

3.2 Different external factors affecting the performance of a business –
PESTLE Analysis
The external factors that consist of different customers, competitors, economy and
politics that are uncontrollable and posses a influence on performance of a organisation. The
profitability and stability of a organisation and also affecting it in long run (Ghislain, and Clair,
2017).
Internal factors affecting the functioning of organisations:
Apart from different external factors there are some internal factors also that posses a impact on
the way organisation are functioning. Such as:
Mission: Every organisation must successfully develop their mission with a clear sense of
ultimate purpose and how to fulfil that purpose.
For example: Steve job's had a mission and their ultimate goal” To make contribution to world”.
Leadership: Great leaders are the ones who inspire everyone.. Steve jobs was the one
with his leadership skills and influencing capabilities was able to create a organisation with a
team of highly competent & dedicated employees. This has actually resulted in the success of
Apple according to its bard positioning through world.
Learning: It is one of the most fundamental human activities that are accounting with
indirect and direct success of a organisation. With technological advances there are faster
changes and organisations have find a way to respond to innovation and building up of employee
experience to get a opportunity to explore and learn. Many successful organisation like Amazon,
Apple and Google are working towards exploring new areas so that they are part of continuous
developments & innovation that can be adopted by these organisations.
Above discussed are some of the essential factors of every organisation that aper Present
and are affecting their overall strategic formulation and functioning (Idowu, Soyebo, and
Adeoye, 2019). Apart from these there re many external factors also that are impacting the
organisation & these factors are mentioned below:
Political factors: There are certain political factors that are having relation with the
government policies of every country. They posses a impact on organisation according to the
industry type they are belonging. The factors of political factors consist of political stability,
government policy and trade & taxation policies.

Economic: Economic factors are related to economy of a country. There are certain
factors like shifts in the demand and supply that can poses a impact on the functioning of a
organisation (Ibnu, Offermans, and Glasbergen, 2018). There are also factors related to
economic growth and decline conditions. Further Changes in inflation and interest rates also
impact the internal functioning of organisations. Purchasing power of customer also affects the
demand of different products & services in the market.
Social factors: There are several social factors that are related to the sociocultural
environment of a organization. It is having relation with needs & demands of customers. Three
are many social factors like population analytics, emerging trends and demographics. Social
factors are also in relation with the trends, awareness & status of people that is affecting their
behaviour to purchase various products. Social environment consist of values, lifestyle and
customs that is different for each country.
Technological factors: Technology is a factor that is part of external environment and
changes in this might most quickly impact the information age and result in production of
disruptive technologies (Jonathan, Rusu, and Perjons, 2019). For example: Tesco is a large
multinational organisation that has adopted the system of automation payment for their
customers in which they have adopted a technological development for the purpose of increasing
the ease for their customers. It has been because of the requirements that is taking place in
different retail brands across different parts of the world because of globalisation & development
of a competitive advantage. In order to survive in the highly changing global environment.
Legal environment: There are certain legal factors that affect the operations of a
organisation. It is related with the laws that are part of countries and all business organisation
whether small, large or medium sized have to comply with them. It consist of laws related to
wage rates, disability discrimination, environmental laws (Lenaerts, Kilhoffer, and Akgüç, ,
2018). There are many international agencies that are affecting the legal working culture &
polices of a organisation.
Above discussed are the factors that are part of external environment of a organisation
and can posses a impact on their internal functioning.

CONCLUSION
From the above discussed points it can be said that every organisation is working
according to the structure and formation of a organisation. Every organisation is different
according to its legal structure. There are many different external & internal factors that pisses a
impact on the way organisations are functioning.

REFERNCES
Books & Journal
Ahmed, A., 2016. The challenge of implementing integrated environmental management within
an organisation structure: the case of the environmental section at Drakenstein
Municipality (Doctoral dissertation, Stellenbosch: Stellenbosch University).
Kaiser, V.B. and Semple, C.A., 2017. When TADs go bad: chromatin structure and nuclear
organisation in human disease. F1000Research, 6.
Riis, E., Hellström, M.M. and Wikström, K., 2019. Governance of Projects: Generating value by
linking projects with their permanent organisation. International Journal of Project
Management .37(5). pp.652-667.
Diefenbach, T., 2020. The Democratic Organisation: Democracy and the Future of Work.
Routledge.
Creedy, J. and Hoang, H.T., 2018. Types of microfinance organisation: A taxonomy. Third
Sector Review .24(2). p.105.
McPhail, G. and Rata, E., 2016. Comparing curriculum types:‘Powerful knowledge’and ‘21st
century learning’. New Zealand Journal of Educational Studies, 51(1), pp.53-68.
Moore, B.L., 2016. Unravelling higher order chromatin organisation through statistical
analysis (Doctoral dissertation, University of Edinburgh).
Abcouwer, A.W., 2016. Power Sharing and its Effect on the Adaptiveness of an Organisation.
Ghislain, B. and Clair, B., 2017. Diversity in the organisation and lignification of tension wood
fibre walls–A review. IAWA Journal .38(2). pp.245-265.
Lenaerts, K., Kilhoffer, Z. and Akgüç, M., 2018. Traditional and new forms of organisation and
representation in the platform economy. Work Organisation, Labour and
Globalisation .12(2). pp.60-78.
Jonathan, G.M., Rusu, L. and Perjons, E., 2019, December. Organisational Structure’s Influence
on IT Alignment: The Case of a Public Organisation. In European, Mediterranean, and
Middle Eastern Conference on Information Systems (pp. 471-485). Springer, Cham.
Ibnu, M., Offermans, A. and Glasbergen, P., 2018. Certification and farmer organisation:
Indonesian smallholder perceptions of benefits. Bulletin of Indonesian economic
studies .54(3). pp.387-415.
Idowu, H.A.O., Soyebo, K.O. and Adeoye, E.A., 2019. Incentives as correlates of employees
loyalty towards management in organisation. African Journal of Business
Management, .13(12). pp.407-414.