Types and Purposes of Organizations

Running head: MANAGEMENT
Management
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P1: Explain different types and purposes of organisations; public, private and voluntary
sectors and legal structures
In the business world, 4 chief organization exits that includes
1. The sole trader
2. The partnership
3. Limited Companies
4. The voluntary Company
5. Franchises
6. Charity organizations
7. Government organizations
The Sole trader:
The sole trade refers to the business that is owned and operated by a single individual.
The sole proprietor is considered to be the sole profit taker of the business. In this type of
organization the legal liability of the owner is high. On the positive note, for setting up a sole
trader business paper work is not required (Salamon and Sokolowski 2016). Decisions can be
made in a rapid manner and contact can be kept with both consumers as well as employees.
The partnership business:
The partnership business can be comprised o two or 20 partners. According to the
partnership Act 2002, some types of business organizations like the big accountancy
organizations can have a good number of partners in order to experience limited liability (Noe et

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al. 2017.). One of the advantages of this type of organization is that partners cans hare skills and
the workload and thus it become easier to raise the capital.
The limited sectors
The private limited companies: This type of organization possesses limited liability along with
private shares. The structures of the private limited companies are smaller than that of the public
limited organizations. Shares in a private limited organization can only be bought and sold after
gaining permission of the Board of Directors. Not only this, share holders also posses limited
responsibility.
The public limited companies
Unlike private limited companies, public limited companies possess higher workforce. Not only
this, the share of public sectors can be purchased by any individual.
The voluntary organization
This type of organization includes a group of individuals who are involved in an agreement to
attain a specific purpose. These companies are formed in order to bring socio-economic
development of rural individuals along with promotion of culture, art as well as sports. One of
the example of voluntary organization in UK is Bloodbot.
Franchising
Franchising is opening a business under the name of a already existing popular brand. A
franchise grants permission to sell a product and trade under a popular name in a particular area
(Bromley and Meyer 2017). According to regulations, the individual who is taking out the