The Structure of Business

This article discusses the various types of business organizations, their legal status, sources of finance, and HR policies in the modern workplace. It covers topics such as the legal status of businesses, strengths and weaknesses of different sources of finance, and the three sectors within the UK economy. The content provides valuable insights for students studying business and related subjects.

The Structure of Business

Contents
Introduction.................................................................................................................................................4
Main body...................................................................................................................................................4
Question: One..........................................................................................................................................4
Construct a table in order to show the legal status of businesses which can be adopted with respect to
their strength and weaknesses..............................................................................................................4
Identify and evaluate the strength and weaknesses of sources of finance which are available for the
business startup....................................................................................................................................9
Question: Two.......................................................................................................................................11
Three sectors within the United Kingdom economy which business can operate..............................11
Question: Three.....................................................................................................................................13
Identify the two HR policies and also explain their importance to the modern work place...............13
Conclusion.................................................................................................................................................16
References.................................................................................................................................................17

Introduction
Business is an organisation in which entrepreneurs are engaged in commercial, industrial
or professional activities. The entities can be engaged in order to generate profitability from the
competitive market and also there are non-profit organisations which are operate fully as a
charitable mission. It is the type of organised efforts and activities of individuals who used to
produce and sell their goods and services in order to earn revenue from it. The range of business
can be scaled from a sole proprietorship to the international cooperation (Zhu and et. al., 2019).
The report is being discussed about the various types of business organisation with respect to
their strength and weaknesses of their legal status in United Kingdom. Further, different sources
of funds which can be used by the organisation in order to start up their business are also
discussed. Lastly, the HR policies and their importance with respect to the modern workplace are
also discussed.
Main body
Question: One
Construct a table in order to show the legal status of businesses which can be adopted with
respect to their strength and weaknesses
Base Meaning Strengths Weaknesses
Private
(Sole
proprietorshi
p)
It is also known as
the individual
entrepreneurship sole
trader or simply
proprietorship. It is
the type of fennel an
incorporated entity
which is owned by
the individual. It is
the simplest legal
form of business
 It is the most
expensive
which helps the
owners to start
the business.
 The sole
proprietorship
address to a few
regulatory
requirements as
the government
 Small business
owners are required
funds and
investments so that
they can grow over
the period of time and
for this it is most
difficult for the sole
proprietor in order to
raise their capital as
they are not supposed

entity which is easily
to startup as it does
not create a separate
legal entity from the
owner. It can be also
says that the owner
concise with the
business entity only
as he will be the fully
liable for any of the
liabilities incurred
within the
organisation. It is
most famous among
the small businesses,
freelancers and other
self-employed
people.
does not make
any restrictions
with respect to
their work.
 The sole
proprietorships
owners have
100% control
over the
management
and operations
of the
organisation. As
they are not
required to
answer the
shareholders
board of
directors or any
other persons.
to raise the funds
from the outside
investors (Zucchella
and Previtali, 2019).
This can slow the
growth and prevent
owners from
achieving their
business goals into a
specified period of
time.
 The sole
proprietorship dies
with the owner as
there is no sense of
permanence with
respect to these types
of entities. The
owners cannot pass
their business to the
family members are
trusted other people.
 The sole
proprietorship have a
personal liability in
order to address the
losses which occurred
in the sole
trader(Mitchell and
Gronenborn, 2017).

Public
companies
Public companies are
such companies
whose shares are
available in the open
market so that the
general public can
purchase their shares
usually it one of the
major stock market.
In United Kingdom
public companies are
denoted by the
acronym PLC after
their name for
example Sainsburys
PLC. In this the
shareholders can
easily transfer their
shares from one
person to another.
These types of
organisations used to
raise their capital by
issuing shares to the
general public. This
helps them to expand
their business into the
competitive market.
 Raising capital
through public
issue of shares
as it is the most
obvious
advantage
which are taken
by the public
limited
company as
they have
enabled it to
raise their
shares capital
(Franceschelli,
Santoro and
Candelo, 2018).
As these types
of organisations
are listed in the
recognised
Stock
Exchange.
 This helps the
companies to
take financial
opportunities
while
expanding their
business as it is
the another
 In order to protect the
shareholders the legal
and regulatory
requirements for the
public limited
companies are more
one address than the
private limited
companies as because
the government used
to develop more rules
and regulations in
order to protect the
interest of the
shareholders which
are helping the
organisation in order
to raise their capital.
 These types of
organisations are
required higher level
of transparency as
they are acquired to
provide more details
in the public domain.
 With respect to the
private limited
company is the
shareholders are that
typically one of the
people who are

potential source
of finance
which can be e
used by the
organisation in
order to satisfy
the
requirements of
their targeted
customers while
expanding their
business.
 The value of
being able to
raise finance is
helps the
employee to
serve their
business into a
better manner.
This helps the
organisation to
grow and
expand their
opportunities in
to the
competitive
market.
selectively to admit
the shareholders but
800000 respect to the
public limited
company it is much
harder to control who
is the shareholder of
the organisation and
who will be the
director who can be
ultimately
accountable for the
operations of
organization. This
resulted in use of
control of the
directions of the
organisation and for
this the company can
face several disputes
in order to manage
the shareholders
expectations.

Identify and evaluate the strength and weaknesses of sources of finance which are available
for the business startup
Bank loan:
It is the type of a loan when one receives finance from Bank with the chance of returning
it in future along with the principal as well as the interest amount (Foss and Saebi, 2018). These
types of loans are categorised under the secured loans as the person who is taking loan is
required to promising and acids in order to collateral it in case the borrower defaults or doesn't
repay the loan.
Strength:
 A bank loan allows one to repay as per the convenience with respect to the instruments at
regular and timely basis (Hilgers, 2018). Generally the Bank also used to provide the
overdraft facilities where all the creditors are deducted in go. The customers can also
have a Credit Card there the maximum limit cannot be utilised in one go.
Weaknesses: The person who is taking the loan has to go from the lengthy process.
 It is required by the banks to Collateral any of the assets.
 A lot of paper work is required which is difficult for the small business organisation to
undergo it.
 Low approval rates for small business companies and that makes them to difficult in
order to take the loan.
Crowdfunding
It is another type of source of funds with can be used by the startups organisation in order
to raise their capital. In other words, organisations can raise the small amounts of capital from a
large number of individuals in order to finance a new business venture (Malik, 2020). Generally
make use of easily accessible to the vast network of people through social media sites and other
websites to bring investors and entrepreneurs together so that the company can easily raised there
funds by expanding the pool of investors beyond the traditional circle of owners relatives and
venture capitalist.

Strengths
 It is the fastest way to raise the funds with no upfront fees.
 This platform can also used by the companies in order to take feedback and export guide
and so that the company can improve their operations which helps them to achieve their
goals in an effective manner.
 It is alternative finance option as as this helps in developing most loyal customers to the
financing process.
Weaknesses
 It is not necessary e bi f easier process to go through the compare with the traditional
ways of raising funds.
 It is important for the organisation to build up interest before the project launches so that
they can easily raise the funds.
 If the company do not reach your funding target so it will be difficult for the organisation
to receive funds from the competitive market.
 If the organisation failed in managing the risk hamper the reputation of the business and
in future the investors will not be interested in investing their funds in such a company.
Venture capital
This is another form of private equity and a type of a financing which helps the startup
companies and small business organisation in order to raise their capital. It is generally comes
from well of investors, investment banks and other famous Institutions of finance. The venture
capital is typically allocated to small companies with exceptional growth potential so that the
company can easily increased there funds in order to expand their business in competitive
marketplace (Thrassou, Vrontis and Bresciani, 2018). In these types of funding from role of
investors in high growth opportunities for the startup organisations and they are typically only
open to accredited investors.
Strength
 Beside capital financing venture capital is also important source of finance in which the
form usually appoint the board of startup company so that the venture capitalist can take
the decision in to the company (Movono and Dahles, 2017). This helps them to expand
their startups with the help of guidance which are beneficial for the organisation. The

guidance also helpful in order to develop the strategies techniques and other things which
can be e used by the business organisation in order to achieve their goals.
 Are huge network of connections of the business of communities helps the startups to
grow and become successful in the competitive market. This can help the startups to enter
into alliances with potential customers and other competitive firms.
 There are no obligations to repay the venture capitalist investors if the company is failed
or shutdowns. It does not leave the startups with the burden to pay back the amount as in
case of bank loans the organisations are required to pay back the amount.
Weakness
 The venture capitalist used to provide use capital to the small firms and in return for the
stake in equity of company this helps them to on tremendous amounts of profits by
working together. As the venture capitalist usually become the part of the board of the
organisation and also participate in taking the company decisions as they are interested in
protecting their Investments.
 Capitalist decide to redeem the investment within three to five years as the primary focus
is to on capital gain from the competitive market.
 The startup companies owner should first present a detailed business plan to the the
capitalist so that they can analyse the plan (Link and Scott, 2019). This helps them to
determine with respect to the points which are invested by them. It can also say that
venture capital funding is often found to be a lengthy process.
 The venture capital funding and was huge amount of risk.
Question: Two
Three sectors within the United Kingdom economy which business can operate
The Economist divided into different business sectors which are present in the competitive
market in order to provide the goods and services to the targeted audience. There are three main
types of industry which are operated into the competitive market (Orhan, 2017). In other words it
can also be says that these are the sectors which form a chain of production which provides
customers with finished goods and services.
 Primary production: this involves acquiring raw materials. It is also known as extractive
production. In these types of activities the entrepreneur is engaged in order to acquire the

raw materials and provide to the second reproduction so that they can manufacture and
assemble it which helps them in developing a finished goods.
 Secondary production: In this types of activities the entrepreneurs are engaged in
manufacturing and assembling the things so that they can convert the raw materials into a
component (Mancini, 2019). For example making plastics from oil, building houses,
bridges and many other things.
 Tertiary production: in these types of production the entrepreneurs are engaged in the
commercial services that support the production and distribution process (Van Megen,
Bürer and Patel, 2019). For example services such as teaching, Healthcare, hospitality
and many others.
Difference between primary, secondary and tertiary sectors
Primary sector Secondary sector Tertiary sector
The agriculture and allied
sector services are come
under the head of primary
sector.
The manufacturing sector
Industries coming under the
head of secondary sectors
(Hans, 2017)
.
The tertiary sector includes the
services sectors in which the
entrepreneurs are engaged in
providing the finished goods to
the targeted audience.
The primary sector is used
to provide the raw
materials for goods and
services.
In secondary sectors the
entrepreneurs used to change
one goods into another by
building more from it.
In these types of sectors the
organisation is to provide their
services to both the primary
and secondary sectors
(Dlamini, 2017).
The primary sector uses the
traditional techniques so
that they can developed the
raw materials and these
types of organisations are
mostly unorganised in a
The secondary sector uses
more reliable methods in
order to produce the goods
and are is organized.
These sectors use modern-day
Logistic methods in order to
execute their operations and
they are much organised.

manner.
Question: Three
Identify the two HR policies and also explain their importance to the modern work place.
Equality and diversity policies
The diversity refers to the existence of variations of different characteristics in a group of
individuals. In other words it can also say that the diversity is race and gender there is more than
that. It is important for every organisation to focus on diversity equality in the working place.
This helps Human Resource Department to motivate the employees within the organisation as
because of the equality and Diversity policies. This can be also used in order to provide better
opportunities to the candidates within the organization (Kowallik and Degenhart, 2018). The
collective sum of individual differences life experience, knowledge, innovations, self
expressions, their capabilities and talent which the employees use to invest in their work. This
helps the department to encourage their employees which are belongs to different in respect to
their age, color, disability, family, background and marital status. This resulted in developing the
Unique Identity of the employees within the organisation and the companies are not supposed to
differentiate the workforce with respect to their Unique Identity.
Importance
 Respectful communication and cooperation between the employees can be observed
within the working environment.
 This helps the team members to work together and participate in every activities which
helps them to achieve the better results.
 The diversity and equality helps the workforce to manage a balance between their work
and personal life through the help of flexible work schedules which can be accommodate
Employees with respect to their needs.

 The diversity and equality helps the employer and employees to contribute to the
communities and also used in order to promote a greater understanding so that they can
achieve the opportunities which are present in the competitive market with respect for the
diversity.
Health and Safety policies
The policy which can be described as a course of actions that has been chosen to
influence the workplace. This helps the organisation to take better decisions and guide the
actions health and safety of the employees. It is the most common policy which exist as a body
of regulations within the organisation as it is also determined by the government and it is
important for the every organisation to implement it within the working environment. These
types of policies helps the workforce to work in a better environment which is also used in order
to motivate them as the positive and healthy environment give the positive vibes to the work
force to work and this resulted in better outcomes from them (Jung and Takeuchi, 2018). The
work please also create safety policies in order to satisfy the general duties of the employers in
order to provide a safe workplace to their employees
Importance
 These types of policies must be looking into the organisations as this implies that the
company cares for their workers. This helps the companies to generate Goodwill into the
competitive market as it is the gesture which shows that the company is willing to take
the responsibilities of their work force as long as there inside in the working premises.
 When a company takes into account the health and safety policies of their workforce then
there is a certain amount of credibility which is gained by the organisation. The best part
of this policy is that it creates a strong work force base and the trend to rely on the
organisation. This is also used in order to develop the easy and relaxed working
environment among the employees.
 These types of policies helps the organisation to increase their workforce as they all have
the luxury and the perks which are given to the Employees as they deserve to get it. The
best way to do that is by creating healthy and safety policies that will take care of the
work force as it is beneficial for the organisation also. It is important for every company
to improve the organizational health care and safety measures so that it helps them to
satisfy and motivate the workforce within the organisation.

Conclusion
It can be concluded from the above report that it is important for every startup companies
to identify the strength and weaknesses of the legal status. It is important for business
organisation to identify various sources of funds which can be adopted by the organisation in
order to raise the capital. There are three sectors within the economy in which the business can
operate which includes Primary secondary and tertiary. This also plays an important role in order
to develop the economic conditions of the nation. Lastly, the report is being discussed about the
HR policies with respect to their importance which include health and safety policies and
equality and Diversity policies.

References
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