Different Types of Businesses and Their Characteristics

This report discusses the classification of different types of businesses based on legal entities and size, including micro, small, medium, and large businesses. It also explains the characteristics of different business structures such as sole trader, partnership, private limited liability, public limited liability, and cooperative with appropriate examples. The report provides insights into the functioning and operations of different types of businesses.

BUSINESS IN
PRACTICE

Contents
Introduction.................................................................................................................................................3
Discuss main criteria used to classify different kind of the businesses?......................................................3
Explain micro business with appropriate examples.................................................................................3
Explain small business with appropriate examples..................................................................................3
Explain medium size business with appropriate examples......................................................................3
Explain large size business with appropriate examples...........................................................................4
Explain the different companies from sole traders to Cooperatives and Limited Liability Partnerships......4
Define the sole trader business with an appropriate examples. Explain three characteristics of the sole
trader business?.......................................................................................................................................4
Define the partnership with an appropriate examples. Explain three key characteristics of the
partnership business?...............................................................................................................................5
Define a private limited liability business with an appropriate example. Explain three key
characteristics of the private limited liability business?...........................................................................5
Define the public limited liability business with an appropriate example. Explain three main
characteristics of a public limited liability business?...............................................................................5
Define the cooperative with appropriate examples. Explain three major characteristics related to
cooperative..............................................................................................................................................6
Conclusion...................................................................................................................................................6
References...................................................................................................................................................7

Introduction
Business organization is a single most essential choice an individual will make regarding his
company. What kind of the business form he adopts will impact a multitude of the factors, several of
which will decide his company future (Bai, and et. al., 2021.) This report purpose is to examine various
forms of the firms and business environment in better way. Here, all the enterprise are classified based on
legal entities and size that include few examples. This report will cove different business structure,
functions along with specific examples.
Discuss main criteria used to classify different kind of the businesses?
There are various criteria used in order to classify different types of the business. All kind of the
business structure is operated based on certain rules and regulation which are formulated by the
government. When all the business contributes to same economy, they do so in all the different size and
shapes. Classifying the business size should not be overlooked, as it aid appropriately measure impact and
success. There is various form of the business organization which is mentioned below:
Explain micro business with appropriate examples.
This form of the small business includes less than 10 employees within an organization. In this,
scale and size of a business are major difference in both the small enterprises and micro- business. In this
business, annual turnover is more than €2 million. It is examined that mostly micro-business are in
construction sector, social support, and retail and heal care industry. This kind of business are mainly
regulated in similar manner as other business organizations forms and that are taxed depends on the
business kind which is selected by a partnership, corporation and sole owner. Street vendors, carpenters
and small farmers are few example of the micro business.
Explain small business with appropriate examples.
It is a privately operated and regulated association, corporation, partnership that has limit ted
number of the employees who perform their work with the purpose to fain high income for the
organizations. This kind of industries plan a vital role in the development of economic and country’s
growth level (Chan, 2021). In this business owner invest a required amount of the money in machinery,
plants and sectors. This type of the business are considered as independent business which are governed
and owned by single proprietor who gain and bear both the loss and profit amount. Photography, agro
based industries and printings are certain examples of the small business.

Explain medium size business with appropriate examples.
It is most growing kind of the business that provides job opportunities for several people within
different sectors. Business employed around 100 to 499 employees for performing their work in reaching
the organizational desired objectives and targets. In this business total turnover is near about $10 million
to $1 billion. During 2017, center estimated around 200000 US firms are meet and attain their potential
target effectively. Such kind of business is mainly concern on managing their assets, income and
employees properly. This form of the business plays a vital role in economy and also contributes a higher
amount to nation’s development. Retail trade, wholesale trade and transportation are some example of the
medium size business.
Explain large size business with appropriate examples.
In this, such business are regulated mining and manufactured sector and this employs near about
500 workers reach with the desired growth of organizations. This for of the businesses does not produce
the product and also have around $7 million in turnover per year. Large businesses require a big amount
of the capital to be invested within operating firms. It will offer different employment opportunities for
the individual along with getting the needed output (Ford, 2021). This form of the business are
establishes entire the world such as Russia, UK, USA, Japan, Germany and Australia. Apple, Microsoft,
Google and Wal-Mart are few examples of the large size business.
Explain the different companies from sole traders to Cooperatives and Limited Liability
Partnerships
Define the sole trader business with an appropriate examples. Explain three characteristics of
the sole trader business?
It is simplest and easiest kind of the business structure which can be implemented very easily
with a low cost execution. Several aspect of business will be considered as legal responsibility of a sole
trader in that business structure (Gogokhia and Berulava, 2021). In this, sole trader is single individual
to make any decisions, business practices and employee’s hiring for his business operation. Sole trader
enterprise is mainly controlled or owned by a single individual who provide any special services. For
example hairdressers, photographer and plumbers are few of the kind of sole traders. In this for of the
business, owners are considered to be self employed individuals who are fully liable for the business
functioning, personal asses, debts and operations on the business procedures.

Characteristics
 Owners are responsible for every things related to the business operation
 Arrangement of the capital to be invested in sole trade to be done by proprietor to have full rights
on capital.
 Work of the sole proprietors is very limited as capital acquiring a nd other organizational skills of
individual are limited.
Define the partnership with an appropriate examples. Explain three key characteristics of the
partnership business?
In this business structure, two or more than two parties are involved in the operation and
management of a business and sharing any loss or profit in business. It is a formal arrangement where
parties are joined together in a legal manner and doing their business as per their investment share in
business capital. Partnership business mainly includes sharing of the profit, liabilities on equal basis in
some arrangements while it can differ in varied arrangement for any partnership business. Law firms,
physician groups, accounting groups and real estate investment companies are few examples of the
partnership.
Characteristics
 Act per the regulation minimal number of the partners is two and for banking business maximum
number of partners is mentioned 10.
 Agreements for carrying on a business should be with the purpose of making profit and share it
among all the partner equally.
 Business can be carried on by any or all the partners on the behalf of the other partners (Higgins-
Desbiolles and Monga, 2021).
Define a private limited liability business with an appropriate example. Explain three key
characteristics of the private limited liability business?
Limited liability business is that kind of the business structure in which structure of a business is
considered as combination of sole trader enterprise and partnership business that does not make an owner
of business liable for debt or liabilities of a company. This particular form a private limited firms comes
from US. Several organizations works with a label of the limited liability enterprise including
Westinghouse, blockbuster and many more. Respective business s most important kind of business in
which owner is not liable for any debt or liabilities of business.

Characteristics
 As per the act, firm must have minimum two members and maximum members are 200.
 Business must have maximum two directors and the maximum limit is 15 directors (Laidroo and
et. al., 2021).
 Respective kind of company must have the specific words that are “private limited” after
company’s name.
Define the public limited liability business with an appropriate example. Explain three main
characteristics of a public limited liability business?
Public limited ltd. enterprise is a kind of the business which is designated as limited liability firm
that offer the general share of company’s stock. Buyers of such stock’s share of firm will have a limited
liability as they will not be liable for any debt or losses of organization other than price of company’s
share stock. There are several types of the public ltd liability firms working across the world including
Rolls Royce holding plc, fidelity bank plc, Cadbury Nigeria plc, Burberry group plc and many more.
Respective form of the business structure is mainly based on UK firm’s law in which general public can
have their own shares in globally leading companies without being responsible for any business loss.
Characteristics
 Public company is considered as legal entity which has a separate identify form the members.
 Shareholders can transfer their shares to the public without any restrictions (Rana and et. al.,
2021).
 Shareholders are not accountable or liable personally for any kind of the loss in business.
Define the cooperative with appropriate examples. Explain three major characteristics related to
cooperative.
In organization, it is a private enterprise structure in which, owners of companies is service user
of firms and control different business operations. Cooperative business work to meet the member’s needs
and member are expected to understand purpose to meet specific task for the capital enhancement of
organization (Sadler-Smith, and Cojuharenco, 2021). There are several businesses concern including
land O’lakes, blue diamond are few examples of cooperative in producing field that work to meet
requirements of the organizational members and raising capital interest for their business process.

Cooperative business mainly works with a contribution of the several members to meet the business
requirements and make profit for the business.
Characteristics
 It is a voluntary associate of individuals and not of the capital. In this any individual can join and
leave the cooperative society.
 Every member shall work in general interest of the company as a whole ad not for personal self
interest.
 Human beings are under the cooperation and economic equality is completely ensure by the
general rules.
Conclusion
From the above report it is concluded that different kind of the business format including
medium, small and large along with the different structural forms of the business organization which are
working currently. This report has discussed about various type of the business format including limited
liability partnership, public limited liability,, sole trader and cooperative. It show variation within
business functioning and operation based on a type of the format enterprise owners are adopted to
perform their daily business practices efficiently.
References
Bai, W. and et. al., 2021. The role of business and social networks in the effectual
internationalization: Insights from emerging market SMEs. Journal of Business
Research, 129, pp.96-109..
Chan, E.P., 2021. Quantitative trading: how to build your own algorithmic trading business.
John Wiley & Sons.
Ford, L.R., 2021. Skyscraper competition in Asia: New city images and new city form.
In Imaging the City (pp. 119-144). Routledge.
Gogokhia, T. and Berulava, G., 2021. Business environment reforms, innovation and firm
productivity in transition economies. Eurasian Business Review, 11(2), pp.221-245.
Higgins-Desbiolles, F. and Monga, M., 2021. Transformative change through events business: a
feminist ethic of care analysis of building the purpose economy. Journal of Sustainable
Tourism, 29(11-12), pp.1989-2007.

Laidroo, L. and et. al., 2021. Business models of FinTechs–Difference in similarity?. Electronic
commerce research and applications, 46, p.101034.
Rana, N.P. and et. al., 2021. Understanding dark side of artificial intelligence (AI) integrated
business analytics: assessing firm’s operational inefficiency and
competitiveness. European Journal of Information Systems, pp.1-24
Sadler-Smith, E. and Cojuharenco, I., 2021. Business schools and hubris: Cause or
cure?. Academy of Management Learning & Education, 20(2), pp.270-289.