Different Types of Businesses and Their Characteristics

This article discusses the main criteria used to classify different types of businesses based on their size. It explains micro, small, medium, and large businesses and their contribution to the industry. Additionally, it defines and describes the features of sole trader, partnership, private limited liability, public limited liability, and cooperative businesses. This content is relevant to the BSC (Hons) Business Management with Foundation course under the Business in Practice module (BMP3002) at the University of Bolton and Regent College London.

University of Bolton
REGENT COLLEGE LONDON
BSC (Hons) BUSINESS MANAGEMENT WITH
FOUNDATION
SEMESTER 1, EXAMINATION 2021/22
BUSINESS IN PRACTICE
MODULE NO: BMP3002
Exam Paper Release Date & Time: Saturday 11 June 2022 at 10:00am
Submission Cut-off Date & Time: Monday 13 June 2022 at 10:00am
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ANSWER BOOKLET
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[Start writing you answer from this page. There are THREE questions. You are required to
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Question no. 1(a)” or “Answer to the Question no. 3(b)” etc]

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QUESTION 1
1. Main criteria used to classify different business kinds
The size of the business is considered as the main criteria in order to differentiate them from
each other. Size explains the scale at which the business is operating and what are the different
aspects that make them unique from other kind of businesses. There are micro, small, medium and
large businesses which are differentiated on the basis of their sizes and have a significant
contribution in the industry. These size standards may differ from industry to industry and are
usually measured on the basis of the number of employees and the annual income which is
generated buy the business.
2. Explaining microbusiness
Microbusinesses are considered as a type of small business which does not employ more
than 10 people in their firm. It is very easy for any person to start a microbusiness as it requires very
less capital and resources. It can also be operated by a single person which may conduct the overall
practices of the business alone (Cowell, Lyon-Hill and Tate, 2018). The examples of
microbusinesses are street vendors, grocery stores, repair shops, shoemakers etc. which can be
operated at a lower scale and help a person to earn money for their living.
3. Explaining small business
Small businesses are considered as a privately owned corporation, partnership or sole
proprietorship having fewer number of employees and generates less yearly revenue in comparison
with a large company. These businesses consist of a large market in the overall sector which has a
significant impact on the overall business environment. They provide the most number of
employment opportunities for the people to explore and gain a significant share in the industry.
They have a important contribution increasing the economic development of the business.
Examples of small businesses are agro-based industries, tuition centres, photography stores, small
scale manufacturing businesses.
4. Explaining medium size business
The medium sized businesses are considered as the corporations which have are above small
scale and are considered as well established in the industry. These businesses have a high market
share in the industry, and they are related with increasing the overall effectiveness of the business to
produce better results. They require a comparatively higher investment and more employees to set
up and operate as they work at a higher scale and have better competitive advantage in the industry.
These medium businesses are between the large and small corporations having a significant
contribution in the overall development if the economy. For eg. Local restaurants, garages, grocery
stores etc.
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5. Explaining large size business
Large businesses are referred as big corporations that have a greater market share in the
industry and considered as one of the most important part of the overall economy. These
organizations have 500 or more employees working for them and also have a huge contribution in
the development of the sector they are working in (Johnson, 2021). These large organizations helps
in providing employment to the people in all over country and operate on a comparatively larger
scale in the business than any other business organization. Some examples of these large businesses
are motor organization, car manufactures, industrial giants, pharmaceutical companies etc.
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QUESTION 2
1- Defining sole trader business with appropriate examples and three main features of that.
Those companies or ventures that are running and managing their businesses individually,
without following any partnership term are known as sole trader venture (Pagura, 2021). It is also
named as sole proprietorship, according to which entrepreneur take approach to form strategy
related to their venture independently. Barker and Stonehouse is the best example of sole trader,
that has established in the UK and recently selling quality furniture to target audience.
Freedom of work is the best key feature of sole trader, that impact positively upon individual
business growth. Unlimited liability and absence of government regulation are another
characteristics related to similar concept, that allow entrepreneurs to take pleasure of increasing
profitability.
2- Defining partnership with appropriate examples and three main characteristics?
Partnership is one of those legal structures that majority of companies has been followed, for
purpose of achieving target goals and objectives. Rivers simple and British Volt is the best example
of partnership companies, that run their ventures in collaborative manner (Pandey, 2021). Mutual
trust is included in key feature of partnership that make both partners profitable. Equal opportunities
and risk tolerance, are also added in list of characteristics that partnership structure or legal concept
encompasses. It may enable both companies to grow rapidly and productively.
3- Defining private limited liability venture and characteristics related to that.
Private limited liability is considered as specific form of privately owned venture in which
the owner or founder liability is limited to their profits, as venture may have limited to had 50 or
more than that stakeholders. John Lewis is private limited liability company that exist in the world
of business, such as in the UK and establish brand existence in varied nations. The best feature of
this type of company is decisions are held by few individuals who may have specific legal entity,
that eliminate risk of clash. Limitation on membership and perpetual succession are also covered
under the concept to LTD characteristics.
4- Explaining public limited liability business and characteristics in the context of that.
PLC's are designated an organization that offer share of stock to common public and run
their businesses with motive of enhancing customers satisfaction level. Barclays is an example of
public limited liability organization, that exist in the British market and provide satisfactory services
as well as products of individual person.
The strategic feature of PLC is more attention, risk division and expansion opportunities that
it may encompass, which enable an organization to enhance performance and increase the same.
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5- Defining cooperative and characteristics of that term.
In the world of business, cooperatives are those ventures that has owned by member owners
and controlled via them, by taking right decision. The best example of cooperative business form is
Farmer co-ops in the UK, which aim is to help farmers obtain market power in form of joining
together to market their ventures. Finances, liability of members and democratic control, are the
best characteristics of cooperative company, that in turn provide a lot of benefits to them.
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Reference List (if Any)
Write your answer here
Books and journals
Cowell, M., Lyon-Hill, S. and Tate, S., 2018. It takes all kinds: understanding diverse
entrepreneurial ecosystems. Journal of Enterprising Communities: People and Places in the Global
Economy.
Johnson, L.W., 2021. Businesses—Open Access Journal on Business. Businesses. 1(1). pp.34-35.
Pagura, I., 2021. Law report: The company: An alternative business structure. Journal of the
Australian Traditional-Medicine Society. 27(3). pp.156-157.
Pandey, M. K., 2021. Partnership Firms and Agreement. Supremo Amicus. 24. p.811.
The End
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