Types of Companies and Organizational Structures - Business in Practice

This report discusses different types of companies and organizational structures in business, including micro, small, medium, and large businesses, as well as sole traders, partnerships, cooperatives, and public limited liability businesses. It also covers how external factors such as political, economic, social, technological, legal, and environmental factors affect business productivity through PESTLE analysis.

BSc (Hons) Business Management with
Foundation
BMP3002
Business in Practice
Assessment 1
Types of Companies
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Contents
Introduction 3
Section 1: Different types of companies and how they work 3
Section 2: Different companies from sole traders to cooperatives and 4
Limited Liability Partnerships
Section 3: Different businesses structures and internal factors affecting 6
business
Conclusion 8
Reference List 9
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Introduction
The aim of the report is to examine the various types of organisation that are
operating in the business environment that are contributing to the growth to the economy.
Business in practices is the subject matter which is concern for specific for of work by using
some sort of strategies so that they can reach to their desired objectives(Sarantseva and
Polenova, 2018). This report will covers different types of business such as sole
proprietorship, partnership etc. For this, company is understanding the different concept of
the business so that they can motivate their workforce to get the group goals under the
applicable law and business. This also analyse the factors available in the internal and
external business environment which is affecting the overall functionality of the business.
Section 1: Different types of companies and how they work
Micro business:
Meaning: In this type of venture business has been operated with few amount of
funds and capital with limited resources in order to run their venture. They are engage in the
some business venture for their survival and taking full consideration of their family and
friends and for their survival(Bulysheva, Kataev and Loseva, 2017).
Characteristics: These are the firm which is operating their venture with 0-9
employees working and generally earn the revenue of approx £632000. such enterprises
evaluate the needs and wants of the customer to be fulfilled in an appropriate manner.
Example: Boss brewing is the suitable example of micro business which is a multi
award-winning brewery in Swansea and mainly lead by the woman.
Small business:
Meaning: These are the business which is operating their business on small scale but
they are larger than micro businesses. They are offering employment opportunities so that
they can showcase their skills and abilities in order to get effectiveness in the business. They
usually generate the annul turnover of € 2 million
Characteristics: Such business venture which are working to the limited areas and
they are having 9-49 employees working by forming the small groups of employees so that
work can be done in an easy approach(Moreno, 2020).
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Example: Broadsword event house is the business support company in the United
Kingdom. They also engage in promoting sports, Arts and other events. These are the firms
which are engage in organising mega events.
Medium size business:
Meaning: The type of business ventures which are engage in operating their business
on larger scale and also have the consideration of generating higher profitability. There are
operating their business by having sufficient funds and capital so that they can focus on
having effectiveness in the operations by having employees 50-250. they take the appropriate
decision-making related to investment. Such organisations are emphasising on new business
location so that they can expand their business.
Characteristics: The type of businesses which are working with limited funds and
capital and also having more than 50 employees for meeting the higher competition in the
target market. High risk is integrated in order to open new store in different locations.
Example: Captify is the suitable example for such business as they are engaged in
conducting intelligence research and also have the concern for taking major decisions in the
market in order to run their business.(McNulty, 2017).
Large size business:
Meaning: It refers to the type of business which is operating their business on large
scale or can be worldwide. They are operating their business by they can satisfy the need and
wants of the potential buyers so that they can contribute in the profitability of the company.
There is huge competition in the market for that they ensures quality product to be sold to the
customers and ensuring high profits and revenue.
Characteristics: these are the organisations which are having more than 250
employees and they are being assigned different duties as such companies provide various
job opportunities order to enhance the living standard of the society and they generally earned
the revenue of € 1.5 million.
Example: Pentland is the British privately owned company which is dealing in
footwear and textiles an operating their business worldwide and their headquarter is in
Finchley, London and the company is established by Stephen Rubin in 1981. they are
working with the sole consideration of providing quality product so that they can be the
market leader .
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Section 2: Different companies from sole traders to cooperatives and
Limited Liability Partnerships
Sole trader business:
Meaning: It is the type of venture which owned ans mange by the single individual as
there is no interference of the other party. The individual person is responsible for all the risk
and looses and this is the step where an individual has the obligation to operate the separate
business entity in which they pay their tax individually(Jermsittiparsert, 2020).
Characteristics: It is the business in which the business is owned by the single
person as there is no separate entity or the partnership in order to share their profits and
looses. The owner is the manager of the company who is responsible for all the risk and other
factor of production. There are having resources and capital just to operate their business for
their easy survival.
Example: Plumbers, Hairstylist and Carpenters.
Partnership:
Meaning: It is the business in which two or more individual come together under the
agreement in which they share their profits and looses on agreed ration and also liable to
follow the guideline as per the agreement. Both the partners are liable to pay the tax to the
government and it is required for both of them to sow their capital and funds so that they can
operate their business with transparency.
Characteristics: The main feature of such business is that partners are liable to share
their profits and looses as per the agreement. there is no separate legal entity of the company
and the owner and they are having fix period of time for conducting their business in an
partnership.
Example: Deciduous partners Ltd id the suitable example for such type of business, It
is the consultancy firm which is giving information or knowledge which based on the
management services.
Public limited liability business:
Meaning: It is the type of business which is engaged in operating their functions
under the law that is being framed by the government of UK. They easily conduct their
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business by selling their shares to the general public and based on the voluntary association
which define such business as the legal organisations.
Characteristics: These are the type of organisation which is having separate legal
entity from their director and the shareholders who are involved in the formation of the
business. They ensure running of the business under the effective follow-up of government
rules and laws.
Example:Burberry and Tesco is the best example for the such type of business and
they are working with the sole concern of generating higher profits and also fulfilling the
needs and wants of the potential buyer.
Cooperative:
Meaning: These are the type of organisation who is working with the main
consideration of satisfying the needs and wants of the customer so that they can attract the
large group of customer. It is basically privately owned by the individual or the group of
people without any inference of government. Main motive is to generate higher profits so that
they can be the market leader(Hernández-Lara, Serradell-López and Fitó-Bertran, 2019).
Characteristics: It is the business entity which is operating their business without any
interference of the government bodies and main focus is to have higher profits so that they
can sustain in the market for long period of time. They are having sufficient funds and
capital in order to expand their business to new locations.
Example: The best example of cooperatives is Infinity Food Shop which is offering
organic food to the customers.
Section 3: Different business structures and external factors affecting
business
Identification of different organizational structures and explaining how does
organisational structure affect business productivity
Organisational structure is defined as the way in which company is operating their
way by setting some sort of policies, framework and assign duties to the concern bodies so
that all the work can be done with the right approach. They also evaluate how they can
control their overall functions to get the effectiveness within the organisations. There are
different organisational structure such as flat, hierarchical, divisional structure so that
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business can use one according to their size and need for the business which ensure the
effective accomplishment of the business goal. They also ensure the easy flow of
communication by establish right channels of communications.
 Divisional structure- It is the business structure in which various task is being
divided into small units so that they can understand the required resources and
funds. In context to Pentland, They are operating their business on larger scale
and having many department in their organisation so this structure helps in
getting all the work done in an appropriate manner. They also ensure clear
results by diving the various task to their concern bodies.
 Flat structure- It is the organisational structure which is being adopted by the
organisation in order to start their new business and they are having limited
level of management by having full control over the top level management by
which they can effectively meet out the objectives of the company(Marcolin,
Vezzetti and Montagna, 2017).
How different external factors affect the performance of a business – PESTLE Analysis
It is necessary to have the emphasis understanding the external factors so that
organisation can take the appropriate decisions. For analysing the external factors, PESTLE
analysis is being conducted in order to cope up with the different business aspects in the large
market. In context to Pentland, PESTLE analysis is being given below:
 Political factor- These are the factors which includes government taxations,
rules and regulation. IN 2011 and 2012, there is decline in the corporate tax
rate which eventually had an influence on the growth of business revenue and
Pentland has started moving towards charitable activities.
 Economical factor- Due to global financial crises, the relative growth of GDP
in UK tends to decline and that does not provide any earning per capita. This
hurdle the profitability of Pentland and also effects the various funding and
capitalizations.
 Social factor- As the majority of the individual is having good taste and high
living standard which means Pentland use to preferred quality cloths and
footwear by which they can generates higher profits and revenue.
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 Technological factor- Due to technological development in the UK, Pentland
has started to made product or large scale in less cost which is leading to
generate higher profit margins in the organisation.
 Legal factor- These are the factors which includes laws imposed by the
government for the welfare of the society and the company. In context to
Pentland, they are running their business in lawful manner so that they can
influence their employees for better working. They are following heath and
safety law and ensures better working to the employees.
 Environmental factors- These are the factors which are concerning the
ecological balance as Pentland is using jute polythene instead of plastic
polytene so that they can contributing in saving the environment(Oddy and
Bason, 2017).
Conclusion
It is concluded from the above report that business in practice is the important factor
that helps the business by which company can meet their set goals and objectives with in the
set time period. There are various business such as micro, small, medium and large which
contribute in the growth of the economy. Organisation work on the basis of their funds,
capital and resources and choose the best organisational structure. Moreover, factors of
external environment has been analysed in order to establish good market position.
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Reference List
Bulysheva, L., Kataev, M. and Loseva, N., 2017, October. Modeling of service time in public
organization based on business processes. In International Conference on Research
and Practical Issues of Enterprise Information Systems (pp. 3-11). Springer, Cham.
Hernández-Lara, A.B., Serradell-López, E. and Fitó-Bertran, À., 2019. Students’ perception
of the impact of competences on learning: An analysis with business
simulations. Computers in Human behavior. 101. pp.311-319.
Jermsittiparsert, K., 2020. Leadership and Industry 4.0 As A Tool to Enhance Organization
Performance: Direct and Indirect Role of Job Satisfaction, Competitive Advantage
and Business Sustainability. In Agile Business Leadership Methods for Industry 4.0.
Emerald Publishing Limited.
Marcolin, F., Vezzetti, E. and Montagna, F., 2017. How to practise Open Innovation today:
what, where, how and why. Creative Industries Journal. 10(3). pp.258-291.
McNulty, J.E., 2017. Some economic aspects of business organization. University of
Pennsylvania Press.
Moreno, S., 2020. Examining the relationship between Observed Global Leadership and
Organizational Behavior Effectiveness (Globe) and job satisfaction, as well as gender
and ethnicity differences in the Globe cultural dimensions, among business
organization leaders (Doctoral dissertation, Our Lady of the Lake University).
Oddy, R.E. and Bason, T., 2017. The first century and beyond: A content analysis of Sport,
Business and Management: An International Journal. Sport, Business and
Management: An International Journal.
Sarantseva, P.A. and Polenova, S.N., 2018. ASSESSMENT OF BUSINESS REPUTATION
OF THE ORGANIZATION. Форум молодых ученых, (11-1), pp.13-16.
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