BMP3002: Business Structures, Types, and External Factor Analysis

This report provides a comprehensive overview of different company types, ranging from micro-businesses to large corporations, and analyzes various business structures, including sole proprietorships, partnerships, limited liability companies, and cooperatives. It discusses the characteristics of each type and how they operate. The report also identifies different organizational structures and explains how they influence business, highlighting the importance of aligning structure with business size and objectives. Furthermore, it examines the impact of external factors on business performance using PESTLE analysis, covering political, economic, social, technological, legal, and environmental influences. The report emphasizes the need for companies to understand and manage these factors to ensure sustainable growth and success. Desklib provides access to similar solved assignments and study resources for students.

Business Management with Foundation
BMP3002
Business in Practice
Assessment 1
Types of Companies
Submitted by:
Name:
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Contents
Introduction 2
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Section 1: Different types of companies and how they work
P
Section 2: Different companies from sole traders to cooperatives
and Limited Liability Partnerships p
Section 3: Different businesses structures and internal factors
affecting business p
Conclusion p
Reference List p
Introduction
Companies are basically prepared by the knowledge of various factors and it
is prepared for profit and revenue generate. Almost every company has different
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shape, size according to the power of investment product and services and it is
group of multiple things which develop new things for country economic
development as well as individual growth. Development of organization is difficult
task when the business owner have lack of knowledge that which thing is beneficial
for new industry evolution (Schallmo, Williams and Boardman, 2020). This report will
show that the only lack of knowledge is not single problem for the company, the
external factors are directly affects whole company performance and every company
has different rules, techniques and the verity of new things. Also, this report will
provide idea about different companies provides investment ideas for customer.
Section 1: Different types of companies and how they work
Micro business:
A microbusiness is a tiny enterpise that work on a very small scale. Have less than
ten employees, together with the owner. Have revenues of less than $250,000
(Aschemann-Witzel and et.al 2017). The term micro business is frequently used to
refer to a tiny, typically, valid business that is not backed by micro credit.
Informed about what distinguishes tiny business owners from the competition
will assist to determine the strengths and how to apply them to the company's
benefit. Important characteristics are,
Confidence: known to the best abilities and biggest areas for progress as a
confident small business owners. Business aim becomes much easier by having
confidence.
1)Goal-oriented: To understand what customers expect from company and devise a
strategy to attain those objectives. To keep firm on track for success, one must be
energetic to reach goal.
Small business:
A small business is a personal deatined agency, association, or free holders with the
fewer workers and yearly income than a business firm or a regular-sized business.
The definition of 'small' business in phrase of being capable to ask for authority
assistance and standard for tax plans varies by country and industry. These
industries play a critical part in a country's economic evolution (Obschonka, and
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Stuetzer, 2017). The individual either makes a one-time investment in appliances,
manufacturing and herbs, or rents or appoint them. These do not spend more than a
crore in business. Many successful small business owners leave secure careers to
pursue their dreams, this is example of their willingness to take chances. Another
option is to invest their own money, knowing that a return is unlikely. Its
characteristics include the following:
1)Freeholder ship: Known as sole property as it has only one owner.
2)Administration: managed works are controlled by the owner.
3)Small-scale: They have particular area in which they function. Includes local shops
or company located in one field.
4)Elasticity: Businesses are small, so they are not shut and are flexible to few
changes, unlike big industries.
Medium size business:
They might be family holders and controlled companies, but due to their scale, they
could also be complicated enterprises with takeover and management separated
(Buffa, Franch, and Rizio, 2018). Average sized enterprises are typically wide spread
and have a proven route record, making it easier for lenders and capitalists to make
financing choices. They are typically developed companies who function in mature
markets, but they may also work in high-level markets or be looking to relocate from
a mature market to one with greater growth and prospective. Characteristics of
medium-sized business:
1)Be ready for hard work: It needs more time to work in medium size business.
Individual should be able to maintain his record in order to work more hours on
demand.
2)Be ardent to work in what ever situation comers: The attitude of never giving up to
any kind of situation can rise up the business in speed. To believe in the work
should be ones first priority.
Large size business:
Large firms, in general are those that employ 500 or many people in the mining and
the making industries, or that do not create products but have an annual revenue of
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$7 million or more. Large business is one that surpasses the pre mentioned
employee and income approach (Barricelli, Casiraghi, and Fogli, 2019). In United
Kingdom, large firms employ 40% of the workforce, In the terms of finances, a huge
company also offers more options. Its characteristics include:
1)Straight vision: Organization should have clear vision to reach their goal. Maintain
good ideas make in use for further assistance.
2)Business strategy: Having a plan on how to make the business successful by
writing up the detailed business plans, marketing strategy etc., company should per-
plan that what they should achieve in next coming days.
3)Having aims: Most successful businesses are those who are working for their aim.
It is important in the growth of the company and enhancing the performances every
day.
Section 2: Different companies from sole traders to
cooperatives and Limited Liability Partnerships
Sole trader business:
Business is handled and run by only sine single person is known as sole trader
business (Ahmad, Azhar, and Chowdhury, 2019). Its characteristics include:
1)Single person ownership: singles person owns the whole business. Gives the
needed capital and is the manager of own business.
2)Speedy decision-making and freedom: working alone does not need to report or
ask for anything to anyone. Self decisions are made without taking time.
3) Gets all profit: Work is been done by the individual alone and profit is been gained
by the owner alone.
Examples: wire man, fitters, tailor, gardeners etc. are its examples. These are all
classic trade enterprises. These are all classic jobs that are simple for qualified
artisan to handle. They will mostly focus on word-of-mouth selling and interior work.
Partnership:
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A partnership is a legally binding agreement between two or more people to handle
and run a business while mutuality profits (Theobald, and et.al 2018) characteristics of
partnership are below:
1)have agreement: Business is owned by two or more people and revenue is
equally distributed among both, which is all written and kept with all the two
members.
2)Profit sharing: whatever profit and loss occurs in a business is been appreciated
by all the two members and amount which is earned is equally given to both.
Examples: all partners share equal liability and amounts that is earned, although in
other business, partners may have restricted liability. The collaboration between any
two companies like Go Pro and red bull is an example of partnership both are
lifestyle brands with same compared things.
Limited liability business:
Limited liability in company refers to limiting the private financial hazard. The amount
of money the company is responsible for if the business disappointments is
controlled by business structure (Siffel, and et. Al 2021). Its characteristics include the
following:
1)Separate legal existence: An LLC's legal personality is distinct from that of its
businessman, or associates. In the case of an independent partnership, the owners
own belongings and incur debt as a group of people.
2)Elasticity in taxation: In terms of taxation, LLC's provide a lot of flexibility. LLCs are
not treated as distinct tax entities by the IRS.
Examples: an LLC combines the benefits of a partnership pass through taxation with
limited liability of a corporation. Anheuser-Busch, Blockbuster etc are examples of
LLC.
Public limited liability business:
This type of organization where business is run by tow or more individuals.
Organization or company generate shares in market to the public, they have limited
liability stock of shares. It depends on the particular period that when the company
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has good amount. Recently people are more attract on investment like mutual funds,
professional traders, and many more for generate the profit. This type of
organization mostly provide shares for short time with the good amount.
Cooperative:
The mutual understand between the owner and their members, which means
the individual collect and invest their money in bank because this is safe term that
people can easily generate profit and collect the money for long term. Voluntary and
open membership which means cooperative are open thing where individual how
are capable to use services. Members are independent for the controlling on the
organization according to their requirement (Fouad and et.al., 2020). This is the best
thing which is developed by the organization for develop surplus.
Section 3: Different business structures and external
factors affecting business
3.1Identification of different organizational structures and explaining
how does
Organization has different shape, size, structure and products. It is necessary
when any individual prepare new business structure they should know about various
aspect which reflects the size of business. Basically according to the size or
structure of the company, it will decide that which law, regulation, terms and
condition are essential to follow for legal business evolution. Business is the
progressive process, it means when the individual develop any business they
prepare business according top their investment position. Every business
productivity are affects from various aspect but the only thing is effective
management can develop the business stricture in efficient way. Attractive
organization structure is creates by multiple things like knowledgeable employee
engagement, human resource, raw material, unique product and services and many
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more. Legal rules is the most essential things for better business. Simple, multi
divisional, large, medium, small various type of organization structure are prepared
by individual or by partners. Different size of business have different term which
affect the organization productivity, so basically every business has different
problems which affects the productivity of company (Yang-Ngam, Chankoson and
Aodton, 2019).
Simple structure which means there is no formal system which is follows by
the employee or worker, and they have limited group of people, and they maintain
daily task productivity. Second one is Functional structure where employees are
divide into the department, this system is proper uniform where individual has
performed with team which means human resource department, marketing
department, production and services and many more mostly this structure is follows
by large size of business.
Third one is multi divisional structure where company prepare different
product and according to the number of products management prepares different
department. Fourth and last one the matrix structure which means the business is
engaged for limited time is mainly affects the productivity because of the fast
changes.
3.2 How different external factors affect the performance of a
business – PESTLE Analysis
External forces are directly affects the overall business performance. It is
essential that company can manage so many aspects which are affects the
business productivity and also its essential that company has to know about macro
factors. External factors are as follows,
The first factor is political factors are directly impacts by the changes in
government rules, laws, regulations. It will impact on the profit and development of
new opportunities. Differentiation in law directly impacts the production and human
resource activity.
Next one is Economic factors it includes that inflation rate, exchanges in
product rate, consumer buying power and many more things are affects the
organization growth and their expansion. Management of external factors is not an
easier task because it has so many aspects that company not consider each one
from it.
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Social factors the behavior and changes in cultural activities, attributes,
individual thought, perception etc are the part of this factor which influence the
business performance. So company has to consider that knowledge of social
cultural behavior, so they can manage their productivity (Alshmrani, 2021).
Technological forces which comes from innovation, according to recent
trends technology is the biggest challenge that company has to manage because of
survive in the competitive market, it is important term that company has to know
about new technology for effective development of new opportunities in the
business.
Environmental forces impacts arise from the changes in weather,
temperature, pollution and many more. Company faces so many issues from the
unwanted changes in environment, because his unwanted changes are directly
affect the sales and profit.
The last factor which is legal force that means government laws policies,
working hour laws, property laws, diversification in the policies influence the
organization new approach because every organization wants to achieve more
success that is the reason businesses are not developed new things and chance in
the organization.
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Conclusion
It has been summarized form the above study that how organization or
companies can effectively generate profit and beneficial for customer investment,
and the development of new opportunities faced so many difficulties from the
external forces. Also, it has been identified that how different companies work in
environment with the knowledge of effective techniques and proper knowledge of
macro, small, medium, large business that how many people work in every size of
business, which techniques they apply, How they work effectively, how they
generate profit, new opportunity development in different size of business. It has
been clear that every organization structure impacts from external forces, and they
face many challenges survive in the large market, the knowledge of macro
environment forces are important aspect.
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References
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business models—best practice, enablers, and roadmap. Digital
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Fouad, M. M., and et.al., 2020. Dynamic group-based cooperative optimization
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Yang-Ngam, C., Chankoson, T. and Aodton, P., 2019. Influence of internal and
external factors on supply chain information system risk management
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Alshmrani, E. H. M., 2021. An analytical view of Amazon success in the
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Barricelli, B.R., Casiraghi, E. and Fogli, D., 2019. A survey on digital twin:
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Ahmad, I., Azhar, N. and Chowdhury, A., 2019. Enhancement of IPD characteristics
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Theobald, S., and et.al 2018. Implementation research: new imperatives and
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