Types of Companies, Ownership and Organizational Structure in Business Practice

This report discusses the different types of companies based on size and ownership, as well as the importance of organizational structure in managing business activities. It also covers the impact of PESTEL factors on businesses.

Business and Practice

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Section 1.......................................................................................................................................1
Section 2.......................................................................................................................................2
Section 3.......................................................................................................................................4
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Company refers to a type of Business Organization where there is a group of people
which is working together to attain common Business Goals and Objectives in the future quite
effectively and efficiently in a proper manner (Bocken, Morales and Lehner, 2020). There are
different types of companies and it is quite important that a proper analysis of the companies can
be done in a right manner. This will help in taking the appropriate strategic decisions in a proper
way. In this report, a detailed and specific discussion will be made on the types of companies so
that the management of the needs and requirements can be done.
MAIN BODY
Section 1
There are various types of Businesses which are present. It is necessary to make sure that
a proper and detailed analysis of the Businesses is done. An explanation of the Businesses is as
follows-
Micro Business- These are the Businesses which are quite small in size and therefore
they can be started with a very minimum amount of investment. Therefore, it is quite necessary
that a detailed and proper analysis of these Businesses can be made. The characteristics of Micro
Business in UK are as follows-
 The turnover should not be more than 632000 pounds.
 The Balance Sheet total should not be more than 316000 pounds.
Example- Issoria is an example of a Micro Business. It provides a wide range of consultancy
services to its different types of customers and clients and thus in this way ensures that they are
able to make progress in a proper manner.
Small Business- These are the Businesses which are small in size and they can earn appropriate
level of profits if they can make sure that the appropriate products and services are provided to
the customers. Thus for this particular purpose it is quite essential that the analysis of these
Businesses can be carried out. The characteristics of Small Business in UK are as follows-
 The turnover should not be more than 650000 pounds.
 The Balance Sheet total should not be more than 326000 pounds.
Example- Broadsword Event House is a Business which can be considered as a Small
Business because it is small in size and has been started with low investment. The Business
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makes sure that it is able to provide a wide range of services related with Event Management to
its different customers and clients.
Medium-Sized Business- A Medium-Sized Business is the Business which has been
started with low investment and thus helps in attaining goals and objectives in a proper manner
(Bouwman and et.al., 2020). There are following parameters which are present for this type of
Business-
 The number of employees should be less than 250
 The turnover of the Business should be under 12.9 million pounds
Example- Clarasys is a Medium-Sized Business which provides a wide range of consultancy
services to the different types of customers and clients quite effectively and efficiently.
Therefore, in this way it is able to make sure that it meets out their different types of needs and
requirements which can help them a lot.
Large Business- A Large Business is the Business which has been started by making an
investment with large amount of funds and therefore it is able to make sure that it operates on a
large scale and manage its different types of activities. Therefore the parameters which are there
for defining such type of Business are as follows-
 The number of employees should be more than 250
 These Businesses account for 40% of UK's employment and more than half of turnover
Example- Ceuta Group is a Large-Sized Business which serves different types of clients by
providing a wide range of services to them. Thus, in this way it is able to meet out their essential
needs and requirements.
Therefore, it can be stated that all of these Businesses are able to make sure that they can provide
a wide range of products and services to the customers and clients as per their needs and
requirements (Fernández, Valle and Pérez-Bustamante, 2020). They are important because they
make a sound contribution to the economy of the country.
Section 2
There are different types of companies according to ownership. An explanation of these
companies can be made in the following manner-
Sole Trader Business- A Sole Trader Business is a Business in which there is a single
person who is the owner of the Business (Hermawan and et.al., 2020). Its characteristics are-
 It is run and managed by a single person.
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 The person who is running and managing the Business has unlimited liability
Example- Brick Lane Souvenirs is a Sole Trader Shop in London which provides cool range of
Souvenirs to the people.
Partnership Business- A Partnership Business is a Business in which there are more than 2 or
more partners in the Business. Its characteristics are-
 In it there are minimum 2 people who are present in the Business.
 The partners in the Business make use of a particular Profit-Sharing Ratio so that they are
able to share the profits of the Business.
Example- Goetz & Partners is a Partnership Firm in London which provides Business
Management Consultancy Services to the customers and clients.
Limited Liability Partnership- A Limited Liability Partnership is a Business in which the
different partners have a limited liability. Its characteristics are-
 There is a limited liability of the members in such type of partnership.
 These Businesses are formed for the purpose of earning profits only.
Example- White & Case LLP is a Law Firm in London which provides its services to the
customers and clients.
Public Limited Company- It is a voluntary association of members having a separate existence
and the liability of its members is limited in nature. They are listed on the stock exchange where
the shares/stocks of the company are traded publicly. Its characteristics are-
 Separate legal existence from the members.
 There is a limited liability of the members.
Example- Grainger PLC is a Property Management Company which makes sure that it provides
its services to the customers and clients.
Cooperative Society- A Cooperative Society is an association of people where the main purpose
is to make sure that the appropriate services are provided to the society and therefore this helps
in making a contribution to the society (Kantabutra, 2020). Its characteristics are-
 It is a voluntary association.
 It has a separate legal entity.
Example- CDS Co-operatives is a Housing Association which provides its services to the
customers and clients and therefore ensures that their needs and requirements can be met.
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Thus, it can be stated that there are various forms of Businesses according to their ownership.
Therefore, it can be said that these Businesses are able to manage out their various types of needs
and requirements quite effectively and efficiently. Thus, the selection of the form of ownership
has to be done after considering the impact and influence of the different types of factors which
will thus help in ensuring that the attainment of the future goals and objectives can be done in a
proper manner. Thus the selection of the right form of ownership becomes quite important for
the Business and should be done in a proper way.
Section 3
Organizational Structure refers to a form of structure where the management of the
organizations can be done in such a manner so that the organizations are able to manage their
different business activities (Schallmo, Williams and Boardman, 2020). Therefore, it can be
stated that using this type of structure can help in ensuring that the Business Organizations are
able to manage their activities. This can thus help them in attaining their goals and objectives in
the future in a proper manner. The types of organizational structure are as follows-
 Functional Organizational Structure- Here, the division of the activities in the
Businesses is done according to the various types of Functions. Thus, Functional Units
are created here.
 Divisional Organizational Structure- Here, the divisions are created for the Businesses
which can help them a lot. Therefore, it can be stated that in this way the Businesses can
manage their needs and requirements quite appropriately.
 Flatarchy Structure- Here the flattening of the hierarchy is done and therefore in this
way it can be stated that the higher speed of implementation can be ensured when its use
is made effectively and efficiently by the organizations.
 Matrix Structure- Here the different types of matrices are created and therefore in this
manner the employees are spread in the organization. Therefore, in this way it is helpful
in ensuring that the needs and requirements are managed quite appropriately.
Organizational Structure is quite important because it creates a particular level of impact
on the Business Productivity. It is thus essential that the way in which it can be used is identified
so that the better management of the different types of functions within the organization can be
carried out so that the enhancement in the efficiency and effectiveness level can be done which
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will thus lead towards the attainment of the overall goals and objectives in the future in a right
manner.
For the analysis of the macro environment of a Business Organization the use of a PESTEL
analysis can be done (Vos and Page, 2020). The explanation of the factors in the Macro
Environment can be made in the following manner-
 Political factors- These factors create an impact on the Businesses because the political
conditions can change quite quickly and therefore can create a particular level of impact
on the organizations.
 Economic factors- These factors can create an impact on the Businesses because there
can be a change in the economic conditions of a country which can thus create an impact
on the Businesses.
 Social factors- These factors are important for the Businesses because the Businesses are
required to make sure that social needs and requirements of the customers should be
considered which will thus help in ensuring that the attainment of the goals and
objectives can be done.
 Technological factors- These factors are also crucial for the Businesses because they are
required to ensure that the changes in the technology are taken into account by them
which will thus help them in managing out their particular level of needs and
requirements in a proper manner.
 Environmental factors- These factors are important for the Businesses because the
environment can change quite quickly and therefore this will be essential for them in
ensuring that the products and services are provided according to the environmental rules
and regulations.
 Legal factors- These factors are important for the organizations because the legal rules
and regulations are required to be considered by them. Therefore, it is important that the
Businesses adjust themselves accordingly and can attain the goals and objectives in the
future.
CONCLUSION
From the above report, it can be concluded Company is a Business Organization which is
formed by a group of people. There are different types of Businesses according to size. The
Businesses can be segregated on the basis of ownership as well. The organizational structure is
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important in ensuring that the organizations are able to manage their activities properly. The
analysis of PESTEL factors is crucial for ensuring that the impact of these factors on the
Businesses can be assessed which will thus help in taking the right decisions and therefore the
goals and objectives can be attained in the future.
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REFERENCES
Books and Journals:
Bocken, N., Morales, L. S. and Lehner, M., 2020. Sufficiency business strategies in the food
industry—the case of Oatly. Sustainability. 12(3). p.824.
Bouwman, H. and et.al., 2020. Business model tooling: where research and practice meet.
Electronic Markets. 30. pp.413-419.
Fernández, E., Valle, S. and Pérez-Bustamante, G., 2020. Business excellence practice:
efficiency wages versus individual economic incentives. Total Quality Management &
Business Excellence. pp.1-16.
Hermawan, M. D. and et.al., 2020. Family Business Marketing Practice: A Case Study in the
Times of Covid-19. International Journal of Management. 11(6).
Kantabutra, S., 2020. From philosophy to business practice. In Sufficiency Thinking (pp. 216-
232). Routledge.
Schallmo, D., Williams, C. A. and Boardman, L., 2020. Digital transformation of business
models—best practice, enablers, and roadmap. Digital Disruptive Innovation. pp.119-
138.
Vos, L. and Page, S. J., 2020. Marketization, Performative Environments, and the Impact of
Organizational Climate on Teaching Practice in Business Schools. Academy of
Management Learning & Education. 19(1). pp.59-80.
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