Unit 1 p1 - Describe the Type of Business Purpose and Ownership

UNIT 1
P1 describe the type of business, purpose and ownership of two contrasting businesses
 Organisation 1: Is the business a Sole Trader, Private Limited Company or Public
Limited Company?
In case of organisation 1 the chosen company is John Lewis & Partners which is an employee
owned company which is mainly a Public Limited Company. It is founded in the year 1864 by
John Lewis and its headquarters is located in London, UK. There main motive is to earn profit
and is a profit based organisation.
Organisation 2: This should be a Charity
On the other hand, in case of 2nd Organisation a charity trust is chosen which is Barts
charity. It is a non-profit organisation and they don not pay VAT.
 Is the business in the Primary, Secondary or Tertiary Sector?
 Is the business for profit or not for profit?
 Is the business a retailer or manufacturer?
 Does the business sell products, provide services or both?
 Is the business a national business(only operates in the UK)
Does it operate in Europe as well as the UK
Does it operate internationally as well as the UK
You can find information on a companies ownership type from companies house:
https://beta.companieshouse.gov.uk/
 What are the the features of
Sole Trader:
 What is unlimited liability?
 What personal responsibilities does a sole trader have?
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 How easy or difficult is it to set up?
 What are the restrictions?
 What are the requirements from HMRC?
Partnership:
 What is unlimited liability?
 What personal responsibilities does a sole trader have?
 How easy or difficult is it to set up?
 What are the restrictions?
 What are the requirements from HMRC?
Private Limited Company:
 What is limited liability and why is it a key feature of a Limited
Company?
 What is a legal entity and how does it relate to limited companies?
 What are the requirements for a limited company from HMRC?
 What are the requirements for formation of a limited company?
 Can ownership be transferred publically?
Public LImited Company:
 In addition to what has been mentioned above for Private Limited
Companies, for a Public Limited Company:
 Can ownership be exchanged?...if so how?
 Are these companies big or small?
 What are the requirements to become a Public LImited Company?
 What are the regulatory and reporting requirements of a Public Limited
Company?
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Charity:
 Can they take profits?
 What must they do with the income they make? Are there conditions on
how they can spend money?
 What are trustees?
 What is the situation when it comes to tax?
 What type of liability do charities have?
 Do they have their own legal status?
 Who are The Charity Commission? - why are they important?
P2 describe the different stakeholders who influence the purpose of two contrasting
businesses
Organisation 1: John Lewis & Partners
Business Stakeholders: They are the one who are associated with the profitability as well
as performance of business organisation. Some of the internal and external stakeholders are as
follows:
Customers: They comes under the external environment who highly affects the purpose
of business organisation. Each and every individual have their own perception which can affect
the profitability of business entity.
Employees: They are the one who mainly associated with the organisation and are
internal stakeholder. Employees can affect the purpose of business in both positive as well as
negative manner. If managers provide effective working environment to their staff members they
will positively enhance the productivity of the organisation.
Directors: They comes under the top management authorities of the company and is
associated with the profitability of the organisation.
Suppliers: If suppliers provide raw material according to the requirements of
organisation it will positively affect the purpose of business organisation but on the other hand if
suppliers does not fulfil the requirements of company it will negatively affect the performance of
business organisation.
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Organisation 2: Barts charity
Charity Stakeholders: Just like business stakeholders, charity stakeholders are the one
who is associated with the profitability as well as performance of business organisation. Some of
the charity stakeholders are as follows:
Volunteers: They are the one who work for the trust and charity by their own and provide
various help to the needy people and help in enhancing the living standards of individuals. They
positively as well as negatively affect the purpose of business as they work for the development
of the society.
Trustees: They are the one acts as a legal owner of the assets and are responsible for
handling all the assets which is associated with the charity. They help in taking decisions related
to the trust and affect the purpose in both positive and sometimes in negative manner.
Donors: They are the people provide and donate funds to the trust in order to enhance
their working functionality. If there are ample number of people associated with the charity trust
it will positively affect the purpose and vice versa.
Why is this stakeholder able to influence the organisation?
How does the the stakeholder influence the behaviour of the organisation and the things they do
or don’t do?
P3 describe how two businesses are organised
Organisation 1: John Lewis & Partners
The structure of this business is tall structure, as they have various hierarchical levels of
responsibilities as well as departmental functions. There are different functional areas which has
a director that mainly ensures the long to the medium term direction and guidance of the
department. Apart from this each department has their managers as well as supervisors who have
their duties and responsibilities in order to attain organisational goals and objectives.
Organisation 2: Barts charity
In the present context of Barts Charity it has been analysed that the trust have a Board of
directors as well as 3 or more than 3 volunteers who positively carry out their work in an
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effective manner. Apart from this, the board of director of the trust mainly hires a manager, and
then the manager hires potential and effective paid staff so that they can perform their work
effectively. At the end, it has been analysed that organisational style assist in fulfilling the
purpose in a positive manner as they support them in order to improve the lives of patients’ .
What is the organisational structure?
Is it hierarchical? - what are the benefits of this type of structure and what are the drawbacks
Is it flat? - what are the benefits of this type of structure and what are the drawbacks
How these structures affect communication and the speed of communication?
 What are the channels of communication?
How is the organisation structured on a geographical level?
 Do they have different offices in different countries? - if so what is the benefit of this?
 If they are solely UK based how are they organised around the country? Are they
strategically located in different cities or in different areas of the same city?
How are they organised on a departmental level?
 Do they have a HR department, finance department, marketing department etc.?
P4 explain how their style of organisation helps them to fulfil their purposes.
Organisation 1: John Lewis & Partners
In the present context of John Lewis & Partners, organisational style helps them in order
to attain their organisational goals and objectives in an effective manner. It is a public limited
company perform freely at the marketplace with the main motive of enhancing their profitability
at the competitive market area.
Organisation 2: Barts charity
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On the other hand, in case of Barts Charity there main motive is to provide safety and
security as well as to enhance the lives of patients. They mainly work for non profit motive and
provide various directions in order to raise the living standard of individuals.
What is the benefit of having dedicated, focused and specialised departments? -Is it more
efficient? - if so why?
Are there managers in the hierarchy?
 What is the benefit of having managers that staff report to?
 What is the benefit of having someone who supervises others?
 How is the organisation structured on a store/shop floor level?
What does their style of organisation ( hierarchical/flat) help communication
P5 describe the influence of two contrasting economic environments on business activities
within a selected organisation
Economic Environment 1 and 2 must be Boom and Recession Respectively
Organisation 1: John Lewis & Partners
Boom refers to a stage of business cycle which means a rapid and significant sales of
growth. In the case of Boom it has been analysed that company will increase their production
level according to the requirements of current market. In the present context of John Lewis &
Partners, it has been analysed that with the boom in marketplace company gain various
advantages as well as the profitability as well as good will of the company enhance.
Organisation 2: Barts charity
In the present context of Barts Charity, it has been said that recession plays very essential
role in the overall performance. It is the factor in which country faces significant decline in
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economic stability. This is the factor which highly affects the functionality of charity trust as
they do not have enough donors.
BOOM
 What is a boom?
 How does it affect consumers spending?
 How does it affect employment?
 How does it affect credit lending?
 How does it affect a businesses decision to invest?
 What kind of things would they invest in?
 Would they spend more money? - if so on what sort of things?
 Will they hire more staff?
 Will they advertise more?
 Will they open more stores?
 Will they increase their product range and diversify?
 Will they increase production?
 What will likely happen to their profits?
 Will credit be cheap or expensive? - how will this influence their decision
to borrow or use retained earning?
RECESSION
 What is a recession?
 How does it affect consumers spending?
 How does it affect employment?
 How does it affect credit lending?
 How does it affect a businesses decision to invest?
 What kind of things would do or stop doing and why?
 Would they spend more or less money? - if so on what sort of things?
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P6 describe how political, legal and social factors are impacting upon the business activities
of the selected organisations and their stakeholders
Political factor:
It has been analysed that political factors plays very essential role in the business as
external factors highly influence the business functionality. For instance, if a country where John
Lewis & Partners having unstable government this leads to affect the overall business functions
in a negative manner.
Legal factor:
In context of legal factor it has been identified that each and every country have their own
law and regulations which affects the overall business in both positive as well as negative
manner. For this it is essential for the company to follow the rules and laws in an effective
manner.
Social factor:
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