An Analysis of Various Company Types, Structures, and External Factors

This report provides an analysis of various types of companies, including micro, small, medium, and large businesses, detailing their characteristics and operational scales. It further explores different company structures such as sole traders, partnerships (general and limited liability), public limited liability companies, and cooperatives, highlighting their legal and operational distinctions. The report also examines the impact of organizational structures, specifically functional and divisional structures, on business productivity. Additionally, it discusses how external factors, analyzed through a PESTLE framework, influence business performance by identifying opportunities, developing alertness to threats, and fostering a deeper understanding of market dynamics, emphasizing cost-effectiveness as a key benefit of this analytical approach. The conclusion summarizes the importance of effective management practices, organizational structures, and external factor analysis for achieving business objectives and capitalizing on market opportunities.

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BMP3002
Business in Practice
Assessment 1
Types of Companies

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Contents
Introduction 2
Section 1: Different types of companies and how they work
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Section 2: Different companies from sole traders to cooperatives
and Limited Liability Partnerships 3
Section 3: Different businesses structures and internal factors
affecting business 5
Conclusion 7
Reference List 8

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Introduction
Execution of new methods and technologies in the daily routine and procedures of performing
business operations which include setting up various databases for best practices introducing
management systems for improving retention of employees. In simple words it can be said that
the business practices refers to the human experience and skills which are required for
delivering a service repeatedly. Basically it is a group of guidelines ideas for ethics which
percent the most efficient course of action in a specific situation of business. The purpose of
making this report is to analyzing the various types of companies and how they work. Second
section of this report shows the various companies from solar traders to Cooperative and
limited liability partnerships. Along with this it also shows the various structures of
organization and how the external factors of a business organization affect its performance.
Section 1: Different types of companies and how they work
Below mentioned are the various types of companies which are divided on the basis of their
scale of operation which include annual turnover and number of employees working in the
organization:
Micro business:
This type of business can be explained on the basis of employees and turnover. This type of
business glued it and working employees in the organization and it is necessary to have their
annual turnover less than £2 million (£1.7 million). Micro business performs the business
operations on a very small scale level for the purpose of earning profit for survival of life. This
type of business plays an important role in the economy of United Kingdom (Latukha, M.O.,
2018).
Small business:
This type of business can also be said as a privately owned corporation which includes
the involvement of more than 10 employees and less than 50. The annual turnover for small
business is a more than £2 million but always less than £10 million. Small cafes restaurants are
the various examples of small business and this business is owned by a single person who
perform all the activity is a of organization. It requires large amount of capital investment as
compared to micro business.
Medium size business:
After gaining a growth in small business it becomes a medium sized business as it include the
involvement of more than 50 employees but less than 250 employees (McLeod, S. and Curtis,

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C., 2020). A large amount of capital is required in such business is as compared to small
business for stop it works as a bridge between small business and large size business. Along
with this it is also analyzed at such type of business include the annual turnover of more than
£10 million and less than £50 million.
Large size business:
Such types of a business include a huge amount of investment or capital. This type of business
do operations on a very large scale level which include the involvement of more than 250
employees and the annual turnover of this business must be more than £50 million (Khan,
M.A., 2019). While starting a larger size business it is necessary to have proper source of
capital which can provide the sufficient amount of Finance to the organization for the purpose
of starting the business operations in the organization.
Section 2: Different companies from sole traders to
cooperatives and Limited Liability Partnerships
Sole trader business:
Such type of business organizations are owned by a single person who perform all the
functions and operations of an organization. The person who performs all the functions of the
business is known as a sole trader or sole proprietor (Rana, G. and Sharma, R., 2019). Such
type of business is off has no separate legal entity. Local grocery stores are handled by a
person, is an example of solo trade business. In simple words this business can be said as a one
man business.
Partnership:
It can be defined a business which establish a relationship on the basis of law and this
relationship is a made through a written agreement between two or more people or companies.
In partnership, two or more people or companies make an agreement of investing money
together in the business for the purpose of sharing profit and losses in such part (Keys, B. and
Shapiro, S., 2019). General partnership, limited liability partnership, a limited partnership and
many more are the various types of partnership business. All the partner have their unlimited
liability.
Limited liability business:
It is another form of business under which the owners of business organization are not

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personally liable for paying liabilities of organization. Type of business includes the features
of both corporations of partnership as well as a solo trade. The members of such business are
restricted to pay limited liability.
Public limited liability business:
Such type of business organizations are registered under the London Stock Exchange. All the
rules and regulations are strictly governed by the laws under this business. Such type of
companies is allowed to collect the finance or capital from public by issuing shares in the
market. Along with this they are restricted to have minimum number of seven members in the
organization. British American tobacco, British petroleum company are the examples of public
limited liability company (Srnicek, N., 2017).
Cooperative:
It is a form of business in which various number of people collected together and work as a
society. Every person is free to join the society (Jacobsen, D., 2017). The membership of
cooperative society is worked as voluntary. Along with this it is also necessary to do the
registration of cooperative society is under cooperative societies act.

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Section 3: Different business structures and external
factors affecting business
Identification of different organizational structures and
explaining how does organizational structure affect business
productivity
Functional structure: most of the companies are using functional structure at their workplace
as it divide the complete Organization in a number of small groups according to the
specialization and functional area. For instance marketing, Finance, HR, IT, Production
department and many more. The organization which are following functional structure at their
workplace hire employees according to the special skills which are required in performing the
task effectively and efficiently. Which type of organization divide the employees on the basis
of skills and qualities that they have? This result in the increase of productivity at workplace
because all the employees working in the organization are clear about their task that what they
have to perform and all the employees have special skills for performing the task in an
effective and efficient manner. This also leads to the reduction of a organizational cost which
day spend on providing training to employees as all the employees are divided into two
functions of departments according to their skills. In simple words it can be seated at it draws a
line roles and responsibility for every employee (Hofman, P.S., Moon, J. and Wu, B., 2017).
The organizations who are following functional structure, hires only skills employees for their
organization as they work effectively and efficiently for the purpose of increasing productivity
as well as productivity of organization which leads to the maximization of profit earning.
Divisional structure: It is the another structure of organization under which complete
organization is divided into groups and every group have their own departments and functional
areas. Different structure of organization gives of huge amount of benefit to the organizations
who are working at various locations because it state separate functional departments to every
group. All the groups are interrelated with head department. The multinational companies who
are doing business in various countries are required to follow divisional structure as they have
to hire employees for their each and every Store or workplace and they have to made all the
functional departments in every organization. It provides a product line which states the roles
and responsibilities of each and every employee of every functional area of all groups. This
structure is not only beneficial for organization as it also give various advantages to the

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Employees as they work on their skills which make them specialized in a particular field.
How different external factors affect the performance of a
business – PESTLE Analysis
Exploit Opportunities: Opportunities always comes under the external factors. Pestel analysis
is a shows the study of external factors which also include the identification of opportunities
which are available in the market (Hearst, T., 2020). It helps in analysing the social and
technological trends. It provides opportunity for making of marketing camping Before any
other competitor do and various approaches also helps the organisation in analysing the various
approaches which provides opportunity to the organisation by converting various users into
their customers before anyone else.
Alertness development: For the purpose of identifying the Organization in a broad sense, for a
specific product aur marketing plan for customer relationships, PESTLE analysis helps the
organization in a rising awareness towards their potential threats. It helps the organization in
developing the premises and alert the organization from the external factors which are going to
convert in challenges for the organization in the near future. By providing alertness to the
organization, it provide time to the management of organization for thinking about the
challenge and finding the solution. In simple words it can be said that it is a alert alarm for
organization as it warns the management from any challenge which is available in the market
as external factor.
Deeper Understanding: PESTLE analysis affective directly as well as indirectly to the
management of organization. It helps the organization in knowing about the advanced
technology and various methods or procedures which are new in the market and their
competitors are applying them in their organizations. It helps in understanding all the various
factors which affect the organization externally. In simple words it can be said that to all the
influential factors which leads to the success or failure of the products and services of an
organization. It also leads to that was a payment of strategic thinking in the management of
organization for the purpose of deeper understanding of strategic planning.
Cost effectiveness: It is a tool which is cost effective in nature as it is not required to invest
money in this process. This process is only done by a few members of organization by doing
research on various factors (Ghosh, N. and Itam, U., 2020). It is required to give proper time
attention while performing this process. As it helps the management of Organization in
analyzing the various factors which affect the management of organization externally.

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Conclusion
From the above report it is concluded that every business organization have to perform
various practices for the purpose of earning profit. It is totally managed by the managers and
leaders of organization so diet the operations should be done in an effective and efficient
manner from the employees and it is necessary to keep an eye on all the activities which are
performed by the employees of organization so that the organizational goals and objectives can
be achieved. For the more it is also analyzed that business is divided in various categories on
the basis of various factors such as investment, employees, liability, objectives and many more.
Also it is found that various organization use different type of organizational structure which
includes functional structure and divisional structure. Every organization is required to follow a
structure so that they can create a line of roles and responsibilities for their employees. It also
helps the employees in working in a good and effective manner. Along with this every
organization want to achieve their objectives and goal along with grabbing all the opportunity
is rich are available in the market by removing all the challenges. PESTLE analysis helps the
organization for the same. It helps the organization in knowing about the various external
factors which helps the Organization in performing the entire task in an effective and efficient
manner and remove all the challenges which are going to face in the future.

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Reference List
Ghosh, N. and Itam, U., 2020. Employee Experience Design: An Innovation for Sustainable
Human Capital Management Practices. In Handbook of Research on Managerial
Practices and Disruptive Innovation in Asia (pp. 110-127). IGI Global.
Hearst, T., 2020. Identification of Critical Investment Practices for Effective Implementation of
Digital Transformation Initiatives (Doctoral dissertation, Capella University).
Hofman, P.S., Moon, J. and Wu, B., 2017. Corporate social responsibility under authoritarian
capitalism: Dynamics and prospects of state-led and society-driven CSR. Business &
Society, 56(5), pp.651-671.
Jacobsen, D., 2017. Tourism enterprises beyond the margins: the relational practices of
Aboriginal and Torres Strait Islander SMEs in remote Australia. Tourism Planning &
Development, 14(1), pp.31-49.
Keys, B. and Shapiro, S., 2019. Frameworks and Best Practices. In Cyber Resilience of Systems
and Networks (pp. 69-92). Springer, Cham.
Khan, M.A., 2019. Restaurant franchising: Concepts, regulations and practices. Apple
Academic Press.
Latukha, M.O., 2018. Can talent management practices be considered as a basis for sustainable
competitive advantages in emerging‐market firms? Evidence from Russia. Thunderbird
International Business Review, 60(1), pp.69-87.
McLeod, S. and Curtis, C., 2020. Understanding and planning for freight movement in cities:
practices and challenges. Planning Practice & Research, 35(2), pp.201-219.
Rana, G. and Sharma, R., 2019. Emerging human resource management practices in Industry
4.0. Strategic HR Review.
Srnicek, N., 2017. The challenges of platform capitalism: Understanding the logic of a new
business model. Juncture, 23(4), pp.254-257.