Detailed Analysis of Business Classification & Types: Exam 1

This document provides a detailed solution to an exam question focusing on business classification and types. It discusses the main criteria for classifying businesses, including ownership and purpose, and explains different business sizes, such as micro, small, medium, and large, with relevant examples like Miel bakery, Victoria Station Hotel, and Tesco. The solution also defines various business structures, including sole traders (e.g., A&W), partnerships (e.g., John Lewis), private limited liability companies (e.g., River Island), public limited liability companies (e.g., Marks & Spencer), and cooperatives, outlining their characteristics and providing examples. The document further elaborates on the features of each type, such as risk management in partnerships and the voluntary nature of cooperatives. Desklib offers a wide range of study resources, including past papers and solved assignments, to support students in their academic endeavors.

1 - exam
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TABLE OF CONTENT
MAIN BODY..................................................................................................................................3
TASK 1............................................................................................................................................3
1. Discussing the main criteria used for classifying different kind of businesses?.....................3
2. Explaining microbusiness with appropriate examples:...........................................................3
3. Explaining small business with appropriate examples:...........................................................4
4. Explaining medium size business with appropriate examples:...............................................5
5. Explaining large size business with appropriate examples:....................................................5
TASK 2............................................................................................................................................6
1- Defining sole trader business with an example and characteristics?.......................................6
2- Defining partnership with example and their features?...........................................................6
3- Explaining private limited liability business with an example and characteristics?...............7
4- Defining public limited liability business with an example and features?..............................7
5 Defining cooperative with appropriate examples. Briefly explaining three main
characteristics of a cooperative:...................................................................................................7
REFERENCES................................................................................................................................9
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MAIN BODY
TASK 1
1. Discussing the main criteria used for classifying different kind of businesses?
Every business organization fall under a specific criteria which keep firm different and
unique from each other, classification of business can be done with the help of two main criteria,
these are:
Ownership: This is one of the most important type of criteria allowing each business to fall
apart, different kind of business means different ownership. For example; a sole trader is sole
owner of the firm allowing him to take all profit of the company and bear losses as well whereas
in partnership, ownership remain in the hands of two or more people (Allen, Kraakman and
Khanna, 2021). ownership is one of the most common type of criteria that can be used to classify
different kind of business. Ownership determine whether business is in the hand of sole
personality or run by partners to divide profit as per the agreement.
Purpose: This is another common but most important type of criteria which can be used for
classification of different kind of business. For example; a firm might work to generate surplus
profit for private use including expansion, working capital and other firm purpose whereas an
charitable business will donate their profit to donation house and other area. kind of business is
differentiated with the help of profit sharing process, if business donate then they classify as
charitable organization.
2. Explaining microbusiness with appropriate examples:
Micro businesses are some of the most common but important element of the economy,
they contribute billons to GDP allowing country to stay stable. Micro businesses are small corner
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shop, vendor, general store, affordable street food stall and even small local business. Micro
business are small enough, these business run in street and have great impact on locality. These
shops are run by sole trader or family with small area, street shops are consider as best example
of micro businesses (Cappellino, 2020). Micro business have almost every type of product, but
they are not manufactured by them, these products are sold by micro businesses in local area
allowing customer to become habitual to these corner shop. Some of the best example in London
are:
 Miel bakery: This is one of the most famous micro business of London provide all type
of cake and food products, this bakery is small business but have great impact on locality
and customer who prefer taste.
 General store: These are available all over the London with wide range of product that
are used by customer for daily purpose including food items, cleaning items and other
products. General store are some of the best example of micro business.
3. Explaining small business with appropriate examples:
Small business are above micro business, these are those business with stable profitability
ratio and have great investment record. Small business are already established firm that have
great brand image and reputation in locality and have stable customer bases (Colovic, 2022).
Small business are great contributor to development of economy, these may include hotels,
restaurant, food item manufacturer, consultancy business, local retailer with own manufacturing
and other small business with heavy impact in buying habit of customer. Small business have
stable income, these business slowly grow and directly convert them into large scale business
firm with brand image and reputation. Some of the most appropriate example are:
 Small retailer: Small retailers are some of the best example of small business, they have
their own manufacturing but focus on including other brand as well, these small retailer have
higher impact on customer in locality. For example Crane and Kind is one of the best
example of small business in London.
 Hotel business: This is one of the most common type of small business, small hotel or
locality accommodation are small business that have great impact on international and local
tourist. For example; Victoria station hotel is one of the best example which is small
business located in London.
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4. Explaining medium size business with appropriate examples:
Medium size business are not common, these business are found to be most important in the
economic development. Medium size business are small manufacturing unit that have their own
production and unit capacity, medium business fall in growth process of small business. Medium
business are close to become large scale enterprise because revenue of 25 million euros to even
more than 500 million euros, these business have huge contribution to economy (Staiculescu and
Sandu, 2016). There are some example of medium scale business, these are:
 Healthcare organization: Local health organization are some of the best example for
medium scale business, some health care organization even have their own
manufacturing unit producing medicine and health care products. For example; Crawford
Health care medium size health organization with own medicine manufacture.
 Manufacturing business: This is one of the most common type allowing business to be
different from each other, medium scale business have manufacturing unit and cover
medium scale demand of customer. For example; Harvey Water Softener is one of the
medium scale business that manufacture water softener.
5. Explaining large size business with appropriate examples:
Large scale business organization have brand image and reputation, these business have
great impact on economy. Large scale businesses are heavy industries with large scale
manufacturing unit and production, these business have impact on customer and even capture
market position with wide range of product. Revenue of these businesses all in the area of
billons, large scale business are established in different countries as well. There are some
example of large scale business organization, these are:
 Retail brand: Retail manufacturing company or consumer goods company are some of
the best example of large scale business. For example; Tesco is one of the largest retailer
in the UK with wide range of product and brand image all over the world.
 Consultancy brand: Consultancy brand are large scale business organization that have
brand image all over the world and have greater marker share as compared to any other
type of business firm. For example; KPMG is large scale business unit with professional
business consultancy all over the world.
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TASK 2
1- Defining sole trader business with an example and characteristics?
Sole trader is defined as simple business structure that has followed by varied companies,
either public or private, for purpose of running their ventures independently, instead of
depending on other stakeholders or partners. This category of businesses is entitled to keep
overall profits and success after taxes and other things had done (Pagura, 2021). A&W is the
best example of sole trader venture, as it run its business separately, without taking initiative to
become a partner of an organization.
The best thing about sole trader venture is good control of power that only owner have and
capability to utilize that appropriately. As a sole trader, they may have power to take decision,
and implement the same into practical manner. They may recognize in the market as independent
venture runner, who may take action to grow and succeed without taking too much time to do so.
Along with that, an entrepreneur may have opportunity to take pleasure of using unlimited
liability and get continuity to grow. They may take benefit of working alone, instead of others
engagement who may create.
2- Defining partnership with example and their features?
A partnership venture is one of those companies that are consisting of two or more
ventures who are accountable to work with each other, by conducting ethical and sustainable
practices. John Lewis is an example of partnership company that work with Waitrose, in
appropriate and ethical manner, for purpose of gaining profitability and building excellent brand
image, which is quite essential for both of them (Ramani, 2022). Existence of an agreement is
the key characteristic of partnership business which may drive the attention of entrepreneur
towards obtaining desired outcomes in the form of increasing customer base and in increasing
their satisfactory level. Another feature of partnership business is risk management as both
partners by conducting ethical and appropriate practises and developing mutual understanding
me create a strategy which give them power to handle risk whether it is big or not. The last and
the most important benefit of a partnership is investment scope when two companies work
together they have a vast area for investment that in return provide them desire outcomes, which
is not that easy for any company to do that.
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3- Explaining private limited liability business with an example and characteristics?
An organisation that operates their business by working in a private sector is known as
Private Limited liability organisations. This type of business may have liability of a member of a
private limited company is me limit to amount of shares respectively held by individual. This
type of ventures may have liability in limited manner related to their share. River Island is the
best company that run venture under the category of LTD. Paid up capital, minimum
subscription and prospectus are the key features of private limited liability organization, that
pleasure may each stakeholder take for longer.
4- Defining public limited liability business with an example and features?
Public limited liability companies offered shares of stock to locals and the buyers of these
shares may have limited liability. Marks & Spencer is an example of PLC that run its venture
appropriate for purpose of enhancing customer satisfaction. Easy transferability, separate legal
entity and limited liability are the main features of these forms of companies.
5 Defining cooperative with appropriate examples. Briefly explaining three main characteristics
of a cooperative:
Cooperative are owned and run by member including member from government as well, this is
joint business firm work corporately with each other to achieve business growth and continuous
success. Cooperative business are managed by board of director with different power and interest
in the society. For example; insurance company that have joint working with private investor and
even government for profit making purpose allowing every party to be wealthy (Wood and
Logsdon, 2017). There are three main characteristic o cooperative, these are:
 Voluntary organization: Cooperative are voluntary organization with basic management
structure and poor control.
 Absence of leadership: Cooperative organization lack in leadership impacting their
stability in highly competitive market area.
 Membership process: If any private individual or business want to work together or
under cooperative then membership will be needed in the process of cooperative firm.
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REFERENCES
Books and journals
Allen, W.T., Kraakman, R. and Khanna, V.S., 2021. Commentaries and cases on the law of
business organization. Wolters Kluwer.
Cappellino, A., 2020. How to Choose the Right Business Organization Form.
Colovic, A., 2022. Leadership and business model innovation in late internationalizing
SMEs. Long Range Planning, 55(1), p.102083.
Pagura, I., 2021. Law report: The company: An alternative business structure. Journal of the
Australian Traditional-Medicine Society. 27(3). pp.156-157.
Ramani, S., 2022. A Learning Mindset Needed from Faculty in Online Program Management
and University Partnership Business Model. Electronic Journal of e-Learning. 20(2). pp.pp134-
150.
Staiculescu, O. and Sandu, A., 2016. Can Social Responsability Be A Kind Of Business?. Annals
of'Constantin Brancusi'University of Targu-Jiu. Economy Series, (2).
Wood, D.J. and Logsdon, J.M., 2017. Theorising business citizenship. In Perspectives on
corporate citizenship (pp. 83-103). Routledge.
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