Business in Practice 1: Analysis of Company Types and Business Forms

This report, titled 'Business in Practice 1', provides a detailed overview of various company types and business forms. It begins by defining a company as a legal entity engaged in business activities to enhance profitability, and then discusses different kinds of companies including micro, small, medium, and large businesses, outlining their characteristics and examples. The report then delves into different forms of companies, such as sole traders, partnerships, limited liability businesses (including public limited liability), and cooperatives, detailing their structures, characteristics, and examples like beauty parlors, NotOnTheHighStreet.com, Oxfam, Barclays PLC, and Central England Cooperative. The report concludes by summarizing the key differences and characteristics of each type, emphasizing how different company structures facilitate business operations and satisfy customer needs through goods and services. The report uses various references to support the analysis.

Business in Practice
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Table of Contents
Introduction...................................................................................................................3
Section 1.......................................................................................................................3
Discuss various kinds of companies and how they work.....................................3
Section 2.......................................................................................................................4
Describe various forms of companies from sole traders to cooperatives and
Limited Liability Partnerships...............................................................................4
Conclusion....................................................................................................................6
Reference List...............................................................................................................8
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Introduction
The term company is defined as the legal entity incorporated in order to
operate and engaged in the business activity and enhance their profitability and
productivity. It is mainly group of individuals working together in order to achieve
desired goals and objectives and enhance overall performance of the company and
satisfying the needs and wants of the customers (Gonias and et. al., 2018). This
report highlights various types of company along with their characteristics also
various forms of companies including their characteristics.
Section 1
Discuss various kinds of companies and how they work
Micro business:
It can be defined as a business firm whose workings and operations are on a very
small scale. This type of business employs up to 10 employees only which includes
the owner as well. This type of business comes under small scale business.
Example: Small farmers, boutiques etc.
Characteristics:
 Requirement to start a micro business is around less that $50000.
 Requires maximum of 10 employees to run the business.
Small business:
This is a type of business which works with less investment in capital and small
workforce on a very small level. The productions of goods and services are on a
small level in this type of business. The role played by small business contributes to
the economic development of a country on a considerable scale (Tkachenko and
Pervukhina, 2020).
Example: Bakeries can be example of small business.
Characteristics:
 The management activities are solely controlled by the owner.
 Small scale business are highly labour-intensive.
Medium size business:
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This can be defined as a business type which are owned privately and its workforce,
capital management and assets are comparatively larger than small business and
smaller than large business respectively (Shahin, Mohamadi and Nazari, 2018).
Example: Captify is one of the example of medium size business.
Characteristics:
 In case of investment in manufacturing sector in plant and machinery should
be more than 5 crores and less than 10 crores.
 While in the case of service sector, the investment should be more than 2
corers and less than 5 crores respectively.
Large size business:
These are those type of business which are involving high level capital investments,
huge infrastructure and huge workforce to run its working. They are majorly working
with a focus of bringing foreign reserves and increasing employment with high level
economic growth of the country as well.
Example: TESCO
Characteristics:
 The play a major role in creating potential opportunities for the small scale
and cottage industries.
 They are involved in producing basic and capital goods.
Section 2
Describe various forms of companies from sole traders to cooperatives
and Limited Liability Partnerships
Sole trader business:
This is type of business or a firm are owned, managed and controlled by a single
person who is called as the sole trader. The same person is the manager as well as
the organizer of the business firm (Saito and et. al., 2020). In such type of business
the owner have no legal identity detached from its owner.
Example: Beauty Parlour etc.
Characteristics:
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 The owner is responsible for all the operations of the business and takes the
charge of all the risk and uncertainties.
 The decision regarding amount of capital investment that is to be made in the
business lies with the owner only.
Partnership:
This is a form of business that can be defined as the relationship between different
persons who are in a agreement to share the profits and losses of the business
(Guimarães and et. al., 2018). The persons entering into partnership are called as
'partners'.
Example: NotOnTheHighStreet.com
Characteristics:
 This type of business works on the basis of an agreement between the
persons who are running the business operations.
 The profits and losses earned are distributed among the partners based on
the agreement.
Limited liability business:
It is a type of business that focuses on the limited liability with a separate legal entity.
It includes aspects of partnerships and companies both. Major offerings from limited
liability companies are protection and flexibility (Gaspar and Leal, 2020).
Example: Oxfam
Characteristics:
 There is no harm to the personal assets of member of the company. They
can be protected from the liquidation.
 The operations of the business can be performed with the presence of only
one member as well.
Public limited liability business:
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It is a type of business which is having a limited liability. It also offers its shares to the
general public. The liability of the buyer who buy shares is limited. These type of
business are majorly listed on the stock exchange. The trading of the shares are
done publicly (Gali and et. al., 2020).
Example: Barclays PLC
Characteristics:
 The legal existence of the company and its member is separate from each
other.
 There is a requirement of minimum seven members with no maximum limit to
form this type of business.
Cooperative:
It is a type of business organization which is owned and operated by a group of
individuals for a mutual benefit. This form of business brings people together in a
democratic manner with an essence of equality. The voting rights are also equally
shared.
Example: Central England Cooperative etc.
Characteristics:
 The existence of such type of organization is voluntary which comes with a
common objective. There is no involvement of coercion or intimidation in such
business format.
 One basic feature of this type of business is that it works on service motive
rather than profit earning & its operations are driven by values (Rojas-Lema
and et. al., 2018) .
Conclusion
From the above report it can be concluded that different types of companies
allows to smoothly carry out their activity and satisfy the needs and wants of the
customers through offering quality goods and services. From this report it is
analysed that there are various types of companies such as micro, small, medium
and large size business as analysed along with their characteristics. Various forms of
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companies such as sole trader, partnership, limited liability, public limited liability and
cooperative along with their characteristic are also analysed in this report.
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Reference List
Gali, N., and et. al., 2020. Social entrepreneurship orientation and company success:
The mediating role of social performance. Technological Forecasting and
Social Change, 160, p.120230.
Gaspar, F. and Leal, F., 2020. A methodology for applying the shop floor
management method for sustaining lean manufacturing tools and
philosophies: a study of an automotive company in Brazil. International
Journal of Lean Six Sigma.
Guimarães, A.G., and et. al., 2018. Co-processing of hazardous waste: The
perception of workers regarding sustainability and health issues in a
Brazilian cement company. Journal of Cleaner Production, 186. pp.313-324.
Rojas-Lema, X.,and et. al., 2018, September. Organizational Structures in Small and
Medium-Sized Enterprises (SMEs) and Their Performance Measurement. In
Engineering Digital Transformation: Proceedings of the 11th International
Conference on Industrial Engineering and Industrial Management (p. 121).
Springer.
Saito, H., and et. al., 2020. Pharmaceutical Company Payments to the Professors of
Orthopaedic Surgery Departments in Japan. JBJS, 102(9). p.e39.
Shahin, A., Mohamadi, D. and Nazari, M., 2018. Prioritising product development
strategies based on supply chain flexibility using multiple attribute decision
making: the case of Esfahan Steel Company. International Journal of
Services and Operations Management, 31(1). pp.77-97.
Tkachenko, I. and Pervukhina, I., 2020. Stakeholder value assessment: Attaining
company-stakeholder relationship synergy. Corporate Governance in Central
Europe and Russia: Framework, Dynamics, and Case Studies from Practice.
p.90.
Gonias, S. L., and et. al., 2018. PAI1 blocks effects of tissue-type plasminogen
activator on cell-signaling and physiology mediated by the NMDA
receptor. Journal of Cell Science.
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