BMP3002 Business in Practice: Exploring Company Types and Structures

This report provides a comprehensive examination of various company types, including micro, small, medium, and large businesses, detailing their characteristics, operations, and economic impact. It further explores different business structures, ranging from sole traders to cooperatives and limited liability partnerships, highlighting their legal responsibilities and operational dynamics. The report also identifies different organizational structures, such as functional and divisional structures, and analyzes how these structures affect business productivity. Furthermore, it employs PESTLE analysis to assess the impact of external factors, including political, economic, social, technological, legal, and environmental factors, on business performance, emphasizing the importance of adapting to these factors for sustainable growth. Desklib provides access to this and many other solved assignments.

BSc (Hons) Business Management with
Foundation
BMP3002
Business in Practice
Assessment 1
Types of Companies
Submitted by:
Name:
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Contents
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Introduction 2
Section 1: Different types of companies and how they work
P
Section 2: Different companies from sole traders to cooperatives
and Limited Liability Partnerships p
Section 3: Different businesses structures and internal factors
affecting business p
Conclusion p
Reference List p
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Introduction
The aim of this report to examine various types of company and their work
performance aligning with business environment in systematic manner. In this study
it will be discussing about classifications of business with the aid of size as well as
legal entities that includes suitable examples. Apart from this the report will cover
following terms such as business structure, department and functions. It would be
covering PESTLE analysis for business which highlight various external factors
impact over business operations and its functions.
Section 1: Different types of companies and how they work
Micro business:
Micro business refers to form of small business in which there are less than
10 people in total working in organization. The size and scale forms vast
differentiation in terms of micro business and small enterprise. On the other hand
annual estimated turnover ratio in this business is above $25000. In micro business
sectors it has been analysed that most of the business are involved in construction,
social support, retail sectors and health care industries. Moreover, such businesses
are regulated in similar order as formation of other companies and taxation varies on
the type of business. There are various types of business which can be termed as
sole partnership, owner, corporation and LLC (Lim, 2018). Thus, it can be stated that
micro business can be started with smaller capital amount and effective work
performance enable to serves the better quality results.
Small business:
Small businesses are types of firms in which morale support is provided in
industry and nation as well for maximizing the market results. In this type of
enterprise there can be maximum 49 employees who generally help for production of
better market results. Whereas, bunch of small business are operated by sole
owners as each party in accountable for their own profit and loss. The work under
such organization is performed extremely well which aids in gaining higher level of
income sources. Such industries play vital role into development of economic and
success level of country. Owner in this phase make investments into necessitate
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amount of money such as machinery, plant and sectors. The turnover of small
enterprise almost around 5 crores to 75 crores. For all the profit and loss the
individual person seems to be responsible, and he or she can make further decisions
according to their perspectives.
Medium size business:
This is one of the growing business from all other businesses in industry,
there are various job opportunities which is provided for large amount of peoples into
different sectors. It is consisted minimum 100 employees and maximum 499
employees to perform work into reaching to desired goals and targets into
organization. In this stage annual turnover of business rely between 10 million to 1
billion (Karpenko and et.al., 2019). While in centre predicted for approx 2,00,000 US
organization met and accomplish their targets in effective ways. Such business
practices usually focus towards managing assets, income and plays significant role
in economical aspects and majorly contribute to the country developments.
Large size business:
In this type of businesses, it is regulated manufacturing and mining sectors as
it utilize 500 employees to reach up to desirable growth of organization. In small
business production of production is not performed as compared to other business. It
requires around 7 million of annual turnover and large amount of capital is required
for investing into operating companies. Similarly, it offers several employment
opportunities for individual along with getting essential output. Such sectors are
introduced all across world like Russia, Australia, USA, UK and japan. The large
organization provide their support to small and micro business to enhance valuable
market standing as well as economic circumstances of UK. Thus, large size
business serves their practices in effective terms seeking to the all other
perspectives in industry. The competition of such businesses is huge in industry
whereby focusing over essential terms can be crucial to initiate innovative product.
Section 2: Different companies from sole traders to
cooperatives and Limited Liability Partnerships
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Sole trader business:
The sole trader business which is managed by single person who operates as
an entrepreneur and entirely accountable for all purposes. The stakeholder interest
is equal in this type of phase (Fernández, Valle and Pérez-Bustamante, 2021). There
are different aspects of business would be legal responsibilities of sole trader within
business structure. Sole trader are decision makers and execute business activities,
hiring of individual for business operations. In such business owner is concerned as
self- employed who is truly susceptible for business operations, personal assets,
functioning, debts in business processes.
Partnership:
Partnership is the type of business in which there are two or more parties
included in management as well as business operation for sharing the profits
accordingly. There is a formal arrangement whereby parties join legally together for
performing business practices as per sharing of investment in into their business
capital. Moreover, this partnership among two or more parties involves sharing of
profits liabilities on equal basis. In similar way it may differ into varied arrangement
for such business. The appropriate example of partnership business can be
concluded as law firms, group, investments in real states. In this way the owners
have more capital which is available for business. While on the basis of following
measures owners are provided with various benefits, and they are liable to share
their profits accordingly.
Limited liability business:
Limited liability refers to the business structure in which there is combination
of partnership and sole trader business that do not form owner of business liable for
depth and liabilities of organization. There are so many organizations who work with
label of such business as knowing about the concern that they are not liable for any
kind of depth all liabilities in business. It can be said that these corporations are most
considerable in which company structures among entrepreneurs running small
businesses. Thus, it is totally opposite from partnership as such this type of business
it vital in which owners are not liable for any kind of expenses outcomes.
Public limited liability business:
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In public limited business It is designated has limited liability company
organization that usually offers general public shares of stock (Caldera, Desha and
Dawes, 2019). These stocks are of company and the buyer of shares for such stock
in organization have limited liability in which they are not accountable for this sort of
depth or loss of entity. Burberry group, Rolls Royce, Cadbury are suitable example of
public limited company. Limited liability business is the slope in which structures in
this phase is totally based on UK company law as such general public could have
there shares in global leading companies without being level for any kind of loss.
Cooperative:
Cooperative is termed as private business structure in which owners are
termed as service users of organization, and they also control several operations of
company. Such business firms aims to provide fundamental needs of members
whereas members are expected to get through with purpose of accomplishing
activities for capital hike of business organizations. There is a major contribution of
team members who works for fulfilling the essential requirements of business as well
as gaining higher amount of profitability aspects in their respective industries.
Section 3: Different business structures and external
factors affecting business
3.1 Identification of different organizational structures and
explaining how does organisational structure affect business
productivity
Functional structure -
Functional structure refers to business structure in which it organizes entity
into several departments supported with areas of experts. Such departments favour
as functional unit which is usually overseen by managers and departmental heads.
This structure is most significant in company which can be utilized as operating and
monitoring employee performance to define their roles more specifically. The
structure is grounded in business hierarchy level in which there are various divisions
as leaders provide direction to accomplish goals and support in any kind of
difficulties. Functional structure is vital for getting improved operational goals. It also
helps in maximizing the employee efficiency and productivity that is generally
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required in an organization. Whereas in productive terms The structure disappoints
for adoption and creativity marketplace as there are too much job specifications
which also reduce moral of staff members and poor productivity.
Divisional Structure -
In this type of organization structure there are certain aspects which helps to
develop group of individual organization operation and function into various
departments. The division can communicate effectively with both geography and
product. The divisional structure can be useful as failure of individual department do
not impact other department as well as it also create problematic concerns. There
are many departments which consists off demanded resources as well as functions
help full form managing product line and further assistance of better work
performance. The different divided segments can be termed as IT, sales, marketing
finance, production. There is separate management system whereby team members
are access to form decision without taking any kind of approval or suggestion for
their actions. Employees in this face are able to perform speciality of work which
support them enhancing the skills as well as demonstrating talents in company.
Furthermore, it can be stated that the divisional structure do not support productivity
aspects as such it supports direct functional structure as certain economy of scale
have vanished. The major effective outcome of this structure will be favourable for
organization having diverse location an audience.
3.2 How different external factors affect the performance of a
business – PESTLE Analysis
PESTLE analysis is tool which is used to determine external resources and
effect which influences business functions and operations directly. By this framework
it will help to assist analysis for major key aspects like political, economical, social,
technological, legal and environmental concerns. All the above factors are described
as follows:
Political factor -
In this stage it is essential for organization to look further and stay focused
over governmental policies and tactics based on terms through which company need
to take some necessitate decisions or actions to effectively perform their business
practices.
Economic factor -
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This factor is directly influenced through inflation rates, demographic
situations and interest rates, and recession circumstances to business functions
(Painter, Hibbert and Cooper, 2019). In the case when economy decreases then
demand will also reduce which would impact over company's overall growth and
income levels. Such factors are essential for company to increase their stability and
other aspects for long term growth of business.
Social factor -
In this stage company must focus for latest trends being followed in markets
which will allow them to access with developing strong customer base and make
them attentive towards towards products and services. While introducing trendy item
encourages clients that creates positive impact over enhancement of profitability and
growth of respective company. Thus, being socially responsible will also provide
benefits to the company to collaborate and form relations with their customers.
Technological factor -
Organizations can be adaptive with innovative and advanced technological
factors which aids them to improve better quality of service and attract various
buyers. By following the technological concern in most significant way introduce
business to higher level and form better relations with customers.
Legal factor -
It is crucial for business to adopt with legal laws and through this it can be
easier to run business operations fluently. Whereas rules and norms of
governmental are supportive and strictly to be followed that help in directing
business.
Environmental factor -
In this term entity should provide more focus towards formulating products
related to environmental safety which does not create impact over external
environment and nature. In another way business are compulsory to follow all ethical
norms and rules for adequate regulation of activities.
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Conclusion
From the above report it has been summarized that there are different kind of
business like micro, small, medium and large which has been described with their
relevant examples. Also, it has been covered organizational structures which states
their functions in organization. On the other hand PESTLE analysis has been taken
into consideration which reflects to external factors impact over business
performance. In this report it concludes over all type of business formats which is
usually termed as limited liability, cooperative, sole trader, public limited liability and
partnership. It had been discussed about variation in business functions and its
operations on the basis of different formats that are followed by business owners for
day to day activities of their business.
Reference List
Lim, W.M., 2018. What will business-to-business marketers learn from neuro-
marketing? Insights for business marketing practice. Journal of Business-to-
Business Marketing. 25(3). pp.251-259.
Karpenko, L. and et.al., 2019. Formation of the system of fair business practice of
the company under conditions of corporate responsibility. Academy of
Strategic Management Journal. 18(2). pp.1-8.
Fernández, E., Valle, S. and Pérez-Bustamante, G., 2021. Business excellence
practice: efficiency wages versus individual economic incentives. Total
quality management & business excellence. 32(13-14). pp.1532-1547.
Caldera, H.T.S., Desha, C. and Dawes, L., 2019. Evaluating the enablers and
barriers for successful implementation of sustainable business practice in
‘lean’SMEs. Journal of Cleaner Production. 218. pp.575-590.
Ungerman, O. and Dědková, J., 2020. Model of the circular economy and its
application in business practice. Environment, Development and
Sustainability. 22(4). pp.3407-3432.
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Painter, M., Hibbert, S. and Cooper, T., 2019. The development of responsible and
sustainable business practice: Value, mind-sets, business-models. Journal of
Business Ethics. 157(4). pp.885-891.
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