Individual Report: Business Structures, External Factors, and Analysis

This report provides an overview of different types of companies, including micro, small, medium, and large businesses, along with their characteristics and examples. It then delves into various business structures, such as sole traders, partnerships, limited liability businesses, public limited liability businesses, and cooperatives, offering definitions and examples for each. The report further explores organizational structures, identifying different types and explaining their impact on business productivity. Finally, it applies a PESTLE analysis to examine how political, economic, social, technological, legal, and environmental factors affect the performance of a business, using Kingfisher PLC as a case study. The conclusion emphasizes the importance of adapting to external forces for business success.

INDIVIDUAL
REPORT
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Table of Contents
INTRODUCTION ..........................................................................................................................3
Section 1: You are to show an understanding of the different types of companies and how they
work.................................................................................................................................................3
Definition, characteristics and example of micro business, small business, medium size
business and large size business..................................................................................................3
Section 2: You are required to explain different companies from sole traders to cooperatives and
Limited Liability Partnerships. .......................................................................................................5
Definition, characteristics and example of sole trader business, partnership, limited liability
business, public limited liability business and Cooperative........................................................5
Section 3: To consider different business structures and how external factors affect businesses. . 7
Identify different organisational structures and explain how organisational structure affects
business productivity...................................................................................................................7
Using PESTLE analysis explain how different external factors affect the performance of a
business.......................................................................................................................................8
CONCLUSION ...............................................................................................................................9
REFERENCES..............................................................................................................................10
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INTRODUCTION
A business is an activity which includes buying ans selling or certain goods or services
for some consideration from customers to offering firm. Such kind of activity are done with a
purpose of generating revenue or profit or sometimes are conducted fro the purpose of serving
society people at no cost are established just to make charity (Chowdhury, 2013). There are
various kinds of business firms operated in market. Organisations such as Sole proprietor,
Partnership, Limited liability partnership, private company, public company, cooperative and one
person company. Such kind of business firms operates at different level such as micro, small,
medium or large business size. In the present report different forms of business firms are going
to be discussed along with their various characteristics and examples. The all levels of business
are also considered under the report. Further a private company is taken for which organisational
structure and PESTLE analysis is done in report.
Section 1: You are to show an understanding of the different types of
companies and how they work.
Definition, characteristics and example of micro business, small business, medium size business
and large size business.
Every business firms operates in market at a certain level of operation such as micro,
small, medium or large size of business (Dixit, 1997). These type of businesses are classified on
the basis of company's net worth, sales volume, number of employees, capital employed and its
total assets.
The definition, characteristics and example of different level of business is mentioned
below:
Basis of
Comparison
Micro Business Small Business Medium
Business
Large Business
Definition Micro businesses
are those who are
operating at very
small level in
Small business
refers to a type of
firm that runs
with less number
Medium business
are those type of
businesses which
are large than
Large businesses
are those which
operates their
function at
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market. of employees and
does not posses
large sales
volume.
micro or small
but is smaller
than large
businesses.
biggest level and
involves huge
sales and revenue.
Number of
employees
Under micro level
business less than
ten employees
works.
Small business
comprises of
employees
between 10 to 49
in a single
organisation.
Medium size
business is
established by
having employees
ranging from 50
to 249 in a firm.
Large business
are those who
works with more
than 250
employees in an
organisation.
Value of Assets Micro businesses
operates with less
than £113,647.
classification of
business based on
size in london
industry
The value of
assets under small
business ranges
from £13,647 to
£1,134,434.
Medium
businesses
operates their
function with a
assets valued
from £1,134,434
to £3,402,621.
Large size of
businesses are
those who holds
an asset for more
than £3,402,621.
Turnover Micro businesses
carries a turnover
up-to £2 million.
Small business
firm operates with
a turnover that
ranges from £2 to
£10 million.
Such kind of
businesses has a
turnover from £10
to £50 million.
Large business
organisations
carries its
operations with a
turnover of more
than £50 million.
Example Boss Brewing
Company
operates at micro
level of business.
CafePod Coffee
Company runs as
a small size of
business.
Verdant Leisure
comes under the
category of
medium business.
HSBC Bank is
categorized as
large size
business.
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Section 2: You are required to explain different companies from sole traders
to cooperatives and Limited Liability Partnerships.
Definition, characteristics and example of sole trader business, partnership, limited liability
business, public limited liability business and Cooperative.
Every business firm operating in market that is based upon certain type which can be a
sole trader or can be partnership, limited liability or public limited liability or it can be a
cooperative business (García‐Quevedo, Jové‐Llopis and Martínez‐Ros, 2020). Such
classification of business is treated as ownership classified forms of business.
The definition, characteristics and examples of ownership classified business are
mentioned below:
Sole Trader Businesses
Sole trader or sole proprietorship business is one which is owned and being run by a
single person who is a owner of a company (Hernández, Yañez-Araque and Moreno-García,
2020). He is the sole person who enjoys all the profits of business and suffers all kind of losses
occurs if any during course of business. Owner is held responsible for all the liabilities and assets
of the company. Such kind of companies are not mandatory required to get register to registrar of
companies but only requires to register under the category of Self-assessment Tax.
Example- Knight Frank is a sole trading company headquartered in United kingdom deals
in Payroll and Salary management business.
Partnership Business
Partnership refers to a collaboration of two or more persons who comes for some
business purpose with a motive to earn profits and share losses (Ivanovich, 2020). Each partner
under this business is liable equally or according to their profit sharing ratio for liability and
debts. Every partner brings some capital into business and runs in combine. There can be up-to
20 partners in a single firm operating as partnership business.
Example- Mumsnet is a partnership business being founded by two close friends that is
Justine Roberts and Carrie Longton based on UK.
Private Limited Business
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private limited businesses are those which are owned and controlled by a person
privately. The company is not being owned by general public or government officials
(Jurkiewicz and et. al., 1998). Shares of such companies are not bought or further sold by
common people in market. Only board of directors are authorised to buy its shares. The company
has a feature of separate distinct identity then its owners who has a limited scope of liability in
business course. Any single or group of people can setup a private limited company by following
certain mandatory norms prescribed by registrar by submitting various necessary documents to
them. Such businesses are required to put Pvt Ltd. after the name of their organisation. It is the
most common type of business firm that is found in every corner at globe.
Example- Greenergy is a private limited company based on Unite Kingdom deals in
supply an distribution of fuels that are used in transportation.
Public Limited Business
Public Limited business refers to a company that comes under the management and
control of government either central or state. Under such type of business maximum powers are
in the hands of government allotted personal who are company's board of directors (Kuter and
Gurskaya 2020). Public limited company is mandatory required to put PLC after their company
name. Shares of such companies can be bought and further sold by general public who wants
stake in that business. These organisations has a limited liability of public in business as the
name suggests public limited company. The business has a distinct identity then its owners.
Example- Kingfisher Plc is a Public Limited Company based on UK deals in home décor
and furnishing products having more than 78000 employees covering all branches.
Cooperative Business
Cooperative businesses are those which is established by few people who comes together
to share profits and losses for the benefit of all those members who are registered under specific
community (Mayer, 2020).
Example- London Capital Credit Union is a cooperative business established in United
Kingdom as its headquarter.
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Section 3: To consider different business structures and how external factors
affect businesses.
Identify different organisational structures and explain how organisational structure affects
business productivity.
Organisational structure refers to a system that every company follows in their business
that maps various business activities along with a proper channel of communication or
responsibility that is required to be followed by each and every employee of such organisation
(Santoro and et. al., 2020). There are various kind of organisational structure which are used by
business entities in order to have a clear and fair understanding of company's structure. These are
Functional organisational structure, Divisional Organisational structure, Flat organisational
structure and several more.
Each organisational structure is discussed below:
Functional Structure: This kind of organisational structure is based upon various
functions or departments of an organisation such as marketing, finance, human resource,
production, supply chain, etc. which all are necessary in a business to have successful
achievement of target.
Divisional Structure: This type of organisational structure is formulated based upon
teams allotted for each separate task according to a specific project or product which fulfils
customers needs of a particular segment (Trigkas and et. al., 2020).
Flat structure: Under this form of organisational structure there is no hierarchy of
manager or no one is superior to anyone. All employees of an organisation is treated as equal and
can communicate to anyone whenever required.
Kingfisher Plc is a multinational company having its headquarter in United Kingdom
with a dealings in home décor or furnishing products offering its items to more than 1300
physical stores across globe. Kingfisher plc adopts functional organisational structure in its
organisation that is formulated on the basis of company's certain departments that is finance,
marketing, supply chain, human resource, etc.
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Using PESTLE analysis explain how different external factors affect the performance of a
business.
PESTLE is an acronym stands for Political, Economical, Social, Technological, Legal
and Environmental factors that affects the performance of business.
The analysis of PESTEL factors in respect of Kingfisher Plc is done below:
 Political factor: This talks about certain governmental regulations that are necessarly
followed in each organisation (Weiss and et. al., 2002). Kingfisher PLC being a
multinational firm is required to follow political norms of each operating country in order
to sell its products in that country. Every country has their own political norms that
becomes tough to follow all at same time.
 Economical factor: This factor of external environment is concern about country's
development and sustainability issue that is inflation,deflation,employment and other
issues (Wineburg, 2001). Weaker unemployment rate in some operating countries
creates a problem for Kingfisher Plc in hiring competent personal for their company.
 Social factor: This factor is related with concern towards society people related to their
acceptance, preference, etc. It is very necessary for Kingfisher Plc to scan demographics
and culture of society where company is selling its products.
 Technological factor: This factor of external environment is related to technical know
how and various innovations in market. Kingfisher Plc regularly brings innovation in
their offerings which are preferred by their potential customers.
 Legal factor: The factor of external environment talks about legality in business
operations applying which becomes obligation for businesses. Kingfisher Plc is required
to follow various employment or labour laws of each country in which it is operating and
hiring employees.
 Environmental factor: This factor discusses about various issues related to
environmental concern of surroundings, safety of which is the responsibility of each
company (Yao, and et. al., 2019). Kingfisher Plc is always concern about environment
and offers such products that produces less harm to nature such as pollution free items,
etc.
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Negative reaction from any or all of the above discussed forces hinders the business
performance and its profitability. Ignoring or non adopting of nay factor can create a question on
sustainability of business in market because it can lead to loss of brand image or market share.
Positive reaction towards such external forces helps company in achieving success and getting
competitive advantage over firms who deals in same industry.
CONCLUSION
From the present essay it can be concluded that there are various kinds of business which
are classified on the basis of size and ownership. Under the classification of size business firms
have micro, small, medium or large size business. Whereas in ownership category business is
classified as sole trader, partnership, private company, public company or cooperatives. From the
report it is also concluded that there are various types of organisational structure that is followed
in each company which outlines its working structure. External environment such as PESTLE
has a great impact on business performance that can effect either negatively or positively to
business balance sheet and its market image.
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REFERENCES
Books and Journals
Chowdhury, A., 2013. Proprietorship Firms: Advantages and Survival. Available at SSRN
2220979.
Dixit, A., 1997. Power of incentives in private versus public organizations. The American
Economic Review. 87(2) pp.378-382.
García‐Quevedo, J., Jové‐Llopis, E. and Martínez‐Ros, E., 2020. Barriers to the circular
economy in European small and medium‐sized firms. Business Strategy and the
Environment. 29(6). pp.2450-2464.
Hernández, J.P.S.I., Yañez-Araque, B. and Moreno-García, J., 2020. Moderating effect of firm
size on the influence of corporate social responsibility in the economic performance of
micro-, small-and medium-sized enterprises. Technological Forecasting and Social
Change. 151 p.119774.
Ivanovich, K.K., 2020. About some questions of classification of institutional conditions
determining the structure of doing business in Uzbekistan. South Asian Journal of
Marketing & Management Research, 10(5), pp.17-28.
Jurkiewicz and et. al., 1998. Motivation in public and private organizations: A comparative
study. Public productivity & Management review, pp.230-250.
Kuter, M. and Gurskaya, M., 2020, May. Features of Accounting on Household Goods Accounts
in Early Sole Proprietorships. In International Conference on Integrated Science (pp.
164-173). Springer, Cham.
Mayer, C., 2020. Ownership, agency, and trusteeship: an assessment. Oxford Review of
Economic Policy. 36(2). pp.223-240.
Santoro and et. al., 2020. The interplay among entrepreneur, employees, and firm level factors in
explaining SMEs openness: A qualitative micro-foundational approach. Technological
Forecasting and Social Change. 151. p.119820.
Trigkas and et. al., 2020. Business model for developing strategies of forest cooperatives.
Evidence from an emerging business environment in Greece. Journal of Sustainable
Forestry. 39(3). pp.259-282.
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Weiss and et. al., 2002. Making the most of collaboration: exploring the relationship between
partnership synergy and partnership functioning. Health Education & Behavior. 29(6).
pp.683-698.
Wineburg, B., 2001. A limited partnership. Columbia University Press.
Yao, and et. al., 2019. How to reduce carbon emissions of small and medium enterprises (SMEs)
by knowledge sharing in China. Production Planning & Control. 30(10-12). pp.881-
892.
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