Business Structures, Analysis of ASDA: A Comprehensive Report

This report provides a comprehensive overview of different types of business structures, including profit, non-profit, and non-governmental organizations (NGOs). It explores various legal structures such as sole proprietorships, partnerships, and limited companies, detailing their characteristics, advantages, and disadvantages. The report includes an analysis of ASDA, applying PESTLE, Porter's Five Forces, Value Chain, VRIO, SWOT, and TWOS analyses to evaluate its business environment, competitive position, internal capabilities, and strategic options. The report provides examples of different business types and structures, offering insights into real-world applications and strategic decision-making. Finally, the report provides a detailed comparison between profit, non-profit, and NGO organizations with specific examples, highlighting their scope, legal structure, products, and business objectives.

Running head: DIFFERENT TYPES OF BUSINESS
DIFFERENT TYPES OF BUSINESS
Name of the Student
Name of the University
Author note

1DIFFERENT TYPES OF BUSINESS
Table of Contents
Introduction................................................................................................................................3
ACTIVITY 1(A)........................................................................................................................3
Profit organizations:...............................................................................................................3
Non-profit organizations:.......................................................................................................4
Non-governmental organization:...........................................................................................4
DIFFERNCE BETWEEN PROFIT, NON-PROFIT AND NGO WITH EXAMPLES:.......6
ACTIVITY: 1(B).......................................................................................................................7
Micro enterprises:...................................................................................................................7
Example of micro enterprise: Castle Hill Fire Protection Ltd...............................................7
Small- sized enterprises:........................................................................................................8
Example of small enterprises: Bright star Financial..............................................................8
Medium-sized enterprises:.....................................................................................................8
Example of medium enterprises: Captify...............................................................................8
Sole proprietorship:................................................................................................................9
Example of sole proprietorship: The Accountsmith..............................................................9
Partnership:............................................................................................................................9
Example of partnership: Social Chain..................................................................................10
Limited company:................................................................................................................10
Example of limited company: Iceland.................................................................................10
Relationship between organizational function and objectives:............................................10
ACTIVITY 2............................................................................................................................11

2DIFFERENT TYPES OF BUSINESS
ASDA...................................................................................................................................11
PESTLE analysis:.................................................................................................................11
PORTER’S FIVE FORCE ANALYSIS:.............................................................................12
VALUE- CHAIN ANAYSIS:..............................................................................................13
VRIO analysis:.....................................................................................................................14
SWOT analysis:...................................................................................................................15
TWOS analysis:...................................................................................................................17
Conclusion................................................................................................................................17
REFERENCES.........................................................................................................................18

3DIFFERENT TYPES OF BUSINESS
Introduction
The most important decision taken before and during starting a business is the type of legal
structure one selects for the company. This effects two things in a business; the first thing is it
will have a great impact on the tax paid to the government and the amount of paperwork that
an organization requires.
It is not only about having a business idea, it is about making that very plan work after a good
market research and considering all the legal aspects related to the business. In UK, there are
mainly three types of business structure that are followed and that vary on the basis of the
investors they have, liability of the business and the scale of the business.
This report discusses about the different types of organization, range of legal structures of the
business and their advantages and disadvantages and the PESTLE analysis, VRIO analysis,
and TWOS matrix of ASDA.
ACTIVITY 1(A)
Profit organizations: these are the organizations whose main aim is money making
anyhow. This is completely different from non-profit organizations and this basically focuses
on the way it operates and keeps-going. Most of the business present today currently and
serves as the majority are the profit organizations that includes the supermarkets we visit,
departmental stores and the local shop nearby; all these comes under the profit-making zone.
The main goal is to acquire more money than spent. It is observed that there are times when
the profit of the organization is shared by the workers or employees. In short, they have a
profit-sharing scheme which is the introduction of several plans for incentives; it can be paid
directly or indirectly or can be added as bonuses to the salaries of the employees. The total
profit earned by the company is kept the owner himself and most of the income is generated

4DIFFERENT TYPES OF BUSINESS
through sales. Employees are also responsible for the generation of income for the business
and the measurement of the success is done by tracking the sales of the organization and
based on this the profit is also calculated. For a business to be successful or to be in profit it is
very important that the revenue generated by the business is more than the cost of making it
at the end of the year. If an organization’s making cost is greater than that of the revenue
generated then the organization is making a huge loss and is not in profits anymore. Also, it is
considered as unsuccessful.
PUBLIC COMPANIES PRIVATE COMPANIES
Also known as PUBLICLY-HELD Also known as CLOSELY-HELD
Shares of stock are publicly traded Shares of stock is not publicly traded
Held by many individuals Held by few individuals
Freely selling and buying of shares is not
prohibited.
Freely selling and buying of shares is
prohibited.
There are two types of organizations that come under this category which includes the private
and the public companies.
Non-profit organizations: the main goal of these organizations is to serve the society for
better and to make profit for the society itself. People managing these organizations are
mostly the members of the committee and the trusties of the organizations. The major source
of revenue for the non-profit organizations are through donations and subscriptions made,
most of the capita is gathered through the donations made from people for the organization
and based on this the receipts and account of payments are made and is transferred to the
capital fund account.

5DIFFERENT TYPES OF BUSINESS
Non-governmental organization: these organizations are created by the persons who are
not related to the government but most of the fund is raised by the government itself. These
organizations are independent of any government prevailing in the country and these are
founded by the groups that are small in numbers and other associations. It aims at developing
the society for better and make the environment developed. There are various types of NGOs
that includes:
BINGO: Big International NGO
CSO: Civil Society Organization
TANGO: Technical Assistance NGO
MANGO: Market Advocacy Organization
GONGO: Government-operated NGO

6DIFFERENT TYPES OF BUSINESS
DIFFERNCE BETWEEN PROFIT, NON-PROFIT AND NGO WITH
EXAMPLES:
PROFIT
(ASSOCIATED
DAIRIES (ASDA))
NON-PROFIT
(CANCER
RESEARCH UK)
NGO
(DOCTORS
WITHOUT
BORDERS)
SIZE 1,65,000 3,964 36,482
SCOPE The scope of this
organization is the
purpose of serving
goods and services
that is reasonable to
everyone (Asda.com,
2020).
The scope of this
organization is to
save life through
research and to
prevent, control and
cure cancer (Cancer
Research UK, 2020).
The scope is to
include advocacy
programs which
would access
campaigns for drugs
for neglected
diseases (Doctors
Without Borders -
USA, 2020).
LEGAL
STRUCTURE
PROFIT
ORGANIZATION
NON-PROFIT
ORGANIZATION
NON
GOVERNMENTAL
ORGANIZATION
PRODUCTS AND
SERVICES
CR INSURANCE,
CREDIT CARDS
and TRAVEL
CANCER-CARE
PRODUCTS
ACCESS TO
MEDICINE

7DIFFERENT TYPES OF BUSINESS
MONEY
BUREAUX
BUSINESS
OBJECTIVES
TO PROVIDE
QUALITY
PRODUTS AT
CHEAPER PRICE
THAT IS
AFFORDABLE BY
THE PUBLIC.
TO SAVE LIVES
OF THE PEOPLE.
TO PROVIDE
IMPARTIAL
MEDICAL RELIEF
TO VICTIMS OF
WARS, DISEASES
AND MANY
MORE.
ACTIVITY: 1(B)
Micro enterprises: the businesses which have few people in their organization or the
number of employees in the organization is less than nine; then it is considered as a micro-
business. They generally have a turnover which is less than a certain amount. Due to this,
many people have now become self-employed (Hillary 2017). The main type of industries
served by this sector of business includes construction business, transportation,
manufacturing and commercial and services. The employees of this business is mainly the
family members of the house. The sector depends on the country of operation.
Example of micro enterprise: Castle Hill Fire Protection Ltd.
This is a private company as the specialization of the organization is installation of
passive fire protections systems and products (Castlehillfireprotection.co.uk 2020). Most of
its product is under the LPCB that stands for Loss Prevention Certification Board).

8DIFFERENT TYPES OF BUSINESS
Small- sized enterprises: these business have employees in a limited number of about
twenty-five and are mostly into businesses like service-providers, and manufacturing is done
over a small scale. It is seen that the materials and capital required for these industries are less
than large scale and greater than the micro businesses (Storey 2016). There are many
advantages associated with this kind of firm which includes independency; the owners here
are the real boss of the company, whatever may be the profit or loss the owner himself is
responsible for the same. This business provides a lot of opportunities to the owners of the
business and help in increasing the economy of the country. Despite of all these, there are
certain uncertainties; the business may not be very successful in the beginning but with the
pace of time it may grow and sustain all the needs and requirements.
Example of small enterprises: Bright star Financial
This company was established in the year 2011 and it specializes in residential
mortgages and later life lending. The company now has employed about 50 employees from
around three locations of UK and is based on strong core values. It aims at working and
winning together (Brightstar 2020).
Medium-sized enterprises: the number of employees in his kind of business is about two
hundred and fifty in number and it may also be a business that is owned by the family but the
size of the organization differs from the other two industries namely small and micro
businesses (Grant et al. 2014). It may also be observed that the ownership can be
differentiated or separated from the management of the organization.
Example of medium enterprises: Captify
This company was launched in the year 2011 and has received an investment that is
impressive. The main aim or goal of the company is to convert the consumers that are in their

9DIFFERENT TYPES OF BUSINESS
mode of purchase by displaying all the devices across them and scale a high performance
segment in order to achieve highest rate of returns (CAPTIFY 2020).
Sole proprietorship: this type is also known as sole trader and is considered as the
simplest and popular structure of business as it just requires an individual to start a business.
In this, there is a full retention of control as only one person is responsible for taking up the
risk, challenges and ownership. All the managerial functions are carried out by the owner of
the business (Bennett et al. 2019). He is the one who enjoys the profits in the same way if any
loss occurs he will be solely responsible for it as well. All the necessary capital for the
business is raised by the owner of the business. There is no legal existence of the
proprietorship only the proprietor himself is responsible for the same. The control of the
business is with one single person and he is the one to set the whole business himself
excluding others. All the firm decisions required for the company is taken by the owner. The
tax reporting is in a simplified manner and easily understandable format and it also requires a
very less reporting to anyone.
Example of sole proprietorship: The Accountsmith
It is a private company and the main service provided by the company is accounting
and auditing activities as well as bookkeeping activities (Anon 2020).
Partnership: this is an extended version of the above mentioned business structure that is
the sole trader. This may require one or two people to start a business who are equally
responsible for sharing the liabilities and responsibilities of the business. This kind of
business is not very costly to set and it is comparatively easier than other business structures.
Establishment of business is easy and the cost of start-up is also less in this kind of
businesses. The borrowing capacity and capability is even more in this kind and the caliber
made with partners is high in this kind of businesses. Formation of the business is also easy in

10DIFFERENT TYPES OF BUSINESS
this case as it would require less legal formalities as well as expenses. Resource availability is
more and there is an option of flexibility in operation. Also, there is a better management
seen and observed in this kind of firm due to the profit, control and ownership of the firm
(Uyarra, Shapira and Harding 2016).
Example of partnership: Social Chain
This is a research and campaign company whose main aim is to find more about
people and design campaigns that builds an emotional connections within people and
encourage them to act and think about the situations (The Social Chain AG 2020).
Limited company: this is very different from the other two structures of business as this is
a kind of separate entity to the owner of the business and both are on separate pages in terms
of legalities as the owner and the business itself are two different entities. This main people
of the company are the one who own the shares of the company. The accounts of these
business are complex and the liability is limited in this type of company. There is a better
efficiency of taxation as compared to sole trader and has a popular business model. There is
an additional accountant cost as the organization will require to hire an accountant due to the
company dealing with n number of taxes and profits and losses.
Example of limited company: Iceland
The company was founded in 1970 and is a retail industry. It has an employee count
of more than 950 and the main type of product is frozen foods and groceries. They also
include meals and vegetables that is already prepared.
Relationship between organizational function and objectives:
The activities that are carried out by any business is called as the functions of the
business and these can be divided into two types as the core and as support functions of the
business. The main role of core function is to get or yield income for the business and support

11DIFFERENT TYPES OF BUSINESS
function plays the role identifying the situations that is real and solve the internal problems of
the customers.
The functions and objectives of the business goes simultaneously as functions of the
business needs to be consistent in order to achieve the goals and objectives of the
organization. It helps in increasing the sales for the organization ad also improve the
satisfaction of the customers of the business
ACTIVITY 2
ASDA
The organization was founded in the year 1960 in Yorkshire with an objective to be the best
value retailer exceeding all customer needs every time and to help the stakeholders
understand why the business exist. The main purpose of the company is to provide best and
quality products that re reasonable ad affordable for the customers of the organization and for
everyone as well. The offering they make is based on the diverse range that customers
produce.
PESTLE analysis:
This analysis helps in analyzing the factors that are responsible for influencing the
organization externally. Or these are the external factors that have an impact on the
organization. Organizations must be flexible enough to adapt and accept these factors.
POLITICAL FACTORS: there is a great impact of legislation, consumer rights, taxes and
many more on the organizations like ASDA; these also effects the decision making of the

12DIFFERENT TYPES OF BUSINESS
company. Therefore, it is important that ASDA must keep monitoring these factors as ASDA
yields benefits from the stable political environment (Morgan 2015).
ECONOMICAL FACTORS: There are also factors like cost of credit, supply and demand of
labour, pressure from competitors and many more which affect the pricing strategy of the
company. Hence, ASDA must consider all these factors as well.
SOCIAL FACTORS: changes that include factors population that is ageing, lifestyles affects
businesses. These changes must be understood well and accordingly ASDA must produce the
products and services for the consumers.
TECHNOLOGICAL FACTORS: with the superfast and ever-growing technology, it is very
important that the organizations must keep a track of it and make use of it as well. It is
important that ASDA adapt these technological changes and stay updated that would work in
favor for them.
LEGAL FACTORS: there are certain rules and regulations that every organization must
follow as the breach of these would result in penalties by the authorities. ASDA must also
abide by these rules.
ENVIRONMENTAL FACTORS: there are many environmental factors like pollution, green
house effect, hazardous environment which must be kept in mind and made sure that ASDA
do not have any bad effect on the environment and must be an ensure environmental-friendly
company.
PORTER’S FIVE FORCE ANALYSIS:
This helps in analyzing the strength of the company against its competitors. It has five
forces which help in determining the competitive position of the firm (Gamble, Peteraf and
Thompson 2014).

13DIFFERENT TYPES OF BUSINESS
Bargaining power of supplier: STRONG FORCE; competition is very high and hence
suppliers have a lot of power as all the competitors are competing to get the first position in
the market.
Bargaining power of buyer: WEAK FORCE; customers of ASDA can readily switch
because of the huge competitors present in the market. ASDA has kept their price low which
would help in retention of more customers and less consumers will make a switch.
Competitive rivalry: STRONG FORCE; huge competition for ASDA hence aggressive
pricing strategy must be implemented to stay the market leaders.
Threats of substitutes: STRONG FORCE; if substitution becomes easy, the market
position of the company declines which would result in the drop of profits for the company.
The chances would have been more if ASDA decreases the price of the product
Threats of new entrants: WEAK FORCE; it is very difficult to acquire a new market in
which ASDA is operating and a huge capital is also required for this. Hence, this makes
ASDA stand above all the competitors as not many can enter the market and take ASDA’s
and take the position.
VALUE- CHAIN ANAYSIS:
This helps in understanding the sources of competitive advantage of the firm. ASDA can
avail this through two sources; cost and differentiation. This analysis depends on value’s
length and breadth (Chang et al. 2016)
Cost advantage of ASDA:
ASDA can negotiate the prices best in the market and maximize the process of transportation
using this tool and can also make a new and modest budget that is suitable for advertisement
and hence it would help in reducing the cost of marketing and also an affordable price can be

14DIFFERENT TYPES OF BUSINESS
kept and offered to the customers for the products. ASDA can also control the linkages and
economy of scale and also the utilization of capital to enhance its efficiency (Thompson,
Strickland and Gamble 2015).
Differentiation advantage of ASDA:
ASDA can do this using the value chain activities through backward or forward integration.
Distribution channels of the organization must be revised and made new keeping in mind the
convenience. Also, many new technical innovations could be made to sustain the market
needs (Thompson, Strickland and Gamble 2015).
.
VRIO analysis:
This analysis helps in analyzing the internal resources available in the organization. It also
helps in assessing the resources if they could provide a better and sustained competitive
advantage (Bustinza et al. 2015).
Valuable:
The resources that are valuable to the firm are as follows:
Financial resources: these are highly valuable as they help in increasing the opportunities in
future by investing in them.
Employees: these are the most significant and valuable resource of the organization as this
results in the increased productiveness of the output for the organization. Employees mostly
are loyal and retention becomes simple when the employees are loyal to themselves as well
as the organization.
Local food products: these are valuable as they are a highly differentiated one and perceived
value of customers for this is valuable.

15DIFFERENT TYPES OF BUSINESS
Rare: the financial resources are generally not carried by everyone. The employees of
ASDA are highly skilled and trained. Hence, better work environment and compensation is
provided to the employees so that they do not think of leaving the company. The best thing
about ASDA is its distributing network which is very rare and uncommon for all.
Imitable: the financial resources have been into the chain for a very long time and it becomes
very difficult for the competitors to follow it. Employees are also not readily available to
copy because there is a continuous loop and to invest in the same and significant is not asy
after copying.
Organization: everything should be in the right place and right manner only then efficiency
in the performance of the organization will be visible. The most sustainable competitive
advantage of ASDA is its networking and distribution channel that helps in ensuring the
availability of the products anywhere to everywhere (Baldwin and Evenett 2015).
SWOT analysis:
STRENGTHS
 Deep assortments
 Distribution is extensive
 Good marketing campaigns
 Sustainability
 Brands and services
WEAKNESSES
 Global presence is limited
 Business area is restricted
 Critics
 Competition
OPPORTUNITIES
 Expansion
 Acquiring small companies
 Online market
 Goals for long term
THREATS
 Changing policies of
government
 Online retailers
 Price cut from competitors
STRENGTHS:

16DIFFERENT TYPES OF BUSINESS
ASDA provides a deep assortment of products and services to its consumers as well as
customers. The various services of ASDA includes ASDA smart price, chosen by you,
George clothing and ASDA money and mobile. It is carried by about 25 centers for
distribution making it a unique feature for the company.
WEAKNESSES:
The global presence of ASDA is not very good and this is the biggest cause for its weakness
in the market. The strongest competition faced by ASDA is its ability to sell the products
below that of the competitor every time. Quality of the product of ASDA is questionable and
this results in strong competition from competitors.
OPPORTUNITIES:
The business can expand into domains that are new in nature and can also experiment with
the other departments like expansion in the jewelry sector, pharmacy and others. There is an
option for ASDA to acquire other companies which would help in expanding the business
and earn profits. Due to the digital transformation, it is very important that the company tries
and opens online market as well as the customer first preference now is being digitally
enhanced.
THREATS:
There is a huge competition in the market and it becomes very difficult when the Government
do not have any fixed rules and keep changing. Besides, there is a price cut throughout that is
consistent in nature and the presence of online retailers pose a high threat on the business.
TWOS analysis:
TWOS MATRIX STREGTHS
 The brand name of
ASDA is very
strong.
WEAKNESSES
 Product is not
available for all
segments of

17DIFFERENT TYPES OF BUSINESS
 Most of the benefit is
ripped by economies
of scale.
customers.
 Diversity is missing.
OPPORTUNITIES
 Expansion in
European market.
 Introduction to high
quality products.
 The strong name of
ASDA will help it to
the European market.
 ASDA can increase
the number of stores.
 ASDA can change
the mindset of
people by the
introduction of good
quality products.
 ASDA can follow it
competitors.
THREATS
 Increased
competition.
 Declining economic
growth
 More advertising
campaigns should be
started by ASDA.
 Variety suppliers
must be seek.
 The lack of diversity
must be addressed.
 New suppliers must
be reached by
ASDA.
Conclusion
Thus, at last it can be concluded that there are certain factors internal external and others that
are responsible for running of the organization smoothly. There are many functions and
structures of organization that are equally important and go on side by side. Different types of
organizations have different types of scope and it is very important to analyze the positive
and negative impact of the organization.

18DIFFERENT TYPES OF BUSINESS
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[Accessed 7 Mar. 2020].
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Mar. 2020].
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Protection. [online] Available at: http://castlehillfireprotection.co.uk/ [Accessed 7 Mar.
2020].

19DIFFERENT TYPES OF BUSINESS
Chang, W., Ellinger, A.E., Kim, K.K. and Franke, G.R., 2016. Supply chain integration and
firm financial performance: A meta-analysis of positional advantage mediation and
moderating factors. European Management Journal, 34(3), pp.282-295., 58(5), 53-60.
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