BMP3002 Business in Practice: Evaluating Business Structures and Types

This report provides an analysis of various company types, ranging from micro-businesses to large-scale ventures, detailing their characteristics and operational methods. It explores different organizational structures, including sole proprietorships, partnerships, and limited liability companies, highlighting their features and benefits. Furthermore, the report justifies different business structures and examines how external factors, such as political, economic, social, technological, environmental, and legal (PESTLE) factors, influence business ventures, using ASDA as an example to illustrate these impacts. The analysis concludes by emphasizing the importance of understanding these factors for achieving competitive advantage and sustainable growth.

BMP3002: BUSINESS IN
PRACTICE

Table of Contents
INTRODUCTION.....................................................................................................................................3
SECTION 1................................................................................................................................................3
Understanding of varied types of companies and how they work........................................................3
SECTION 2................................................................................................................................................5
Explaining different organizations from sole traders to cooperatives and limited liability partnership
...............................................................................................................................................................5
SECTION 3................................................................................................................................................6
Justifying business structures and how external factors affect ventures...............................................6
CONCLUSION..........................................................................................................................................9
REFERENCES.........................................................................................................................................10

INTRODUCTION
Business practice refer to process of activity and strategy that a company
conduct in order to reach their desire outcomes in term of achieving set goals. It is
the way that management attempt to do in appropriate and cost effective
manner. The current assignment will define different types of companies and how
they actually work. It will justify firms from sole traders to cooperatives & limited
Liability partnerships. Furthermore, at lastly the report will explain types of
ventures structures and clarify how external factors affecting business.
SECTION 1
Understanding of varied types of companies and how they work
In the world of business, there are different types of organizations operate
and manage their businesses activities in excellent manner and these are;
Micro business-
This category of companies also named as micro enterprises that mostly
perform in specific sector, with less than 10 workers who are able to satisfy
customers at local level. Barber shops, small supermarkets, web based or online
ventures, etc. are included in list of micro business that may able to conduct their
practices in regard to grow a venture (Adi and Miradji, 2020).
The key feature of micro companies is that the owner of these firms may
have power to take decision independently. It may also have small teams of
people and limited resources that used to earn profits.
For example, funeral care is the best example of micro venture because it
operates at medium level to make arrangement in the context of people funeral.
Small companies-
A small venture is described as a privately or publicly owned corporation,
sole proprietorship and partnership that may has less than 14 workers and less
annual profits than a regular or big sized organizations (Dunne and McBrayer,
2019). Health care, arts, personal trainers, food & beverage stores, local auto

repairs, etc. are covers under the list of small ventures.
The main feature of these businesses is that overall management power
may held by only one person who may the owner of a company. They have limited
area of operation and use skills of local people by making them as workers who
understand needs and expectations of individual person.
For example, Layness Espresso is appropriate example of small company,
which as founded in 2011, to achieve the aim of owner. It works in effective
manner by producing tasty coffee.
Medium size firms-
A medium size company refer to those organizations that is smaller than
micro and small and work at low extent by using key abilities of individual
candidate that may accessible not more than 5.
In term of features, the best thing about medium size companies is that
they understand target market quite effectively and appropriately and also willing
to learn from own failures (Xiang and et.al., 2019). Another characteristic of these
types of firms is unity of employees, which made them capable to accomplish
daily work on time as they support each other.
For instance, Oat Cash and Carry as medium size firm, usually focus on
retaining potential customers by offering food items according to their needs and
expectations. It helps company to work appropriately and productively in retail
market.
Large size ventures-
This kind of businesses refer to those enterprises that employ more than
600 workers and work in term of increasing profitability, which is quite beneficial
and essential for their rapid growth and success within a sector.
The main characteristic of these companies is that it may have wide range
of resources that management use to achieve set goals, which made them
capable to gain competitive benefits in the future along with gaining current as
well. They have varied sources of funding, which a medium, small and micro firms
may do not had so.

For example, ASDA as large size supermarket, take pleasure of its venture
success in retail sector where it may build strong and wide customer base, by
selling quality products in different categories by taking individual buyer need into
consideration.
SECTION 2
Explaining different organizations from sole traders to cooperatives and limited
liability partnership
Sole trader business-
It considers as a company that run by only one person who named as sole
trader, because they capable to take decision individually and guide individual
person to work according to their strategic plan (Yordanov, 2019).
In list of characteristics, there are many points cover in regard to sole trader
business. For example, just because of having one owner, individual may enjoy
the benefits of their business success in term of increasing profitability. They may
access take benefit to flexibility as the main feature of sole trader company.
Funeral care may include in this kind of list, because their owner is able to
take action regarding their venture, without taking any approval from the other
people's.
Partnership-
It is another type of legal business structure that may utilized by those
companies who take interest in performing or working with other firms as
potential partners. It made an entrepreneur capable to work in collaborative form
and conduct coordinate activity in appropriate manner, which is quite essential for
each business partners to do (Mendoza-Flores, Quintero-Ramírez and Ortiz,
2019).
Partnership business main feature is share of profits, which individual
partner may share with each other after doing a lot of hard work and conducting
attempts. It benefits both in term of reducing work pressure on one person as by
doing business together, partners divide roles and responsibilities.

Waitrose is the most appropriate example of partnership brand, who may
conduct business activities with John Lewis & partners.
Limited Liability business-
Just like above two, it also includes in category of legal business structure
that mostly utilize in the context of private firms, who efforts to achieve their
strategic goals and objectives, to increase profits, generate revenue and
maximize productivity. A LLC is a set of a corporation and partnership, which
made individual person able to obtain desire outcomes.
The main feature of this type of organizations is that it offers limited liability
protection and prevention to its members (Characteristics of Limited Liability
Company, 2021). Furthermore, it also provides a lot of flexibility to each member
in term of tax treatment.
For example, Oxfam international is one of those LLC's that operate globally
and contribute to enhance living standard of local people.
Public Limited Liability business-
It designates an organization that may offer shares of stock for stake of
society or community well-fare. The customers of those profits may have limited
liability organizations. It works for sake of individual benefits and to make them
happy. These types of companies may do not held accountability for any venture
losses in excess of amount they pay for valuable shares.
In term of characteristic, a public limited liability firm, provide stakeholders
facility to easily transfer their shares to public as they do not face any challenge
or restriction during process of transferring share to public.
HSBC holdings as PLL venture may work effectively and hold power to take
decision without any interference.
SECTION 3
Justifying business structures and how external factors affect ventures
Organizational structures defined as the most appropriate systems that

clearly outlines how key activities at workplace may direct, just to make assure
that everyone work together or individually to achieve set aim of a company.
There are different types of organizational structures has been available in this
corporate world that a firm may use according to size and scope of their business,
these are;
Divisional structure-
It is one of those organizational structures that most of the big brands may
utilize to work in productive manner and reach at expect outcomes in effective
manner (Kiruba Nagini, Devi and Mohamed, 2020). It drives the attention of
management towards dividing groups into sections, which made individual
candidate capable to understand their roles and accountability and perform
accordingly at workplace.
Divisional structure may affect business productivity in positive manner, in
term of increasing performance level of each worker as they know how to work
and for what. It made them able to achieve set aim and perform duties as per the
position.
Functional structure-
It is another type of organizational structure that a firm may use to work
functionally and productively. By using this one a company may effort to groups
workers according to similar set of tasks or specialized roles. It contributes to
increase organizational productivity in term of dividing major departments of a
company into varied groups for example, finance department, IT, marketing, HRM,
etc.
By dividing groups management may obtain benefits of having strong and
wide teams of employees who may contribute to maximize productivity in term of
working together and assist in aim achievements.
External factors that affect organizational performance-
In order to determine the external factors, here PESTLE analysis may use,
which made a firm capable to take better precautions about the impact of each
factor whether it is positive or negative.

Political factor-
Any change in relation to political factors such as trade policy, tax rate,
political stability, etc. put direct impact on a company and their current activities
whether it is operational or functional. In case of ASDA, fluctuation in
governmental decisions due to pandemic may put negative impact on
organization that operates under retail industry. It effects in term of shutting its
outlets just like other brands stores that may lead to decrease organizational
productivity and profitability, which bring more challenges to the brand.
Economic factor-
Fluctuations in the context of economic factors like unemployment
education level, income level of people, etc. also directly impact on productivity
and performance of an organization such as ASDA. For example, due to pandemic,
unemployment extent is high, which put positive impact on chosen brand in term
of providing opportunity to hire local people in cheaper rate as individual want to
work in such a firm where they get respect and to do the same in regard to
management.
Social factor-
Emerging trends, changing behavior of customers regarding product
purchase and people perception in regard to goods and services, may put affect
on a business performance. In case of ASDA, veganism as current market trend
may put positive impact on its performance in term of increasing number of
selling because supermarket already follow this trends and now make
arrangement bit in term of making list of more vegan items that individual
customer currently prefer to buy and find out in supermarkets.
Technology factor-
Development of digital marketing tools and channels may put positive
impact on ASDA, as it gives marketing teams opportunities to generate excellent
brand awareness globally. In term of affecting performance level of company, it
may contribute to enhance productivity and efficiency of marketer in form of
making advertising easier for them. It contributes to increase web traffic and to

build wide customer base, which is quite tough to develop for any company as
they do not use appropriate tools and sources.
Environmental factor-
Customers and government demand as well as concern regarding
environmental sustainability may put positive impact on ASDA. Organization may
already take initiative to prevent nature from harmful factors like air, water and
other kind of pollution's which may affect negatively upon beauty of nature. It
may effort to use reusable materials for purpose of packaging foods and other
items. By doing so, firm may build strong and influencing brand image all over the
world, where key customers and investors may accessible, who are interested to
connect with this kind of company.
Legal factor-
As external factor is also affect business performance in negative manner in
term of putting a lot of pressure upon management within ASDA to comply with
new terms and conditions in the context of employment law that may change just
because of COVID-19.
CONCLUSION
On the basis of above analysis, it has been concluded that micro, small,
medium and large size companies has gained competitive edge by running
ventures into different sectors and using key features. Furthermore, from above
discussion, it has been determined that organizations has overcome the negative
impact on each factor upon organizational performance by taking right actions
into their consideration and using approaches after forming each.

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