Business in Practice: Sizes, Structures, PESTLE Analysis and Tesco

This report delves into the core concepts of business practice, examining the characteristics of micro, small, medium, and large businesses, along with various business structures such as sole trade, partnership, and limited liability entities. It further explores organizational structures and their impact on productivity, using Tesco as a practical example. The report also provides a detailed analysis of external factors affecting business performance, employing the PESTLE framework to assess political, economic, social, technological, legal, and environmental influences. The analysis provides insights into how these factors impact business operations and strategic decision-making, providing a comprehensive overview of business operations.

Business in Practice

Table of Contents
INTRODUCTION...........................................................................................................................2
TASK 1............................................................................................................................................3
Explain the characteristics of micro, small, medium and large size businesses. .......................3
TASK 2............................................................................................................................................5
Explain characteristics of sole trade, partnership, limited liability, public limited liability
businesses and cooperative. .......................................................................................................5
TASK 3 ...........................................................................................................................................6
Identify various organisation structure and its affects on productivity of business....................6
Explain various external factors which affects performance of a business with the help of
PESTLE.......................................................................................................................................7
CONCLUSION ...............................................................................................................................8
REFERENCES................................................................................................................................9
INTRODUCTION
Organisation refers to a group of people who are working together for the achievement of
common goal (Arnold and et. al. 2019). For success of any organisation its important that their
goals and objectives are clearly defined to its all members. So that they all can work with their
full efficiency and help in organisation growth. Business practice refer to various activities that a
business is conduct for effectively achieving its goals. Business practices helps business in fully
utilized their material and human resource which increase organisation performance and future
growth of business. Other than this structure of an organisation also play an important role in
development of business. It defines a hierarchy within an organisation. Structure of an
organisation defines how to operate business activities for achieving organisational goal. For this
report Tesco is taking into consideration. It is a British multinational groceries and retail

company, headquarter is in Welwyn garden city, England, UK. It is the third- largest retail
company which deals in different products such as grocery products, electronic products, fruits,
vegetables, home decoration products and so on. It has more than 7000 shops across all over the
world. This report include various characteristics of different size of businesses and partnerships.
Other than this it includes various organisation structure which influence the productivity of
business. This report helps in understanding influence of external factors on performance of
business with the help of PESTEL.
TASK 1
Explain the characteristics of micro, small, medium and large size businesses.
Business refers to an organisation or enterprising which are engaged in commercial,
industrial or professional activities (Bıçakcıoğlu, 2018). It includes activities like purchase and
sales of products and services in terms of achieving higher profit. Size of business is depends on
number of employees and investment invested in business for effectively operating business
activities. An organisation is also considered structure, type of industry, internal and external
environment and so on. On the basis of size organisation is divided into four parts that is micro
business, small business, medium business and large organisation. Characteristics of these
businesses are mention below:
Micro business- It refers to a type of small business which require less than 10
employees for effectively running business operations. It only require less than $250,000 as a
annual investment for effectively run business. It is a type of sole proprietorship where only one
person is responsible for performing different functions of business. Such as planning,
organising, directing and controlling.
Characteristics- Various characteristics of micro business are mention below:
 Sole proprietorship- Micro business is also known as sole proprietorship or individual
entrepreneurship. It is owned by single person and individually operates all operations of
business. This type of business have no legal distinction between owner and business.
 Self-motivated- This type of business is operated by a single person and he is the only
one who will be perform all function of management. Their is no interference of other
people who influence their decision so that he will be able to do work with their full
efficiency for achievement of its goal (Boone and et. al. 2019).

Boss Brewing is the biggest example of micro business deals in craft brewery. Which is only
established by a husband and his wife and now a days become a most successful micro business
of UK.
Small business- It refers to a type of sole proprietorship, partnership and a privately
owned company, which is limited in size and revenue. In terms of manufacturing company
which include 500 employees is known as small business. While on the other hand a bakery shop
with less than 15 employees is also known as small business. For starting a small business a
person require 10 millions as investment. Market area of small business is limited to a small
number of customers.
Characteristics-
 Ownership- Small business are developed by a single owner which is also known as sole
proprietorships. Its all management work such as planning, organising, controlling etc.
are controlled by owner (Burrieza and et. al. 2019).
 Labour intensive- Small business is based on labour intensive techniques. This is
because they have limited requirement of employees and do not need to invest in
technology. Its operations are depend on labours and manpowers.
Broadsword Event house is a small business of UK. Which is an event planning company and
successfully achieve its objectives by providing customers satisfaction service.
Medium business- According to company act 2013 medium business refers to those
businesses in which up to 250 employees are working. These businesses are mainly family-
owned and managed business. It operates at a large platform as compared to micro and small
business. Medium business create employment for local people. Operations of medium business
are effectively conducted as compare to large organisation.
Characteristics-
 Easily adopt dynamic environment- Main characteristics of this type of businesses is
that its management is flexible in nature and easily adopt changing environment. This
characteristics help business to achieve higher growth and profit by easily adopting
dynamic environment.
 Make profit- Main objective of medium size business is to earn higher profit with low
investment as compare to large organisations (Farias and et. al. 2019).
Verdant leisure is a best example of medium business which is an holiday park company.

Large business- it involves a large scale of corporate controlled and business activities.
This type of business require more than 250 employees and require a large amount of
investment.
Characteristics-
 Capital intensive- Large organisation is based on capital intensive technology for
effectively perform its business operations. This technique reduce the cost of production
for company and helps in achieving higher revenue.
 Heavy capital investment- Large organisation require a large amount of investment for
successfully operating its business activities. Investment in large business is much more
as compare to small and medium size business.
From above discussion it is analysed that Tesco is an large size organisation which earns
more than 64.760 billions in a year. It is the third largest retailer company which operates its
business through various supermarket, hypermarkets, superstores and convenience shop. It
require a huge amount of investment for effectively managing its business operations. More than
423,092 numbers of employees are successfully working with it. Its proper organisation structure
helps in effectively managing its business operations.
TASK 2
Explain characteristics of sole trade, partnership, limited liability, public limited liability
businesses and cooperative.
Business refers to an occupation of buying and selling products and services for earning
higher profit. Business is classified into various types such as sole trade, limited liability,
partnership, public liability business and cooperative. Various characteristics of these factors are
discuss below:
Sole trade business- It refers to a business which is run by a single person and
individually enjoy profit and take all risks. Sole trader refers to a self-employed person who
individually run business operations of a limited company. Sole trader is the only person who is
liable for its all debts. Main characteristics of this type of business is that the liability of its
owner is unlimited. Other one is this type of business doesn't require to registered and a single
person can operates its all business. Best example of sole trade business is Achilleous energy
company owned by a single person (Hair and et. al. 2019).

Partnership- It refers to an agreement between two or more people for effectively
operating business operations and equally share all profit and loss (Retamal, 2019). Main
characteristics of this form of business is that its all partners are libel to bear profit and loss on
the basis of their ratio of investment. EY is the best example of partnership which is an leading
accounting company and successfully run their business.
Public limited business- It refers to a company which is owned by shareholders.
According to company act 2013, this type of company has limited liability and have a right to
offer shares to general public. Main characteristic of this type of company is that it require to
registered under law. Tesco is the best example of public limited company which is the largest
retail company of UK.
Cooperative- It refers to a type of private company which is a association of persons
come together for fulfilling any economical, social and cultural need. Main characteristic of
cooperative company is that it has a voluntary membership. Animorph is best example of
cooperative business. Which is based on the problem of medial and social challenges.
TASK 3
Identify various organisation structure and its affects on productivity of business.
Organisational structure of a business firm defines the way in which activities such as
coordination and supervision of employees are completed within an organisation. TESCO
utilises hierarchical organisational structure which contains a strict chain of command and
decisions are taken bu high authorities and are passed down to employees at lower levels. the
effect of this organisational structure of British retail organisation is positive as employees see a
clear path towards their career growth which motivates the employees to enhance their
performance. in addition to this overall output of the respective company is enhanced through
effective communication between employees as roles and responsibility of reach employee is
clearly defined. TESCO is able to maintain high productivity through this structure as it
contributes in smooth functioning of the company and timely completion of various business
goals (Katz and Green, 2018).

Explain various external factors which affects performance of a business with the help of
PESTLE.
Political Factor: It include factors such as rules, regulations, government policy, laws,
taxation policy, labour law and restrictions and many more. All these factors imposes positive as
well as negative impact on the working of organisation. In discourse to Tesco, it is third largest
retailer company which operates across worldwide such as UK and London. If there is a change
in taxation and government policies of the country thus it imposes direct impact on sales as well
as profitability of the company. Change in law affect the overall activities and functionality of
Tesco in order to execute their work in ethical manner (Osunnuga, 2020).
Economic Factor: This factor plays an essential role in the organisation as itinvolves
deflation and inflation rates which imposes direct impact on sales and profitability of the
business organisation. In context of Tesco, the economic position of UK is strong thus it will
create more and more income for business organisation in order to gain competitive advantage
in the marketplace. In assistance of this, the company offer employment opportunities which
assists in accelerating standard of living of employees.
Social factor: These factors involves age, income of the society, demographics and areas
that affect sales as well as profitability of business organisation. It is important for company to
produce goods according to the needs and wants of consumer. In reference of Tesco's, the
supervisor manufacture those goods that helps in satisfying the needs and demands of customer.
It creates good brand image as well as reputation of the company in competitive environment
(Kumar and Misra, 2020).
Technological factor: In the present time period, technology plays a very crucial role in
order to accelerate productivity as well as profitability of the organisation. In context of Tesco,
the supervisor of company adopts latest technology in order to achieve competitive advantage in
the marketplace. It is very important for manager to give training session to employees in order
to use advanced technology that helps in decreasing the wastage of work.
Legal Factor: There are different rules, laws, regulations and legislation that affect the
operation of business organisation. In context of Tesco, the supervisor execute these laws and
legislations inside the organisation thus it provides safety and security to the employees working
in the company. Legal responsibilities should be done in a proper way to enhance the legit
working of the business (Long, 2018).

Environmental factor: The Business has to keep an eye on both external and internal
environment so that it could function smoothly. In context of Tesco, its higher authorities ensure
to minimise the use of carbon footprints that impact positively on the environment. Along with
this, it also help company in developing its brand image positively at marketplace (Zahari and
Romli, 2019)
CONCLUSION
From above discussion on this report it is concluded that there are various types of
organisation. Which are divided on the basis of size, investment and employees. On the basis of
size a business is divided into four parts which are micro, small, medium and large business.
Other than these types of business this report helps in understanding various types of businesses
which are classified on the basis of forms. It includes sole trade, partnership, limited liability,
public limited liability and cooperative business. For successfully run business operations its
important to select a effective organisation structures. PESTEL helps in analysing impact of all
political, economical, social, technological, environmental and legal factors on business. It helps
business to identify these factors and take effective action for success of business.

REFERENCES
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