BMP3002 Business in Practice: Types of Companies and Their Structures

This report provides an overview of different types of companies, including micro, small, medium, and large businesses, and their characteristics. It also explores various business structures such as sole traders, partnerships, limited liability partnerships, public limited liability businesses, and cooperatives, highlighting their definitions and characteristics. Furthermore, the report discusses different organizational structures like functional and divisional structures, explaining how they affect business productivity, particularly in the context of ASDA. The analysis includes internal and external factors impacting businesses, offering a comprehensive understanding of business practices. Desklib provides access to similar solved assignments and resources for students.

BSc (Hons) Business Management with
Foundation
BMP3002
Business in Practice
Assessment 1
Types of Companies
Submitted by:
Name:
ID:
Contents
Introduction 2
0

Section 1: Different types of companies and how they work
2-3
Section 2: Different companies from sole traders to cooperatives
and Limited Liability Partnerships 3-4
Section 3: Different businesses structures and internal factors
affecting business 4-6
Conclusion 7
Reference List 8
Introduction
1

The aim of this report to examine maintaining business in order to enhance the growth
in the revenues by extending the work process and also to gain maximum profit with the help
of providing better goods and services to the consumers. A business can be made successful
by applying proper strategies and execution with the help of different facilities that are being
given to the buyers. There can be provide different advancement in various sectors in order to
maintain the outgrowth of business practises, as there are different companies like micro,
small, medium and large which are being engaged in providing goods and products to the
customers and also helping the country to generate the advancement and growth by
optimising production. There are different kinds of business practises like sole traders,
partnership, cooperative etc. all these businesses used to have appropriate legal structure
through which the develop goods and services (Mnich, and Wisniewski,2018). The
organisation chosen for this report is ASDA which is a well-known retail company
headquartered in UK. This report will cover the impact raised on the productivity and the
organisational structure used by the companies. Further it will also cover PESTLE analysis to
know the macro environmental factors.
Section 1: Different types of companies and how they work
In business there used to be applied different fields and industries which helps out to
run the company is in a proper and efficient manner. As there is being needed to enhance the
economic standards and development by providing proper goods and services and also by
maintaining proper living standard of people and communities. There are different types of
companies which used to perform various functions and work they are being mentioned
below:
Micro business: These are well known small-scale business which are mainly of
smaller size and they focus on effective business ideas in order to healthy local communities
to maintain their living standard. It mainly covers less than 10 employees being working
under them and their annual turnover is for around £2 million (Kishimoto,2019). This
business used to carry out lower production and lower participation of employees and also
generate less amount of revenues as they used to cover limited areas. Entrepreneurs used to
focus on opening all the micro business with a new innovative approach so as to contribute in
the societal welfare and advancement. All such can be family business or also a new start up
that is being led by any individual.
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Small business: It is all the privately managed business which used to cover specific
structure of business that involves Corporation, partnership, limited company and many
more. These business practises involve less capital and resources in accordance to the
medium and large business practice. There are about less than 50 employees used to work
under such business practises and their annual turnover is under £10 million. These
businesses are mainly being handled by small working team who focus on limited market
reach and also on the proper formation of partnership structures and average productivity. For
example, restaurant, Bakery, Architectural firms and many more (Sarkisov, and et. al., 2017).
Medium size business: These are mainly all the business activities which are being
framed on different locations and are more expanded as compare to small businesses. It needs
adequate capital with optimum resources to maintain their functional units and working. All
such business practises require less than 250 employees who are being working under them
and their net turnover will be around £50 million. All such organisation used to implement
and demonstrate their business in an effective manner as they focus on increasing the
production and providing employees maximum participation with proper utilisation of
resources. These business practises use machineries and heavy equipment’s and also focus on
raising capital with the help of employees, it provides small businesses to maintain the profit
and growth with their adequate benefits. For example, Crawford healthcare is a medium size
business.
Large size business: All such business practice which need more capital, manpower,
finance and equipment in order to run successful business and also focus on expanding their
business globally used to cover under it. They mainly focus on contributing for the economy
of country and also for generating and developing more revenues in foreign currencies by
making their economy stronger than before (Gelter, 2018). They try to innovate new products
and also to maintain their image in the larger segment of markets. In all such business there
are more than 250 employees who are being working under them and a net turnover is around
more than £50 million. The focus on huge capital with more manufacturing and production.
They also provide employment to the workers and also focus on sustainability and
environmental change. For example, HSBC holding.
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Section 2: Different companies from sole traders to
cooperatives and Limited Liability Partnerships
There are different types of companies which are being made as they help out to
increase the profitability and also productivity with its different approach. There are some
business structures which are being given as follows:
Sole trader business: All these business structure used to have the entrepreneurs who
used to maintain all such business practises in an easy and convenient manner. All such
business usually being carried out by individuals and they have to pay taxes with all the legal
considerations that are being needed in it. The major business structure which are being
linked with it are the procedures, ownership structures and with that the government
interference is also less as the owner can thereby operate the business by their own means
(Koryagina, and et. al., 2018). It mainly covers specific characteristics through which they try
to maintain implementing of decision making, unlimited liability, strategic planning, sole
management and many more. All the major responsibilities usually being lie on a single
individual who used to carry the profit and loss by them self.
Partnership: All these business structure used to have the entrepreneurs Who used to
maintain all such business practises in an easy and convenient manner. All such business
usually being carried out by individuals and they have to pay taxes with all the legal
considerations that are being needed in it. The major business structure which are being
linked with it are the procedures, ownership structures and with that the government
interference is also less as the owner can thereby operate the business by their own means. It
mainly covers specific characteristics through which they try to maintain implementing of
decision making, unlimited liability, strategic planning, sole management and many more.
All the major responsibilities usually being lie on a single individual who used to carry the
profit and loss by them self (Rogozina, and Punantsev, 2020).
Limited liability business: It is a hybrid business practice which provides protection
by implementing and removing unreasonable tax management. This mainly have a proper
ownership structure as in order to maintain partners liability as for the income tax payment
and investing in business. All the LLB can also be managed by two or more individuals in
order to operate the business in proper manner. A proper agreement is being signed by the
members and there has been prepared a self-assessment report through which the record all
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the contributions of the partners. The owners use to share same profit and will also be liable
to pay tax. It mainly involves financial privacy, transferable shares, massive share capital and
many more.
Public limited liability business: This promotes ownership structure through
which it can generate profit and also maintain proper specific shares through public tradable
and stock exchange funds. It promotes out specific features like high cost in capital, Limited
liability, transferable shares and many more. Such kind of business used to help out in
advancement and also in increasing the capitals and shares for public(Stroeva, and et. al.,
2021). All such business used to Work in transparent manner as it helps out to keep all the
decision making in front of all members. For example, Rolls-Royce plc.
Cooperative: All such business structures are being monitored by participants and they
used to focus on specific products and services that are being made by cooperative. It mainly
includes democratic control, voluntary membership, limited interest in capital etc. all such
business practises are being organised by unincorporated associations. This kind of business
used to provide equity capital and their dividends are nominal and limited. They help out to
maintain democratic management and also focus on different human values and services. It
focuses on organising and working as with legal bodies. For instance, Ocean spray is a well-
known cooperative company
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
Organisational structure is a framework which helps how to strategise important
techniques that raise out and maintain balance between all the activities of the organisation in
a proper and efficient manner. It mainly promotes a systematic approach with business
activities through which HR manager can adapt particular organisational structure in order to
manage their employees in an efficient way. This mainly contributes in enhancing the
Business activities and also help in focusing on objective that are being raised by the
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company. This helps out to maintain proper coordination and also helps in maintaining
smooth functioning of business practises with proper procedure. As in context to Asda the
HR manager specific organisational structure in order to enhance their production and growth
which are mentioned below:
 Functional organisational structure: The structure focus on maintaining the business
operations in a systematic manner as it implements the top-down structure through
which a proper flow of communication can be operated and the information can be
raised from the top-level management to their bottom level teams and employees. All
the appropriate decision-making is being taken by the highest authorities in order to
maintain the manpower. This structure carries similar features like hierarchical
structure, as all the higher level of management used to maintain a proper command
in order to maintain the actions and also to frame the guidelines and strategies for
working. It considers certain advantages as for the HR manager by implementing this
organisational structure, as it helps out to enhance the productivity of all staff
members and also to reduce the conflicts and disputes Between the employees and
employers. A proper time period can thereby be assigned by the managers in order to
complete a project or objectified goal (ТЕПЛОВА, И., 2020). There used to provide
several departments which used to work according to the functional manager as they
were being made a specific report through which the head used to identify the
working and keep check on assignments works. You are usually made different
smaller groups like finance, marketing, IT, human resource etc. As all the
responsibilities and roles are being divided between the departments so that smooth
functioning can be maintained.
 Divisional organisational structure: This structure helps out to operate specific
divisions and all such divisions are being maintained according to the resources and
the operations of work activities in order to support employees for maintaining
product line on different geographical basis. The main agenda of this structure is to
properly manage the parallel division and also to focus on specific products and
services that are being given to the customers. It used to focus on creating strong
customer base, maintaining proper geographical location and also in regulating
different activities. They used to focus on reaching out all the supply demands and
also to enhance their financial areas by providing optimum resources to their
customers.
6

 Hierarchical organisational structure: This is quite similar to functional
organisational structure as it usually a pyramid shaped structure which focus on top
level to lower-level management as all the decision-making process in the strategies
are being framed by the CEO and that are being implemented to all the employees
working in the company. They usually provide training sessions to their employees in
order to motivate them and also to implement the growth and production of company.
Thus, As from all the organisational structure functional is being used by Asda as it is
convenient and appropriate structure and it helps out the company to maintain proper
communication and also a proper flow of information to their employees and workforce.
3.2 How different external factors affect the performance of a
business – PESTLE Analysis
PESTLE analysis helps out to evaluate the performance of the company and also to
identify and analyse the external environmental factors that are being used in all the working
of organisations. As in context to Asda it is being mentioned as follows:
 Political factor: This includes all the important changes in the policies with the
regulations framed by the government as it mainly covers out the trade regulations,
political procedure, foreign trade policies and other different political considerations.
Asda has proper stability in maintaining their business operations as they have
reduced interference of political approach which helps them how to increase their
performance level (Rahman, 2018).
 Economic factor: This covers Interest rate, exchange rate, minimum wages, inflation
and recession. As Asda Is a well-known organisation and used to maintain a positive
approach and a direct participation which helps them out to enhance their economic
growth in country. But at the time of pandemic and Brexit company has faced adverse
situation through which they have to apply pricing strategies that are being convenient
in order to improve their production.
 Social factor: it includes the demographical changes that the company have to make
in order to satisfy their customers and also to fulfil their demands with the changing
requirements. In this factor they have to focus on effective strategies through which
all the cross-culture activities, purchasing behaviour, buying power of customers can
be considered. As Asda can focus on all the geographical considerations through
which they can conduct all the small-scale research in order to maintain the
customer’s preference in an adequate manner (Sindudipoera and Widhaningrat,2020).
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 Technological factor: It provides the technological advancement and a digital
modification that is being used by the companies. Asda can adopt different
technological levels in order to enhance their production and services by connecting
with the customers in an online method and also to connect with large population in
easier manner. The company used to focus on innovation in order to expand your
business and also to maintain high skilled efficiency.
 Legal factor: This mainly provides all the Legislative rules and regulations which are
being made by government. This factor involves all the lawful activities, procedures
and the rules that are being led by the government. Asda can maintain all the data
protection, health and safety measures while providing their services to their
customers. They try to implement all Legislative functioning in order to maintain the
smooth functioning of business (Ilic, 2020).
 Environmental factor: It involves the pollution rate, change in climatic condition,
population level, sustainability and many more. This sector promotes the protection of
environment with different approaches and measures, as Asda can maintain their
environmental consideration my promoting the green marketing initiative in order to
maintain the sustainability towards environment.
Conclusion
From this above report it is concluded that there are different kinds of business which
are being made by companies like Micro, small, medium and large. All such business also to
increase the economy of UK. Entrepreneurs used to maintain efficient business structure with
the help of partnership firm, sole traders, Limited liability business etc. all the companies
have their different characteristics and structures. Furthermore, it is also analysed that it is
important to frame organisational structure for the betterment of company and PESTLE
analysis helps out to identify the external factors for growth and production.
Reference List
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Springer, Cham.
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Diet and the US Congress (pp. 39-59). Routledge.
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Sarkisov, and et. al., 2017. Molecular simulation and experiments of water adsorption in a
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(2), pp.168-192
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