BMP3002 Business in Practice Assessment 1: Exploring Company Types

This report, submitted by a student and available on Desklib, provides a comprehensive analysis of various company types, including micro, small, medium, and large businesses. It delves into the characteristics of sole traders, partnerships, and limited liability companies (LLCs) and public limited liability companies (PLCs). The report explores the impact of functional and divisional organizational structures on business productivity. Furthermore, it applies a PESTLE analysis to Marks & Spencer, examining the political, economic, social, technological, legal, and environmental factors influencing the company's performance. The conclusion summarizes the key findings, providing a well-rounded understanding of business practices and external influences.

BMP3002
Business in Practice
Assessment 1
Types of Companies
Submitted by:
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Contents
INTRODUCTION....................................................................................................................2
SECTION 1:.............................................................................................................................2
SECTION 2:.............................................................................................................................3
SECTION 3:.............................................................................................................................4
CONCLUSION.........................................................................................................................7
REFERENCES.........................................................................................................................8
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INTRODUCTION
Company is body corporate or incorporate organizations which registered in
company’s act. This can be unlimited or limited firm, public or private. Company is legal
entity which is formed for the purpose of conducting business. This is related to a group of
people who have come together to conduct business and have their own legal existence,
eternal succession and common seal. In this report, Marks & Spencer organization will be
considering as it is specializing in offering the home products, food items and clothing. The
main focus of this organization is to provide the high quality of services to consumers so that
they can be satisfied (Anand and Mantovani, 2021). There will be discussion about various
kinds of the companies and how they are mainly work. Various firms from sole traders to
cooperatives as well as limited liability partnerships will be discussing in present report.
SECTION 1:
Micro business: These are small firm that employs nine or fewer members and has a
balance sheet or turnover of less than particular amount. For an example, Boss Brewing
Company is micro business and it changing the perception of the gender in beer sector, it is
woman led craft brewery from the South Wales.
Small business: Small companies are privately held companies, partnerships or sole
proprietorships with fewer workers or lower yearly income than larger company or firm. For
an example, CafePod Coffee Co. is small size business and it is producers of the exciting and
strong coffee foe e adventurous coffee drinks (Georgieva and Abdelazim, 2020).
Medium size business: They might be family-owned as well as controlled
companies but due to their scale, they might be complicated enterprises with management
and ownership divided. Medium-sized enterprises are often well-established as well as have
proven track record, making it easier for investors and lenders to make funding choices. For
an example, Giacom is medium size business and provides single platform for the IT
platforms in order to gain the access to broader range of the services (Rao, 2021).
Large size business: A organization which meets two of the following three criteria
like more than £25.9 million in annual revenue. Total of many more than £12.9 million is
shown on the balance sheet. More than 250 staff members on average. For an example,
Marks & Spencer is large size firm and it is specializing in selling the high quality of
clothing, food items and home products to customers.
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SECTION 2:
Sole trader business: Sole proprietorship is an individual entrepreneurship or ownership,
is form of business owned and operated through single person with no legal separation
among owner and the company. For an example, Barbershop, Beauty parlour and general
store run through single owner (Grassi and Vallati, 2021).
Characteristics of the Sole trader business
 This company is owned through single person.
 Unlimited liability
 No separate entity
Partnership: A partnership is a legally binding agreement among two or more individuals to
manage, run and share profits in a business. Partnerships are available in wide range of forms
and sizes. Partners in a partnership firm share equal obligation and profit, although partners in
other firms may have limited responsibilities. For an example, partnership among GoPro &
Red Bull.
Characteristics of partnership business
 Equally profit sharing
 Existence of agreement
Limited liability business: Limited liability corporation (LLC) is type of the private
company structure (Jafari and Othman Soleiman, 2020). In a general partnership, all
the partners are liable for the firm and have unlimited liability for its obligations. The most
necessary advantage of the investing in the publicly traded business is restricted liability
aspect. While shareholder can participate in firm's growth, its responsibility is limited
to amount invested in firm, although it later goes bankrupt and also has outstanding financial
commitments. For an example, Anheuser-Busch, Blockbuster and Westinghouse are
organized as the limited liability companies.
Characteristics of Limited liability business
 Limited liability
 Separate entity
Public limited liability business: PLC stands for a firm that has made stock available to
general public. The who purchase those shares have a time constraint. Public limited
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company seems to be an incorporated voluntary group of members which has separate legal
existence as well as limited responsibility for its members. A public limited corporation is
one which is listed on the stock exchange and has publicly traded shares or stocks. British
Petroleum Company Limited as well as HSBC Holdings are two instances of public limited
liability companies (Lawrence, 2020).
Characteristics Public limited liability business
 Limited liability
 Transferrable shares
Cooperative: Cooperative business is form of the business that is owned as well as governed
by its members, who still consume cooperative's products and services. This is defined as an
independent organization of individuals who have come together voluntarily to achieve the
common economic, social and cultural needs and ambitions through jointly held firm. For an
example, Central England Co-operative and Channel Islands Co-operative Society are the
cooperative business (Maliki and et. al., 2020).
Characteristics Cooperative business
 There is voluntary membership.
 Have democratic structure
SECTION 3:
3.1
The term "organizational structure" refers to a system which describes how certain
activities are handled to achieve a certain organizational goal. These activities include things
like rules, role and responsibilities. The organizational structure of a company determines
flow of information between levels. The manner in which activities such as task distribution,
coordination and monitoring are geared toward achieving organizational objectives. An
organization's structure has an impact on its activities and acts as foundation for the standard
operating procedures including routines. The different organizational structures and their
impact on the business productivity are given below:
Functional structure- The basis for arranging personnel is the functional
organizational structure. In a functional structure, the organization is organized into
departments based on their functions. They are separated into the groups based on their
individual skills and expertise. Each department is organized vertically, with jobs spanning
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from president via finance and sales, customer service and human resources (Morrison,
2020). Individuals with similar abilities and expertise are grouped together through activities
they do; functional departments may allow for higher operational efficiency. As a
consequence, each group of professionals may operate independently, with management
acting as a focal point for the cross-functional collaboration. Its system permitted more
specialization. An executive and team leader is well-versed in and experienced in their field.
For example, an individual in control of the IT department will have the knowledge and
abilities needed to take on this role and lead the organization to success. Staff with
comparable abilities and expertise are placed together in organizations that adopt functional
organizational structure. Staff may perfect their abilities by becoming professionals as well as
specialists in their sector as a result, resulting in the long-term professional growth. These
personnel' in-depth expertise can assist a corporation in attaining its long-term functional
objectives.
Divisional structure- Each function of an organization is divided into divisions in
divisional structure. Each division is equipped with all of resources as well as functions
required to serve product line or region in question. Self-contained subdivisions make up
divisional and product structure. Division is group of functions that work together to create a
finished product. The benefit of divisional organization is that this employs delegated power,
allowing each organization's performance to be directly assessed. As result, leaders perform
much better and staff morale is higher. This is much more economical to coordinate work
across various divisions while using divisional structure and there is a greater flexibility to
adjust whenever there is variation in business. The advantage of utilizing a divisional
structure is that this is efficient in improving coordination among separate departments and
allows for greater flexibility in responding to market changes (Trad, 2021). Additionally,
if corporation needs to adjust its size through adding or deleting divisions, procedure will be
simplified. When a divisional structure is used, additional specialization within in the group
might arise. Although each division acts as autonomous entity, this encourages flexibility as
well as initiative, resulting in quicker decision-making. It permits decision-making
to delegated lower in organization, perhaps improving the firm's capacity to adapt to the local
market circumstances.
3.2
PEST analysis is defining as macro-environmental factor framework utilized
in the strategic management's environmental analysis aspect. When doing strategic analysis
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or conducting market research, this is part of the external analysis that provides overview
of many macro-environmental aspects to be considered. This is strategic tool that is used for
understanding the market growth or decline, business potential, business position and
direction for the operations. The PESTLE Analysis of Marks & Spencer looks at company's
business strategy. PESTLE Analysis examines how political, economic, social and
technological (PEST) factors but also legal and environmental factors, influence a company's
performance (Perera, 2017). PESTLE Analysis determines various extrinsic circumstances
that have an influence on brand's business. The PESTLE analysis of Marks & Spencer given
below:
Political factors- Marks & Spencer is a multinational retailer with a significant
presence in a number of nations. The firm is based in United Kingdom and has over 1300
locations throughout the world. The benefits of C's trade agreements have resulted in cheaper
sourcing costs for the company. This company can take benefit of enormous EU market, in
which its products may easily transit between countries without any restrictors like taxes and
tariffs.
Economic factors- Foreign exchange rates, Interest rates, inflation rates and
economic development patterns are all examples of economic factors. United Kingdom has
world's greatest economies. The UK's monetary policy are well-managed, as the government
has successfully maintained inflation low while maintaining healthy finances. Marks &
Spencer has been impacted mostly by crisis, with corporation having to reduce 2% of its
70,000-strong workforce. The firm's capacity to offer a discount was harmed by recession,
and corporation abandoned its initial plan to provide a 20% discount on the Christmas
(Ghauri, Strange and Cooke, 2021).
Social factors- Culture as well as traditions of a society have impact on the culture of
business. A manner Marks and Spencer Group Plc marketers perceive and craft marketing
messages for the retail sector customers are more impacted through shared valued of the
people.
Technological factors- Marks & Spencer company has launched a Technology
Transformation Program to assist the company in becoming a digital-first company and
providing more diversified consumer experience. It is focusing on creating a new
Technologies Operating Model which would help the company use new technologies and
embrace industry agile techniques.
Legal factors- Every country's legal system is always changing. Marks & Spencer
provides frequent training sessions on issues such as health and refreshes them every year to
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ensure that employees are up to speed on the most recent rules and regulations. When the
corporation was accused of failing to protect its employees and other workers from the
hazards of asbestos exposure, it came under scrutiny (Taylor and Perkins, 2021).
Environmental factors- Marks and Spencer company has often vowed to be a much
more sustainable business in order to preserve their reputation as luxury brand. It refers
to wide range of environmental conditions that influence the purchase of food, clothes and
household goods. Marks & Spencer's company desire to become more environmentally
friendly business is not unprecedented as numerous other UK firms have pleaded.
CONCLUSION
From the above mention report, there has been discussed about the various kinds of
organizations like micro, small, medium and large size with examples. There has been
discussion about the different types of companies such as partnership, sole proprietorship,
public limited and others with their characteristics. Functional and divisional structure and
their impact on the business productivity has been explained in detailed manner. There has
been conducted the PESTLE analysis to determine the external factors which impact on
business performance.
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REFERENCES
Books & Journals
Anand, A. and Mantovani, G., 2021. Homegrown Terrorism: An Analysis of Its Effects on
PESTLE Factors. In Transdisciplinary Perspectives on Risk Management and Cyber
Intelligence (pp. 21-46). IGI Global.
Georgieva, M. and Abdelazim, A., 2020. Strategic Mergers and Acquisitions in Higher
Education: A Case Study from the UK.
Grassi, A. and Vallati, M., 2021. An Exploratory Study on the Use of Artificial Intelligence
to Initiate Legal Understanding for Business Development. FLAP, 8(4), pp.1065-
1082.
Jafari, H. and Othman Soleiman, K., 2020. Assessment of effective environmental factors in
oil and gas industry policies using PESTLE & SWOT analysis (case study: Kurdistan,
Iraq). Environmental Sciences, 18(3), pp.134-151.
Lawrence, J., 2020. An investigation into the business environment of small, medium and
micro independent caterers in Cape Town (Doctoral dissertation).
Maliki, A.B. and et. al., 2020. PESTLE analysis on Bieichi technology—technology which
turns plastic waste into fuels.
Morrison, J., 2020. GLOBAL BUSINESS ENVIRONMENT: Towards Sustainability?. Red
Globe Press.
Perera, R., 2017. The PESTLE analysis. Nerdynaut.
Taylor, S. and Perkins, G., 2021. Work and Employment in a Changing Business
Environment. Kogan Page Publishers.
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