Report: UK Business Structure, Finance, and HR Policies for Startups

This report provides a comprehensive analysis of business structures, finance, and human resource policies within the context of a UK-based nail salon startup. It begins by examining various legal statuses of businesses, including public limited companies, private limited companies, and registered charities, evaluating their respective strengths and weaknesses. The report then delves into different sources of finance, categorizing them into short-term, medium-term, and long-term options, and assesses their suitability for the nail salon business. Furthermore, the report explores the significance of human resource policies within the business environment. The report concludes with a summary of key findings and recommendations for the nail salon business. The report aims to provide insights into the legal, financial, and operational aspects of starting and managing a business in the UK.

THE STRUCTURE OF
BUSINESS

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Question 1........................................................................................................................................1
A- Various legal statuses of business with its strength and weakness...............................1
B- Three sources of finance with strength and weakness..................................................1
Question Two...................................................................................................................................2
Identify three sectors within the UK economy in which a business can operate...................2
Question 3........................................................................................................................................2
HR Policies and importance...................................................................................................2
CONCLUSION................................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Innovation is the aspect by which start up business Idea comes in the mind of owner that
turn into new business. In relation to this, it is necessary to have the the analysis of required
resources and the business must we go on with the legal consideration and having effective
human resource and other finance source. The entrepreneur and the business is the individual
who is having unified skills and knowledge in order to start the new venture(Bashir and et.al.,
2019). All the business required monetary funding as it is the basic need of all the businesses and
maintain their legal structure and analyse the policies of the company so that they can identify
the target market where they have to operate their business. This report will analyse the different
legal structure which is being operated in the United Kingdom with their strength and weakness
and also evaluate the different monetary sources which are being adopted by the organisations
with their strength and weakness in order to start the new venture. It is also identified that
different human resource policies are there in the business environment. Nail salon is the chooser
business start up for conducting this report as it offers various services like manicure pedicure
and nail beauty to their customers. There are various options in the the nail salon which is been
provided are fibreglass wraps, manicures, polish and pedicures so that they can target the large
group of customers.
MAIN BODY
Question 1
A- Various legal statuses of business with its strength and weakness
There are various legal structure that is being used by the new startup company in the
United Kingdom they are divided into public private and registered charity. All the business
structure explained as follows:
Public limited company: it refers to the type of business in which the product and services
being offered to the general public within the minimum share capital of the government. 95% of
the private limited company are public limited company in the United Kingdom(Dicke, 2017).
Strength: this type of organisation found in an easy way and public limited company operating
their business as a signal legal entity from their owner and the shareholder which are included in
the business. The capital can be collected from the acquisition of different theories which is
being considered as the fortunately for expanding their business in new areas.
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Weaknesses: the public limited company is the one who is having no control over other
businesses and have consideration to protect their shareholders. The legal and regulatory
requirement can be high and the legal consideration for the financial resources is high that is up
to 25% is paid up in the public limited company.
Private limited company: it is the the combination of public limited company and
private limited company and there is a minimum paid up share capital of private limited
company which is been described and they just take the right to the transfer and having few
number of shareholders(Hrustek and et.al., 2019). As it would be up to 200 where the individual
to not have full control over the various aspects of the business. The organisation is generating
profit which is being shared among their shareholders in the form of dividend.
Strength: the private limited companies having a separate legal entity that do not required
minimum capital and the fund can be raised from the various ventures and investors. There is not
so much financial burden due to their unlimited shareholders and liabilities which is being
divided into them (Freitas Junior and et.al.,2017).
Weaknesses: private limited company cannot transfer their share cannot be issued to the public
as the share is not quoted in the stock exchange and the owner is liable for their insolvency of the
business venture.
Registered charity: when the individual or the association is proposed to be registered as
a limited company under the act for doing social welfare and registered in the limited company.
If the government is satisfied with the intention and the objectives after that the licence is being
issued for the person and the registered company is called as charitable company.
Strength: the charitable trust get huge relief from the taxes as they are operating their business
with the consideration of social welfare and having good public organisation by adding the trust
of the individual. Such organisation raise the fund from different sources by having charitable
status.
Weaknesses: charitable company is face restrictions to carry out the various operations and
required to comply with legal consideration which is being imposed by the government of UK.
Capital can't be raised from equity investment and the payment of the trustee for the supply of
professional services which is being provided until the constitution of charity and charity
commissioner have to pay attention on the required detail explanation about the firm(Levenson
and et.al., 2017).
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B- Three sources of finance with strength and weakness.
There are various sources of finance which are existing in the business environment and
there is a specific time period which is being adopted by the various source of finance(Calvo and
et.al., 2018). This includes internal and external sources of funds and the sources of finance can
be divided into three segments which are short term source of finance, medium term source of
finance and long term source finance. These all finance are based on a specific time period and in
context to nail salon the various sources of finance are given below:
Short term sources of finance
It is the financial facility that is being provided by the business for less than one year and it
includes various operating expenditure in order to run day to day operation which can fill the gap
among short term expenses and income.
Bank credit- it is the the common source of financing by which the Nail Salon can get the
financial support so that they can run their operation in an appropriate manner. Banks are giving
loans to the individual.
Strengths: these are the source of finance which is informal to acquire and credit is not
repayable on the demand providing fix rate of interest and it is also easy to make short term
deposit for any business venture.
Weakness: is the liability that required certain terms and condition which is to be fulfilled in
order to get the loan and it create various issues related to the cash flow in order to get the bank
credit.
Trade credit- this is the type of financing by which the nail saloon can acquire the product
from their supplier in the exchange of cash. It is the account payable on the purchase of certain
goods and services by the customers which is informal arrangement granted to the various
account basis.
Strengths: these are the resources which can be easily available that give flexibility and help the
business to expand their market as well as for their future growth(Utama and et.al., 2017).
Weakness: the risk is being faced by the supplier and the wire in terms of quality and
transportation which includes the various competition in order to understand the the terms and
conditions of the business.
Medium term sources of finance
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It is the the financing facility which is offered to the business for the time period of 3-5
years when the long term capital is available and the the revenue can be easily built with the
various sources of finance are given below:
Borrowing from banks- organisation borrow from the bank in order to meet their various
financial issues for the short term and medium term sources of finance. In relation to nail salon,
it is giving monetary funding from the different financial institution and the time period which is
given is 3-7 years. And it is considered as a a loan demand or demand for business. The financial
institutions in the United Kingdom get the financial support which is being offered the loan to
the business without any major security.
Strengths: after detecting the text the interest on debt is given that is paid interest amount and
principal. It is the the certain way by which the business can meet their financial requirements.
Weaknesses: the formula used to pay the interest which is being fixed and the principal amount
is related to the insolvency of the business it also enhances as the financial leverage that can
result in increase in the cost of equity to their business. It is evaluated as the expense in method
to get a loan for their business.
Lease financing- it is the important method which helps in meeting the financial requirements of
the nail salon by which we can get the fixed requirements assets and compensating monthly rent
for a particular period of time(Sungkono and et.al., 2017). Nail salon is a startup company which
is opening their valuable fixed asset of the business by which they can decrease the financial
burden to them and they can easily made the certain requirements of their operation.
Strengths: it is considered as a rate which is being fixed funding that is provided probable tax
based on the way the lease is organised. It also helps in meeting the certain requirements of the
business and also reduce the charges which is being incurred on the fixed asset so that they can
run their operation in an appropriate manner.
Weaknesses: these are the source which cannot be terminated before the original term is
completed and cannot be transferred to their owner who is responsible to maintain the property
and equipment as per the terms and conditions of the agreement in order to provide the lease to
the business.
Long term sources of finance
It is necessary to be the important part of a financial management which explain the credit
facility which is being provided more than 5 years and the source of finance obligation to the
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business in order to fulfill the liabilities in the long period of time that considered the fixed
capital requirement for the business and different sources are explained as follows:
Loan from financial institution- the government has set up different types of financial
institutions so that they can have the various business development and the loan from the
financial institution help the business in order to meet their financial requirement for a long
period of time. They provided the various financial requirement in the sufficient amount. A
business can get the affordable rate from the different financial institution and the nail salon is
taking all the consideration in the United Kingdom so that they can meet the financial
requirement of the business in order to run the new venture in an appropriate manner.
Strengths: the interest rate can be deducted and the organisation is having full control and
support to the business in order to meet the long-term requirements of their business is also help
in maintaining good brand image of the company in the capital market.
Weaknesses: the burden can be increased as they are giving higher interest rate for the business
and it consume use time in order to take the loan as it comes under the control of government
which follows a legal consideration and the sort of rules in order to grant the loan to the venture.
Government grants: the Government of the UK is having financial and non financial
funding organisation which can contribute in the economic development of the country. Nail
salon is taking the full support from their government so that they can meet the commercial
benefit and can take innovative solution with the consideration of meeting emerging challenges
which is been faced by the company forget and financial support by the government in the
country(Randhawa and et.al., 2021).
Strengths: the core benefit of the government is to meet the financial requirements of the
various business venture and there is no obligation to pay back and provide the loan on on a
larger scale.
Weaknesses: the loan which is being provided by the government are restricted which is
difficult to acquire is it includes various business proposal and convention. Grant is a word
which attached the money and the policies which is being used in order to implement the plan in
order to start the new venture in an appropriate manner.
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Question Two
Identify three sectors within the UK economy in which a business can operate.
There are various business sector which are are earning higher profitability and contribute in
the economic development of the country. Primary secondary and territory are the three types of
sector within the UK economy and there containing different operations in order to boost the
overall performance of the country. Difference between the receptors input and the output so that
they can add both value in the economic growth. These factors are are explained as follows:
The primary sector is also known as expression sector as it provide the for material which
can be a renewable source and includes powerful wood and wind. The resources can be non
renewable in nature are oil and the sector can get the raw material from the coals metal and
frame food. It also includes that business that is carried out the minimum activities and revenue
by selling the product and services of the company.
Secondary sector is it related to the production and manufacturing activities which are
conducted in the business(Loon and et.al., 2020). The manufacturing firms acquire the raw
material from the primary sector and then combine them in order to get the finished goods which
would be high in quality. The transferring of raw materials helps the business to generate higher
revenue by offering finished product to the wholesaler and retailer. When the companies
producing pre-production it helps in increasing the overall efficiency of their employees which
will add more value to the natural resources in getting valuable product.
Territory business is related to the activities which includes the enjoy and transportation
and other tangible goods to their potential customers. Business generate huge income by offering
effective services to the companies in the large market place. Constance, nail salon in the
territory sector which is offering commercial services by various beauty tips and services being
provided to their potential customers in the United Kingdom.
Question 3
HR Policies and importance
These are the certain guidelines and policies which is being used by the different business
organisation in order to operate their business across the globe(Le and Phan 2017). It also
represent the specific guidelines to the human resource manager on the various subject with the
consideration of recruitment selection compensation and promotion and training of the
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individual. In relation to nail salon, there are different HR policies which is being formulated by
the human resource manager in order to have the positive working environment and satisfy the
various legal consideration of the government.
Importance of HR policies
Resource policies are the set of ethical consideration which helps in measuring the various
challenges which are emerging in the business environment and also help the organisation to run
their business in a lawful manner. It serves the highest standard of performance where the
company can compare the actual result to the desire that how the employee is getting to their set
objectives in order to generate higher productivity(Frey and et.al., 2017). Human resource
policies also helps in motivating the employee and loyalty by having fair principles and certain
approaches for the growth of the business. HR policies also helps in decrease in the workplace
conflicts among the employees which also establish the uniformity and consistent treatment to all
the employees in the organisation with the main motive of eliminating the favoritism and
discrimination among the employees.
Two HR policies are-
Health and safety policies: it is the job security which is being provided by the organisation to
the individual and having effective work environment so that the workforce can feel happy and
comfortable in order to work there(Bashir and et.al., 2019). The health measure various
comprises of the employees suggest accident maternity leave and paternity leaves. In context to
nail salon, resource manager is not having any physical infrastructure so that they can have
effectiveness for their employee and meeting health and safety policies in order to get the extra
method employee in the business organisation.
 Equality and diversity policies: it is the policy which explain the fairness and correct
administration to the human capital within the association and in relation to Nail Salon,
there must be elimination of discrimination on the basis of colour caste gender so that the
effectiveness can be established within the organisation. Furthermore, the Nail Salon can
have the factor policies in order to support their employees by which they can feel
comfortable and relaxed by getting equal employment opportunity to showcase their
skills and knowledge. Policies can help in maintaining equality in the office for giving
equal opportunity to their employees at the workplace whether it can be male or female in
the organisation.
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CONCLUSION
It is analysed from the above report that there are different legal structure which is being
used by the organisation that is running their business in the United Kingdom. They are having
effective consideration of legal proceedings in order to open the new startup business in order to
meet the emergency change in the market. It also shows the business planning of the business by
having directive policies and strategies in order to run the business organisation. There are
various lawful assembly is followed in the United Kingdom in which the commercial business
have the obligation and money and order to frame the different businesses strategies. Human
resources strategies based upon the certain job management and the working environment of the
association so that they can in stablish good brand image and the effective use of their available
resources in the marketplace.
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REFERENCES
Books and Journals
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innovation on firm competence. International Journal of Innovation Science.
Frey, M and et.al., 2017. Food sharing: making sense between new business models and
responsible social initiatives for food waste prevention. Food sharing: making sense
between new business models and responsible social initiatives for food waste prevention,
pp.123-134.
Le, T.P.V. and Phan, T.B.N., 2017. Capital structure and firm performance: Empirical evidence
from a small transition country. Research in international business and finance, 42,
pp.710-726.
Loon, and et.al., 2020. Thriving in the new normal: The HR microfoundations of capabilities for
business model innovation. An integrated literature review. Journal of Management
Studies, 57(3), pp.698-726.
Randhawa, K and et.al., 2021. How to innovate toward an ambidextrous business model? The
role of dynamic capabilities and market orientation. Journal of Business Research, 130,
pp.618-634.
Sungkono and et.al., 2017, October. Refining business process ontology model with invisible
prime tasks using SWRL rules. In 2017 11th International Conference on Information &
Communication Technology and System (ICTS) (pp. 215-220). IEEE.
Utama, C.A and et.al., 2017. Corporate governance and ownership structure: Indonesia
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Calvo, N and et.al., 2018. Analysis of the growth of the e-learning industry through sustainable
business model archetypes: A case study. Journal of cleaner production, 191, pp.26-39.
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UNC Press Books.
Freitas Junior, J.C.D.S and et.al.,2017. Digital capabilities as key to digital business
performance.
Hrustek, L and et.al., 2019, May. Influence of digital transformation drivers on business model
creation. In 2019 42nd International Convention on Information and Communication
Technology, Electronics and Microelectronics (MIPRO) (pp. 1304-1308). IEEE.
Levenson, A and et.al., 2017. Human capital analytics: too much data and analysis, not enough
models and business insights. Journal of Organizational Effectiveness: People and
Performance.
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