About the business - Venetian Ices LTD.

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About the business

Rajdeep Dosanjh

My name is Rajdeep Dosanjh and I have been assigned to complete a tasks concerning Venetian Ices LTD. The tasks in which I have been ask to complete are to explain what a payment system is, different methods in which employees can be rewarded and recommend how different types of employees can be rewarded. I will also have to investigate the laws which affect a business which produces ice cream and write a report for the directors of Venetian Ices LTD advising them of their responsibilities. Furthermore I will also have to produce a leaflet to accompany the report, which identifies the most important laws for a business producing ice cream.

The business first showed signs of evolving when Marco Polo took the recipe for ice cream to Venice. This period created the reputation the Italians have for producing superb ice cream. It was in 1948 when Toni Seghini travelled to London in order to create an ice cream factory, which predictably became a successful business venture.

Toni started with a small factory which supplied ice cream to local retailers, during this period he also ran a ice cream sales van. Gladly for Toni, the sales of ice cream in the 1950’s grew with a general upward trend. However, the ice cream industry has not been without some problems, one of which gave Toni the opportunity to extend the business to a considerable extent.

During the early 1950’s the government introduced a number of regulations, such as the food and drugs act (which became food and safety act in 1990). These regulations which soon were passed by parliament to become laws, affected smaller ice cream manufacturers as they were unable to produce the finance needed to accomplish these regulations. Toni was quick to react against these changes in law by forming Venetian Ices LTD, he did this by buying out many similar manufacturers, this expansion meant that Toni could develop both take home and impulse lines.

        The ice cream industry experienced another problem in 1962 when the government put a tax on ice cream. Sales fell dramatically but only for a short time, however this period was too long for some firms, which went out of business. In order to take advantage of this situation the directors of Venetian Ices LTD agreed to introduce franchising into the mobile selling part of the business. This was extremely successful.

          As the business produces its own ice cream by extracting the raw materials from a primary business then Venetian Ices LTD falls under the stage 2 category of business, secondary. Venetian Ices LTD buy their materials and resources from a primary business and then convert them into the ice cream which then at a later stage, will sell them through either supplying them to retailers or selling the products themselves. Activities in the secondary sector of industry include building, construction and baking. Around the beginning of the formation of Venetian Ices, not only was the business supplying ice cream to local retailers, but at that time they were selling their own ice cream through their own vans, this puts them in the tertiary stage as they are selling their products to consumers. This stage involves providing services or products to consumers and other businesses. Activities in this sector include transport, banks, retailers and insurance.

        Venetian Ices LTD is a public limited company, hence the LTD. In these businesses, the company is normally jointly owned by the people who have invested in the business. These people buy shares in the company and they are therefore called share holders. These shareholders appoint directors to run the business. In this type of business the directors are usually the most important or majority shareholders. There as many advantages within a Private limited company. For example, shares can be sold to a large number of people (normally friends or relations). With the extra amount of money received from the sales of shares, more capital can be invested into the company which opens more doors if the company wishes to expand in any way. This is what was done when Toni Seghini decided in order for him to keep afloat the business he had to expand and allow others to invest into the business. Another major advantage would be that all share holders take advantage of limited liability. This is an extreme advantage as if the company fails in regards to paying off debts to creditors, then the shareholders of Venetian Ices LTD  have no fears of losing their personal possessions to compensate debts. In fact the only cash that the shareholders could lose is the original amount they firstly spent on shares. This advantage encourages people to by shares, as the amount they pay in investments is the maximum amount of cash they can lose. It is vital for people thinking about investing into a business to know whether the company is a sole trader/partnership/LTD etc.… as creditors for example, need to know that if the company did fail to pay debts then they do not have the right to take the company to court to demand dept payments through the shareholders personal possessions. For this reason ALL private limited companies names must end with LTD or private limited company.

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There is also a great advantage for the founders of the company which is that they are able to keep control of the company provided they do not sell a large extent of their own shares to other people. Therefore the original directors and shareholders of Venetian Ices LTD can as a result stay in touch with the companies processes (providing they do not sell high proportions of their shares).

 However in opposition to these advantages there are also many disadvantages which need to be taken into consideration, notably there are many legal requirements which need to be dealt with ...

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