• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Different types of business.

Extracts from this document...


Sole trader: When setting out in business, you will probably be setting up on your own, using your own personal capital to get started. The sole trader is the most simplest business to develop as it initially consists of only you and has very little legal formalities, obligations or constraints attached to this form ownership as opposed to other forms; in fact it is just a case of informing the tax inspector and contributions agency of your intentions and you can begin to trade. You also need only a small amount of capital and you're in business. Remaining as a sole trader has many advantages; mainly being that you are able to give a more personal service to your customers and you are able to make changes within your business very quickly, due to there is little or no bureaucracy there being only one person to make the final decisions. Other advantages include having complete control over the business (decision making) and keeping all the profits, you are able to use any money the business brings as you deem fit without having to justify you're spending to any one. Unlike other business formats, sole traders (and partnerships) can start trading straight away, although certain types of businesses may need a licence to trade. However, it has its disadvantages; mainly Multi-nationals would be able to cope with demand and supply more readily and far more quickly than a small sole trader, as greater investment would allow them to buy equipment, increase production, adopt new technology and develop new ideas. The pressure put upon the sole trader must not be ignored, and as a sole trader you must address this issue as it could ultimately threaten the survival of your business. Apart from the pressures placed on the sole trader by the larger organizations, you are also fully liable financially, and the need for your business to examine the implications and consequences of bankruptcy or loss of personal possessions due to the sole trader accepting ...read more.


Large amounts of capital can be raised in relatively short time periods. It is easier for the business to borrow a loan. However it has the constraints. There are legal formalities which must be carried out before the company can be set up. The company must produce some accounts. Ltd has to pay for some legal paper work, for example limited liability. Can't earn as much capital as a plc, because a plc sells mush more shares than a Ltd More difficult to get a loan because the banks don't know the business well, but for a plc is mush more easily to get a loan because the bank now's who they are. Cannot advertise their shares for sale Do not have their share prices quoted on stock exchange Public Limited Companies In a typical public company the directors hold only a small fraction of its shares When a company terns plc means they want to expand, diversify their quality products to other location. A plc is formed or more usually created by the conversion of private companies into public ones when the necessary capital cannot be supplied by the directors or their associates and it is necessary to raise funds from the public by publishing a prospectus. The main benefits on a plc are that each shareholder enjoys limited liability so they are not risking personal bankruptcy. The business has continuity, because its survival is not influenced by the personal circumstances of its shareholders. Large amounts of capital can be raised in relatively short periods because of the company's size and the security it offers. It can specialise by setting up separate departments and using specialist equipment. The companies have a separate legal existence from their owners. People are willing to invest in such companies because they are organised through the stock exchange, so people can get their money back easily. Large amounts of capital can be gathered in one organisation. ...read more.


They also want to maximize turnover because a higher turnover may lead to the more efficient use of resources such as machinery and equipment. Caspian has three Magazines wish target different readerships, they have defined target audience, fortunately Caspian now's who their target audience is, they now what they have to write; now what they are aiming at, they now who they have to target is terms to get profit. Caspian is aiming at the advertisers, but to get the advertisers to advertise in Caspian they need to produce a high quality of work, they need to have a high market share to captivate the advertisers. However Caspian wants to maximize market share because the greater the market share, the more power the firm will have to set prices or to control production. Expansion, although Caspian may try and consolidate, eventually because of the competitive nature of the market Caspian may need to start thinking about expanding into new geographical markets or aiming their product at new segments, for example entertainment magazines. They need to start producing new products and hang on to their target audience. They want to be successful on what they do in terms to expand their target market and to make profit for the business. However, the workers have objectives as well. Directors often want to increase their own status by being a director of a growing and prestigious company with a good reputation. They could do this by maximising the businesses share of the market, giving the business more power. Management, want bigger salaries and extra perks. They may want to be paid bonuses based on increased turnover to motivate them to work harder. Employees always want higher wages, more time off, better working conditions. Suppliers, if the company increases its sales they can increase the supplies they provide. Unfortunately I didn't manage to get Caspian's Mission Statement, wish is a short phrase used to state the general targets of a firm. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Structures, Objectives & External Influences section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Structures, Objectives & External Influences essays

  1. Marked by a teacher

    ASDA's Ownership

    4 star(s)

    Task 3: Business Activities A). Every business has a main core activity. ASDA has a main core activity of selling food and household consumables. Apart from selling just food and household consumables, they also offer tobacco, alcohol, clothes, newspapers/magazines etc.

  2. Btec National Business Level 3 Year 1 - Exploring Business Activity

    Wide span: The production manager controls more than six employers. Managers are forced to delegate work, and tasks may be less closely supervised. There are possible problems with the overloading of work and with loss of control. However, there are fewer levels of management.

  1. BTEC Business. Organisational Structure in different types of business.

    have a section where they have information about the jobs available in the UK for Centrica to try and recruit more workers. The office staff will try to recruit new workers and volunteers Customer Services Centrica provide after sale services, including replacing damaged goods, solving customer problems The customer services

  2. The Business Environment Coursework. Describe the type of business, purpose and ownership of ...

    If a company does well it means more taxes are paid which affects government as they receive more money. Tesco's need to think carefully about the products they sell. Customers expect the products to be accessible and of good quality.

  1. For my portfolio, I was asked to do an assignment on two businesses. I ...

    Then bread is sliced and packed for customers. Tesco produce their own bags to help customers to carry their goods. Tesco provide good services to their customer with a title 'little helps' by providing various kind of training to their employees such as how to use scanners quickly and easily and they use some headers to help customers

  2. Introduction to J Sainsbury plc

    (Source: www.j-sainsbury.co.uk) This demonstrates that Sainsbury's marketing and sales function uses a wide range of market research methods to keep a close eye and particular attention on other leading competitors, such as Tesco, Asda and Safeway. This is to ensure that they are meeting their objective of being the first choice for consumers' food.

  1. Barclays Investigating a Business

    Through earning enough money from customers a business will meet all its objectives in order to stay in business. Every businesses first aim is to survive as 4 out of 5 businesses go bankrupt within the first few months of starting out.

  2. Investigating Business. Tesco PLC. I will be describing the aims and objectives of ...

    As consumers are careful on how much they spend during these tough economic times they want a lot of promotions, offers and discounts to save more money, this may mean consumers would want to purchase their most loved products/ luxuries but at the same time be able to afford it.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work