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

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Task 1 Describe the type of business, purpose and ownership of 2 contrasting types of businesses. Sole Trader � A sole trader is a business owned by 1 person. It does not have limited liability meaning that if it fails and creates debts the owner is personally responsible for this. � Sole trader's usually have to work long hours and learn about all the aspects of business as many start up businesses cannot afford to hire people to take on other tasks. � The owner is responsible for everything that goes on in the business and has to do a lot of work. The owner also receives all the profit and is able to make decisions on their own. � The owner has full control over the business. � Hair dressers, small independent shops and book keepers are usually sole traders. Partnership � A partnership is a lot like a sole trader only there are more than 1 owner. � This usually means the work and responsibility is shared and so are the profits. � Good examples of partnerships are dentists, accountants and lawyers. � There is usually more money and ideas that can be put into the business. � There may be disagreements between partners and this can affect the way they run their business. � Depending on what contracts were drawn up, one of the owners may decide to leave and leave debts to the other owner or owners. Each partner has to take the risk of full responsibility for the business. Private Limited Company � A limited company is separate from its owner. This means if the company is sued or creates debts, they cannot take money from the owner. This means that an owner can only lose what they have put into the business and nothing more. � A limited company is usually a fairly small business and has up to 50 shareholders. ...read more.


Many banks are asking people for 40% deposits and very high fee's to obtain a mortgage, whereas 5 years ago banks would lend 100% of the mortgage with no fees. Tesco have expanded into the banking and insurance industry and have probably found that during this recession they have had a decrease of sales in this area as they are also unlikely to want to lend money to people. When inflation goes up the cost of living also goes up. The price of commodities can have a huge impact on the price of things consumers buy every day. For example the cost of wheat has doubled in the last 5 years. There are a lot of foods that have wheat in the recipe, for example bread and cakes but even products like oven chips can list wheat in the ingredients, and this has meant the price of food in general has risen. There have been many factors that have affected the price of wheat. Kazakhstan is a big importer of wheat, and they decided to impose a tariff to curb sales, this affected the cost of wheat. In 2008 Australia had the biggest drought they had had in 100 years; this halved their winter crop of wheat and meant there was not enough supply to meet demand which pushed prices up. Drought and water shortages also affected the crops, and bad weather in Ukraine also can hurt production. Demand for alternative energy sources has led farmers to sow less wheat and convert land to crops such as corn, sugarcane and rapeseed that can be turned into biofuels. Ethanol, diesel and other liquid fuels can be made from processing plant material. But this means there is less land for growing food crops. Wheat prices may come down as high prices convince farmers to devote more land to the crop, but this takes time. Growing demand for wheat is another factor that has affected the price of wheat. ...read more.


to be aware of these changes to ensure they are stocking the right products and initiating new methods to help improve their service. With a wide range of people moving into the UK from abroad this can have a big influence on society. In some areas where there are a high proportion of people from one area it affects what products are sold in stores nearby. For example in Luton there are many halal products stocked, in areas in London there are a lot of kosher products sold and in Milton Keynes there is a lot of polish food in Tesco stores. If another country joins the EU and therefore has the right to move to the UK freely, there may be another influx of people moving into the UK and this may affect the types of products that are being sold in that area. There are currently laws that help companies to compete fairly, and to prevent some companies from making it too difficult for other companies to compete. For example there are restrictions on how many Tesco supermarkets there can be in one area. There is also talk that the government are still concerned with how much Tesco's are growing and plan to restrict their growth in the UK. If plans are made to discourage Tesco's from growing further than they may wish to grow their business outside of the UK and focus more on expanding into new countries and growing in the countries they currently operate in. Tesco's currently rely on the UK market as this is their main source of income; this could help Tesco's to make profits from abroad. 1 BTEC Business Level 3 Book 1 Pages 9-11 2 http://www.beds.ac.uk/knowledgehub/innovation/businessgrowthplan/bgpcasestudies/vendesent 3 http://www.tescoplc.com/plc/about_us/strategy 4 http://www.tescoplc.com/plc/about_us/strategy/international/ 5 http://www.tesco.com/recruitment/html/careers/compInfo/values.htm 6 http://idlepenpusher.blogspot.com/2009/01/causes-of-credit-crunch-recession.html 7 http://financial-dictionary.thefreedictionary.com/Mature+Economy 8 BTEC Business Level 3 Book 1 Page 27 9 BTEC Business Level 3 book 1 Page 32 10 http://www.dailymail.co.uk/news/article-1107564/Not-M-S-safe-recession-forces-closure-27-stores.html 11 http://www.toolboxmarketing.co.uk/ArchiveAlert.aspx?TrendID=19 ?? ?? ?? ?? BTEC Extended Diploma in Business Unit 1 The Business Environment Gemma Parnell 1 ...read more.

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