L2 Business Unit 1 – Business Purposes P2 Describing Business Ownership

Learning objectives/intentions To be able to describe different business ownership To know the links between size, turnover and scale

P2: Describe the different types of business ownership, linking this to the size and scale of four different organisations. The size of a business depends on the following three factors Number of employees Easiest to use but P/T employees may skew results. Example: phones for you have 10,000 employees & 350 shops Sales turnover The value of goods sold. Scale of operations

Small businesses Eg sole trader, partnership, LTD Also co-op’s and franchises can be According to CBI Small = 1-49 employees like local newsagent A small business has turnover to £10 million per annum Usually one factory/office

Number of employees Easiest to use but P/T employees may skew results. Example: phones for you have 10,000 employees & 350 shops According to CBI Small = 1-49 employees like local newsagent Medium = employees There 10,000 in UK Large = 500 employees +

Sales turnover The value of goods sold. The income generated from it’s services. According to CBI 2011 A small business has turnover to £10 million per annum A medium business has turnover £ million Large businesses has turnover of £500 million +

Scale of operations This the size of it’s operations not it’s physical size. An example is textbooks/b?ie=UTF8&node= textbooks/b?ie=UTF8&node= The more an organisation can buy/sell the larger it’s operation is. The larger the operation the greater economy of scale.

The links between the factors Type of goods offered. The cost of expanding. Owners ambitions. The knowledge of the market. Competition.