I have been asked to write a report on my investigation into two contrasting types of business organisation from different sectors. One from the voluntary sector and the other being part of the private sector, the two contrasting businesses I have decided to choose and research on are Tesco PLC and The British Red Cross. In my research I am going to write about, how first of all businesses operate and also which sector they are in. I will then go on to write about the purposes that businesses have and their types of ownership. After that I will write about the two businesses I have chosen and the way they operate, sector, purposes and compare the way the types of ownership are in terms of advantage and disadvantage.

1. Unit 1 P1
Lewis Appleton 1 Miss Johnston
Introduction
I have beenasked towrite a reporton my investigationintotwocontrastingtypesof business
organisationfromdifferentsectors. One fromthe voluntarysectorandthe otherbeingpartof the
private sector,the twocontrastingbusinessesIhave decidedtochoose andresearchonare Tesco
PLC and The BritishRedCross. In my research Iam goingto write about,how firstof all businesses
operate andalsowhichsector theyare in.I will thengoon to write aboutthe purposesthat
businesseshave andtheirtypesof ownership.Afterthat Iwill write aboutthe twobusinesses Ihave
chosenandthe waytheyoperate,sector,purposesand compare the waythe typesof ownershipare
interms of advantage anddisadvantage.
The ways businesses operate
Local
Local businessescanoperate withinthe local towns,theyare usually small businesseshoweverin
the future theymaybecome biggerandgo national.Local businessesare locatedinverylimited
areas suchas a specifictown.Local businessesare notrecognisedmuchinareasthat are not near
the locationof the businessbutmaybe recognisedbyneighbouringtowns.Thiscouldbe the startof
greaterdevelopmentforthe businessasthe brandismade more aware to potential customer,the
businessgainsprofitandisable tohave more storesacross the nation. For example;local
hairdressers,butchers,cornershopsandschools.
National
National businessesare companiesthatacrossthe nationhave outlets,thisiswhere the business
wouldhave outletsoverthe country, andintime theymaymove outletsoverseasandwillbecome
international.Nationalbusinesseswill have previouslybeenlocal businesses,awarenessandgreater
recognitionof the businesshasallowedittogonational andhave manymore outletsacrossthe
nation.These businesseswillstillbe aimingtogrow andsurvive.National businesseswill continueto
grow andbecome more recognisedbythe communityandmayeventuallybecomeinternational
businesses. Forexample;CostcuttersandNisalocal.
International
International businessesoperate inanumberof countriesthathave a numberof outlets,aftereven
furtherprogress,storesmaybecome available acrossthe globe andtherefore become aglobal
business.Tescohasvariousstoresacrossthe worldbecause theyare an internationalbusiness.
These businesseshave evenfurtherdevelopedfrombeinglocal thennational businessesandare
nowevenmore recognisedinthe worldandwill be able tomake more revenue anddevelopment.
These businessesare still tryingtogrowto become highlypopulararoundthe worldandeventually
witha good enoughincrease inrevenuesandpopularityitwill become aglobal business. For
example;Tesco,BHS,Sainsbury’s.

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Lewis Appleton 2 Miss Johnston
Global
Global businessesare well knownacrossthe worldandhave manyoutlets.The BritishRedCross
globallyhelpspeople aroundthe world. Global businessesare atthe higheststage of the way
businessesoperate,theycannotachieve ahigherstage buttheycan continue tobecome evenmore
popular,make evenmore revenueandbecome more recognisedbythe world.Whencomparing
global businessestolocal businessesitiseasytosee how hard and longitis forthe businessto
achieve enoughrecognitionbutitispossibleasIhave statedin the example below;
A goodexample of abusinessthatstartedoutsmall andbecame global inthe future isMarks &
Spencer.Theywere once alocal business,sellingsmall productsinsmall local areasandeventually
continuedtoincrease popularityandsalestherefore becomingnational,internationaland
eventuallyafterlongperiodsof time,effortandsurvivingtheywill become globalbusinesses. Some
of the otherglobal businessesare McDonalds,KfcandCoca Cola.
Business sectors
Publicsectorbusinesseshave the objectiveof providingaservice tothe public.Theyare takenover
or ownedbythe government,these typesof businessesusuallywill nottake bigrisksbecause rather
than make a profit, theyaimto benefitawide varietyof people.Private sectorbusinessesare
privatelyownedandare ownedby individualsinmanycountries,the ownersof private sector
businessesrisktheirownmoneyanditispossible thatbeinggreedywill leadthemtomakingbad
decisionsastheytake largerrisks.The BritishRedCross isa voluntarybusinessrunbytrusteesfora
goodcause andis inthe voluntarysector.Tescois publiclimitedcompanythataimstomake a profit;
theirsharesare opento everyone.
Business purposes
Businesseshave differentpurposessuchasprovidingaproduct or service,examplesof thismaybe;
a downloadservice onthe internet,adental operationora haircut.Online storesandpeoplewho
specialiseinthese serviceshave apurpose tokeepthe customerssatisfied.The risingpopulationof
expensive servicesgive agoodexample of how supplyisraisedtolowerthe demand,where atthe
same time the expensive service gettingmore customers andmoney.There are typesof businesses
that provide aservice andthat istheirmainpurpose,theyare alsoothersthat expecttogainhigh
revenue fromtheirbusiness.Businesses suchaspubliclimitedcompanies needtomake sure the
runningcostsfor the businessanditsoperationsare lessexpensivethanthe revenuetheyare
gettingotherwisetheywill notbe makingprofit. There are otherbusinesseslikecharities thatare
the businessesthatare onlythere toprovide aservice tothe communityasa gooddeed andmay
relyon donationsinordertokeepthe businessrunning.
Business ownership
Sole trader

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Lewis Appleton 3 Miss Johnston
A sole traderisa personthatownsand controlsa businessalthoughtheycanemployeeworkers.
Sole tradersdon’thave a separate legal existence.Thistype of businessisone of the mostcommon.
For thistype of business,the setupisverysimple andthere isnothingcomplicatedinit.The sole
trader makesall the decisionsusuallyandall profitsgotothisperson.There are disadvantagesof
beinga sole traderas makingall the decisionsmaymeanthatmore hourswill have tobe spentat
work.There isalso the disadvantage of nothavingthe legal protectionof limitedliability,meaning
that any debtsall are giventothe ownerandtheyhave to findouta way of how to paythese debts.
In eventsof this,sole tradersmaytake precautionsbytakingouta loanfrom the bank.
Partnerships
A partnership setshowprofits,responsibilitiesandpaymentsare assessedbetweenbusiness
partners.Partnersoftenshare knowledge andskills.There are disadvantagestopartnershipssuchas
people canfall out,decisionsmaybe difficulttoagree on, andprofits needtobe shareddependant
on the partner’scontributions. Partnershipsare formedasa solutioninthe eventsof asole trader
havingdebtssothat the businessdoesnothave topay all the debtsfromone person.Partnerships
that are formedmeansthata Deedof Partnershiphasto be formed.
Private limitedcompanies
Private limitedcompaniesare smallerthanpublicones.Often,these are businessesrunasa family.
The minimumamountof shareholdersis2but there isnota maximum.The sharesare limitedand
can onlybe soldto specificpeople. Privatelimitedcompanies have limitedliabilitymeaningthat if
the businessmakesmistakesleadingtodebtsthenthe ownersare onlyresponsible forthe debt
equal tothe value of theirshares.Theywill onlylosewhattheyinvested.
Publiclimitedcompanies
Publiclimitedcompaniesselltheirsharesonthe stockexchange.Large amountsof revenue canbe
obtainedquickly.A disadvantage isthatthe original shareholder(s) canlose control of the businessif
amountsof sharesare boughtas part of a “takeoverbid”.Publiclimitedcompaniesare protected
fromdebtsbeingputuponthe ownerby “limitedliability”meaningtheywillbe protectedwiththeir
moneyandinsteadof the debtbeingputuponthe owner,the debtisput uponthe business.
Private and voluntary sector Business
The two companies i have chosen are Tesco and the British Red Cross.
History
Tescois a supermarketwithvariousstoresaroundEngland;itwasfirstopenedinthe eastendof
Londonin1919 byJack Cohen.Tescotookovera chainof 212 storesinthe northernEnglandin
1960. Tesco.comwaslaunchedin2000 andin 2010 theyopenedthe firstzero-carbonsupermarket.
As of February2010 there are 5380 stores,alsoas of 2010 the amountof employeestheyhave is

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Lewis Appleton 4 Miss Johnston
472000. Tescosellsvariousproductssuchasgroceries,telecoms,financial servicesandconsumer
goods.
In 1870 the BritishRedCrosswas firstformed,theyjoinedthe Orderof St.JohnAmbulance during
the firstworldwar to give resourcestothose inneed.The first BloodTransfusionservice wassetup
by the BritishRedCrossin 1941. At the declarationof the secondworldwar,BritishRedCrossonce
againformeda partnershipwith St.John,once againhelpingthose inneed.Afterthe warthe main
objective of BritishRedCrosswastohelpthe large numberof civilian’sdisplacedforcedmigration
duringthe war.
Howthey operate
BritishRedCross operatesbyhelpingpeople inneed globally.The organisationisledbyagroup of
trustees;theyprovide healthservicesworldwidebutwere probably originallyinthe United
Kingdom.Theyalsohave manybranchesoverseasthatdelivervital serviceslocally.The BritishRed
Crossencouragesyourpeople tovolunteerwiththe foundingof the JuniorRedCrossin1924.
Tescooperatesbysellingretail productsinternationally.Theyhave manydifferenttypesof storesto
provide differentservices.Tescoextraare largerstoresthatsupplya higherrange andquantityof
products,Tescosuperstoresare the commonstore as theyare slightlysmallerthanTescoextraand
have a slightlysmallerrange of productsbutare commonlyfoundintowns,Tescometroare
betweenthe superstoresandextrainsize,theyare commonlyfoundinthe centre of acity,Tesco
expressare small storesinneighbourhoodstheycanbe foundinsmall residential areas. Tescoisa
PublicLimitedCompanythathasLimitedLiabilityfordebts.
The sector
The BritishRedCross worksinthe voluntarysectoras it helpsthe peopleinneedanddoesnottryto
gainany revenue;all profitsare puttowardshelpingpeople.
Tescois part of the private sector,theyaimtomake profitand part of theirrevenue isputtowards
makingmore and fasterprofit.
Purpose
Tescohave a purpose of makingprofit theirmissionstatementstates
“Our visionisforTesco to be mosthighlyvaluedbythe customerswe serve,the communitiesin
whichwe operate,ourloyal andcommittedstaff andour shareholders;tobe a growthcompany;a
modernandinnovative companyandwinninglocally,applyingourskillsglobally”.
They want to be strongerand more competitiveintheirmarketprovidinganoutstanding
international service tothe customersandmeetingtheirneeds.Tescostate thatpricesare falling,
productqualityisincreasing,productrange isincreasingandservice levelsare improving.
On the Tescowebsite theystate theyhave asevenpartstrategyto increase longtermgrowth. One
of these strategy’sistogrowthe UK core; to continue tobe the largestbusinessisinthe UKand
drivessalesand profitalso withthe opportunitiesforfurthergrowththeysaythe core will continue

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Lewis Appleton 5 Miss Johnston
to grow.Anotherpart of theirstrategyisto be a creator of highlyvaluedbrands;the brandevolved
froma fewstorestomultiple typesof stores,brandsgive the businessmore meaningwiththe
customersandalsoreferto otherproduct brands.
The BritishRedCross isdedicatedtohelpingpeople acrossthe world;theysupported439,600
people inthe UKwithhealthandsocial care issues.The BritishRedCrossraise moneytouse on the
people inneed.Theyare aglobal businessandhelppeoplearoundthe world. The BritishRedCross
are aimingtomake an impact onthe worldbyprovidingaservice thathelpspeople,theyaimto
raise awarenessof the organisationforwhatitdoessothat more people are able tobe helpedbyte
organisation.
Ownership
Tescois a publiclimitedcompany (PLC).Youcansee thisby visitingtheirwebsite
(www.tescoplc.com).The businessisinthe private sectormeaningthat itisownedbyprivate
citizens. Tescoisable tohave the benefitsof havinglimitedliability.Thismeansthatif theywere to
fail as a businessthenonlythe moneyinvestedislost. Itisalsoan international companybecauseit
has outletsthatoperate inmanycountriesanditis an organisationthatisknownacrossthe world.
(Companynumber:00445790)
The BritishRedCross isa global companythatworksinthe voluntarysector,itisrun bya groupof
trustees, andthis meansitisa charitable trust.Itis setup to use fundstosupportpeople inneed.
The trusteeshave reputationforbeingresponsiblecitizensandare therefore able tobe volunteers.
Charitieshave toregisterandproduce accountson an annual basis. “The BritishRedCrossSociety,
incorporatedbyRoyal Charter1908, isa charityregisteredinEnglandandWales(220949) and
Scotland(SC037738)”.
Benefits and Disadvantages
The advantagesof Tesco havingthe ownershipof beingaPLCand beinginthe private sectorare that
the businessisfirstlyownedbyshareholdersandindividuals,withprofitbeingtheirmainobjective
theycan aim to achieve it.Althoughthe companyisownedbyshareholders,Tescohasthe
advantage thatit’sthe managersanddirectorsthat control the businessandmake valuable
decisions.
There are alsodisadvantages,aimingonlytomake profitcouldbringdissatisfactiontocustomers
and theywill lose positive feedbackandvaluable customers,thustheirprofitwill decrease.The large
disadvantage of thisisthatthe businesscontrol canbe lostbythe original shareholders if atakeover
bidtakesplace whichare large quantitiesof shares.
The advantagesof The BritishRedCrossbeinga charitable trustare that theycan relyon donations
and use themto helppeople,theygainnoprofitasit isall put intothe companybut thiswaythey
don’trisklosinganythingeither.
The disadvantagesof beinga charitable trustare,firstlyit’shardto findpeople thatwill volunteerto
workso some workersmayhave to be paid,secondlyit’shardto getthemselvesheardbecause if

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Lewis Appleton 6 Miss Johnston
theywantto helppeople theyare goingtoneedequipmentandalsotheydonotgainany revenue
since itis all putintomakingthe companybetterand quicker.
Ownership differences
Charitable trustsare verydifferenttoPLC’sbecause theyaimonhelpingpeople andputall the profit
intomakingitmore efficientandmore friendlyas abusiness,whereasPLC’saimtomake profit,they
sell sharesonthe stock marketanduse part of theirprofittomake theirbusinessmore efficientin
speedandquantityof makingprofit.
Conclusion
To conclude my assignment,businessescanmake large profitbecause of revenue fromsellingshares
on the stock marketand there are alsothe advantages thatshareholdersgetlimitedliabilityandalso
that banksare willingtolendlargeramountstothissectorof businessif the capital share theyhave
islarge.Thisis the reasonthat Tescois such a successful businessinthe private sectorandnow has
as many storesasit does;theysell theirsharesonthe stockmarketand keeptheirvaluesclear.