Categorisation Flashcards
What are the types of business organizations?
Public sector
Private sector
Unincorporated
Incorporated
Large or medium
Small
What is the Public Sector?
Involved in health & social care, education, defence, transportation, policing & justice, planning, public safety etc.
Part of the economy.
Provided by government.
Consists of national and local governments, their agencies and their chartered bodies.
What is the private sector?
Businesses whose main objective is to make money and generate a profit for the business owner(s).
Sometimes collective goal is not to make money but to help, support or improve the lives of individuals and groups.
What is an Unincorporated business?
In the private sector, there is a legal distinction between unincorporated and incorporated organisations.
No legal separation between the owner(s) and their business.
They are wholly responsible for the business and its liabilities (debts).
What is an incorporated business?
A legal entity in its own right, separate from its owner.
This limits the personal responsibility of the owners(s) for the businesses liabilities (debts).
Higher level of scrutiny from tax and competition authorities.
What is a small or medium business?
Small - less then 50 employees
Medium - 50-249 employees
Nearly 6 million small/medium enterprises (SME’s) in the UK in 2020 - that 99% of all businesses. 5.7m of these had fewer than 10 employees.
More than half of the UK’s workforce is employed by an SME.
What is a large business?
250+ employees
Only 8000 large organisations (40% of employment)
NHS is larger employer in the UK - in Jan 21 it employed 1.3million people (4% of the total employed workforce in the UK).
What is a For profit business?
Primary purpose is to generate profit and create wealth for their owners and shareholders.
Recently, some businesses are focusing on ethical and sustainable ways of achieving a profit (corporate social responsibility).
What is a not for profit business?
Aka third sector
Goal is to help and support individuals, groups and causes.
Charities, community groups, cooperatives and community groups are all examples of not for profit organisations.
