Unit 1 Assignment 1: Exploring Business
For this assignment, the two contrasting businesses where both businesses have different types of ownership and liability such as one being a for-profit business and the other one being a not-for-profit business. The two businesses are Tesco PLC and RSPCA which Tesco PLC is the for-profit business and RSPCA is the not-for-profit business.
Tesco PLC
The Tesco PLC website link is: https://www.tescoplc.com/.
RSPCA
The RSPCA website link is: https://www.rspca.org.uk/findapet#onSubmitSetHere.
Features
Ownership of Tesco PLC
The ownership of Tesco PLC is being a public limited company where a business is large and well-known which is what Tesco PLC is. This is a chain of retailers with some sort of branch in city centres. Being a public limited company means that shares are traded on the stock exchange which is where businesses such as Tesco PLC shares are traded on a centralised market. Shares from public limited companies such as Tesco PLC are offered to the public. Furthermore, shares are sold publicly to anyone.
An advantage of being a public limited company is having limited liability because of only being responsible to amount invested into Tesco PLC. Another advantage of a public limited company is being able to liquidate. This is when shares are bought or sold to shareholders if on the stock exchange it’s quoted. An additional advantage of a public limited company is the share value as Tesco PLC’s value will be shown by the market capitalisation from being the share price being what it’s based on. An extra advantage of a public limited company is having better access to capital because of the existing and new investor are raising share capital.
However, a disadvantage of a public limited company is that Tesco PLC has more chance to gain a much greater number of external shareholders. The company directors will be accountable for the external shareholders when listed on the stock exchange. Another disadvantage of a public limited company is that Tesco PLC has more greater scrutiny from the public of the financial performance and actions.
Ownership of RSPCA
The ownership of the RSPCA is being a charitable trust because the RSPCA is a registered charity that helps
Advantages- Less liability for stakeholders. Ability to raise funds/capital in the form of stocks as needed.
I will be relating the type of business, purpose and ownership of the two contrasting organisations. The two organisations that I will be choosing are: Oxfam and Sainsbury’s.
Tesco Plc is a Public Limited Company who securities and shares are included in the stock exchange and list of different countries. In UK, companies like Tesco Plc are registered under the companies Act 1980 and its shared are offered to public in regards of limited liability. In addition, Tesco is associated with retail sector that carries out a majority business of the company and contribute their share in country’s economy to a huge scale. Apart from the retail sector, Tesco Plc faced tough competition all over the world from companies like Wal-Mart, Asda, Sainsbury, and others. Although, Tesco is not in dominating position in the current retail market in the UK, but the company is one of the biggest retail companies working in the UK, North America, Asia, Europe and other. The company
Tesco PLC works in association with other groups, and the group financial statements consist of the financial statements of Tesco PLC (the ultimate Parent Company) and the Group’s share of its interest I joint ventures and associates. Also, where necessary, changes are made to the financial statements of subsidiaries, joint ventures and associates to bring accounting policies used into line with those of the Group.
In this assignment, I will explore different types of businesses. Some of these will include: Sole Traders, Private Limited Companies (Ltd), Public Limited Companies (Plc), Partnerships, Non-Profit Businesses, Franchises, Co-operatives. In this instant, I will be exploring a Public Limited Company. Tesco.
Tesco is a Public Limited Company which means anyone can buy shares from the stock exchange. http://www.shareview.co.uk/4/Info/Portfolio/Default/en/Home/Products/Pages/Buyandsellshares.aspx you can buy shares on this website. Tesco has to
Convenience/Burden- Like a general partnership a limited partnership is easily formed and can enjoy pass through-taxation. It can also be easier to get financing with a limited partnership. A downfall of the limited partnership is that the death of a general partner can dissolve the partnership unless a prior agreement has been established.
Tesco is a PLC which means it’s a public limited company therefore has limited liability. Limited liability is when only the money you invest is at risk and not your personal possession. Tesco is a British and Irish multinational grocery and general merchandise retailer and owns 27.8% of the market share in the United Kingdom. It has 6809 stores over 12 countries across Asia and Europe and it is a large company as it currently employs over 476,000 people worldwide. Tesco was founded in 1919 by Jack Cohen as a group of market stalls and on his first day he made a profit of £1 on sales of £4. The name Tesco came from
A plc has more chance to become successfully. The company produce goods at lower unit cost and has bulk purchasing and cheaper borrowing.
This is an advantage, because in this way shareholders are likely to invest more money in Tesco. Secondly, being a public limited company also means that Tesco’s shares are listed on the stock exchange, and members of the public can buy them. This is an advantage, because Tesco can raise large amount of finance and capital through issuing and selling shares. Thirdly, being a public limited company also means that Tesco can purchase shares of other companies. This makes it easier for Tesco to acquire other businesses and improve its own operations through the purchase of other businesses.
Due to limited liability, company creditors’ interests are not protected . Creditors need to bear the risks inherent when dealing with limited company. Shareholders are discouraged from monitoring and controlling the business due to the benefits of limited liability.
Tesco PLC, the top three retailer in the world, which was establish by Jack Cohen in 1919 year, which has near 100-Year history. In these days, it has been thrived to 12 country all over the world, including United Kingdom, Malaysia, India, Hungary, Ireland, Kipa, Slovakia, Poland, Czech, Thailand, even South Korea, and China (Tescoplc.com, 2012). Tesco is a public limited company. According to Marcouse (2011:92), “Public limited company (Plc) is a larger type of company that must have at least £50,000 of share capital and has its shares traded on the stock market”, therefore Tesco can have greater capital source and shareholders in their business.
As I have mentioned before, this research paper is being taken exclusively with the aim to evaluate the Tesco’s performance in both financial and business terms over a three years period. Since the financials will be compared with its three year
Tesco is the leading food retailer in Britain, they have also focused on building non-food sales which are available in store and online. Tesco is one of the world’s largest retailers with approximately 4,331 stores in 14 countries which include Asia, Europe and the United States. (Tesco, 2011). See appendix 1 for a map of the countries Tesco operate in.
Tesco has 164500 shareholders and its profit is about 505 million pounds after the tax has been deducted. Fifty per cent of its profit is distributed to the shareholders as dividends and the rest is held back for investment in stores and improving services for the customers.