Coursework assignment 1 – Tim - Exploring Business
P1: Explain the features of two contrasting organisations – Tesco and
Chestnut Tree House.
Ownership and liability
In businesses, there are two types of liability – limited liability and unlimited liability. Limited
liability is when the owners of a business are legally separated from the business. This
means that the owners cannot have their own possessions or assets seized to pay off a debt
owed by the business. On the other hand, unlimited liability is when the owner of a business
is not separate from the business. This means that if the business owes a debt, the owners'
possessions and assets are at risk of being repossessed to pay off the debt. Tesco is an
example of a business which has limited liability. The reason that Tesco has limited liability is
due to it being a PLC – a Public Limited Company. This means that Tesco as a business has
shareholders who technically own the business, and they are people that have bought
shares in the business and own some of Tesco in order to make a return on their
investments. This means that Tesco must have limited liability, as if there was a debt that
needed paying and they had limited liability, then everyone who has bought shares in Tesco
will be at risk of losing possessions and assets. However, because Tesco has limited liability,
this means that the debt can only be taken from the business itself. On the other hand,
Chestnut Tree House (CTH) is a charity limited by guarantee. This means that it does not
have shareholders, and instead it has trustees. These trustees pay just £1 to the charity,
allowing them to have limited liability. However, because it is limited by guarantee, this
means that the personal finances of the trustees are protected – as only the money that
they have invested into the charity (their guarantee) is at risk. As well as this, these trustees
are the people who advise the managers on any large financial decisions within the charity –
however they do not get paid for this, they are volunteers.
Sector of ownership
There are 3 sectors of ownership for different businesses. Public ownership is businesses
that are owned by the government. They offer public services and are funded by our taxes.
Examples of these are schools, the NHS, and our local police. Private ownership is businesses
that are owned by people – for example, a sole trader or a partnership. They are owned by
individuals, and they make their business to make a profit through the services and products
which they provide – for example shops. The voluntary sector is businesses which are usually
charities. Their money is raised by donations and fundraising, and any money above their
costs is called a surplus which goes back into the business. These are run by volunteers who
do not get paid.
Tesco is a business which is in the private sector of ownership. This is because it is made for
profit, and all privately owned businesses’ aim is to make maximum profit which goes back
,into the business to help it to grow – for example Tesco made £2.83bn profit in 2023. We
know that Tesco is a privately owned business as it has shareholders, and this means that
they want to make a profit as they buy shares and want the business to expand so that they
make a return on their shares.
However, CTH is in the voluntary sector of ownership. This is because its purpose is not-for-
profit, so they have to rely on donations and people volunteering to keep the charity running
– for example they hold fundraiser events like the Littlehampton 10k to raise money. As well
as this, we know that CTH is in the voluntary sector as their main aim is to provide support
to families with children who have life-limiting needs – so they aim to aid people’s lives, not
make a profit.
Sectors of industry
In the industry, there are four main sectors. These are primary, secondary, tertiary and
quaternary. The sector that your business is in depends on what your business does. In
simple terms, the primary sector is obtaining and growing the raw materials, secondary is
manufacturing and making the product, tertiary is providing a service, and quaternary is the
growth of new information. Tesco is a business which is in the tertiary sector of industry. We
can tell this because they are providing a service by selling people products. As well as this,
there are smaller parts of the Tesco business which are also tertiary – such as cashiers
scanning your shopping and employees helping customers find what they need. Similarly,
CTH is also in the tertiary sector as they are providing a service – they are supporting parents
of children who have life-limiting disabilities or illnesses, as well as the children themselves.
Business scope and size
The scope of a business is the area in which the business operates and is providing a service.
There are 3 main scopes, which are local, national, and international. Local businesses are
usually smaller businesses who are owned by people who live in the area, and the business
usually serves the people who live in the local area. CTH is an example of a local business. -
this is because they only really help families who live around the areas of Sussex, Brighton,
and South-West Hampshire. The second largest scope of business is national. National
businesses are businesses which operate on a nationwide scale and will have multiple
branches in various locations across the country. Tesco is an example of a national business.
National businesses are often far larger businesses which have larger, less niche target
markets and bring in more profits. Tesco is clearly a national business as they have around
4,250 stores across the UK. The final scope of business is multinational/international. These
are the largest type of business and provide a service/product to a global market and make
business transactions across national borders – for example McDonald’s or Apple.
The size of a business depends on the number of employees working for the business. There
are 4 different sizes of business, these are micro, small, medium, and large. A micro business
is one which has below 10 members of staff working for them. A small business is from 10-
, 49 employees, and medium is from 50-249. These first 3 business sizes are known as SME’s -
small and medium enterprises. The final business size is large, which is anything above 250
employees. Tesco's is an example of a large business. We know this because they have over
330,000 employees at Tesco's – ranging from regional managers to store assistants. On the
other hand, CTH is classed as a medium sized business as it has around 60 employees. There
are many different types of employees at CTH, ranging from the chief executive to activity
leaders and family councillors.
P2: Explain how two contrasting businesses are influenced by stakeholders
Stakeholders are defined as groups/ individuals who have an interest in a business and its
activities - such as how well the business performs and how the activities of the business
might impact them. They can be either internal or external to a business, and some people
may be both at the same time, for example an employee of Tesco (internal) may also shop
there (external). There are some different stakeholders for Tesco and CTH, however many of
them are the same. These are all the stakeholders for both businesses:
Tesco only:
Shareholders
Shareholders in Tesco are people who have bought shares in the company. They do this to
make a return on their investment, for example if the share price goes up because Tesco is
making more profits and sales, they will receive more returns and dividends. They would
expect a financial gain from being a shareholder, so therefore have a financial interest in the
business. In large firms, there are often thousands of shareholders in the business who all
want the business to do well – as profits go up, their share prices will because more people
are buying shares.
Customers
Customers will have an interest in Tesco as they want to buy the products offered in their
shops. They would expect to have excellent quality products which are always available
when needed as well as affordable, as well as to experience good customer service and an
overall positive shopping experience where their needs are being fulfilled.
CTH only:
Trustees
Trustees are a group of people who work for CTH. They ensure that all financial decisions
made by the business are wise and will benefit the business. The trustees have a financial
interest in the business, similar to shareholders in Tesco - as they are important in making
sure that the charity does well and spends their money on well-needed things.
P1: Explain the features of two contrasting organisations – Tesco and
Chestnut Tree House.
Ownership and liability
In businesses, there are two types of liability – limited liability and unlimited liability. Limited
liability is when the owners of a business are legally separated from the business. This
means that the owners cannot have their own possessions or assets seized to pay off a debt
owed by the business. On the other hand, unlimited liability is when the owner of a business
is not separate from the business. This means that if the business owes a debt, the owners'
possessions and assets are at risk of being repossessed to pay off the debt. Tesco is an
example of a business which has limited liability. The reason that Tesco has limited liability is
due to it being a PLC – a Public Limited Company. This means that Tesco as a business has
shareholders who technically own the business, and they are people that have bought
shares in the business and own some of Tesco in order to make a return on their
investments. This means that Tesco must have limited liability, as if there was a debt that
needed paying and they had limited liability, then everyone who has bought shares in Tesco
will be at risk of losing possessions and assets. However, because Tesco has limited liability,
this means that the debt can only be taken from the business itself. On the other hand,
Chestnut Tree House (CTH) is a charity limited by guarantee. This means that it does not
have shareholders, and instead it has trustees. These trustees pay just £1 to the charity,
allowing them to have limited liability. However, because it is limited by guarantee, this
means that the personal finances of the trustees are protected – as only the money that
they have invested into the charity (their guarantee) is at risk. As well as this, these trustees
are the people who advise the managers on any large financial decisions within the charity –
however they do not get paid for this, they are volunteers.
Sector of ownership
There are 3 sectors of ownership for different businesses. Public ownership is businesses
that are owned by the government. They offer public services and are funded by our taxes.
Examples of these are schools, the NHS, and our local police. Private ownership is businesses
that are owned by people – for example, a sole trader or a partnership. They are owned by
individuals, and they make their business to make a profit through the services and products
which they provide – for example shops. The voluntary sector is businesses which are usually
charities. Their money is raised by donations and fundraising, and any money above their
costs is called a surplus which goes back into the business. These are run by volunteers who
do not get paid.
Tesco is a business which is in the private sector of ownership. This is because it is made for
profit, and all privately owned businesses’ aim is to make maximum profit which goes back
,into the business to help it to grow – for example Tesco made £2.83bn profit in 2023. We
know that Tesco is a privately owned business as it has shareholders, and this means that
they want to make a profit as they buy shares and want the business to expand so that they
make a return on their shares.
However, CTH is in the voluntary sector of ownership. This is because its purpose is not-for-
profit, so they have to rely on donations and people volunteering to keep the charity running
– for example they hold fundraiser events like the Littlehampton 10k to raise money. As well
as this, we know that CTH is in the voluntary sector as their main aim is to provide support
to families with children who have life-limiting needs – so they aim to aid people’s lives, not
make a profit.
Sectors of industry
In the industry, there are four main sectors. These are primary, secondary, tertiary and
quaternary. The sector that your business is in depends on what your business does. In
simple terms, the primary sector is obtaining and growing the raw materials, secondary is
manufacturing and making the product, tertiary is providing a service, and quaternary is the
growth of new information. Tesco is a business which is in the tertiary sector of industry. We
can tell this because they are providing a service by selling people products. As well as this,
there are smaller parts of the Tesco business which are also tertiary – such as cashiers
scanning your shopping and employees helping customers find what they need. Similarly,
CTH is also in the tertiary sector as they are providing a service – they are supporting parents
of children who have life-limiting disabilities or illnesses, as well as the children themselves.
Business scope and size
The scope of a business is the area in which the business operates and is providing a service.
There are 3 main scopes, which are local, national, and international. Local businesses are
usually smaller businesses who are owned by people who live in the area, and the business
usually serves the people who live in the local area. CTH is an example of a local business. -
this is because they only really help families who live around the areas of Sussex, Brighton,
and South-West Hampshire. The second largest scope of business is national. National
businesses are businesses which operate on a nationwide scale and will have multiple
branches in various locations across the country. Tesco is an example of a national business.
National businesses are often far larger businesses which have larger, less niche target
markets and bring in more profits. Tesco is clearly a national business as they have around
4,250 stores across the UK. The final scope of business is multinational/international. These
are the largest type of business and provide a service/product to a global market and make
business transactions across national borders – for example McDonald’s or Apple.
The size of a business depends on the number of employees working for the business. There
are 4 different sizes of business, these are micro, small, medium, and large. A micro business
is one which has below 10 members of staff working for them. A small business is from 10-
, 49 employees, and medium is from 50-249. These first 3 business sizes are known as SME’s -
small and medium enterprises. The final business size is large, which is anything above 250
employees. Tesco's is an example of a large business. We know this because they have over
330,000 employees at Tesco's – ranging from regional managers to store assistants. On the
other hand, CTH is classed as a medium sized business as it has around 60 employees. There
are many different types of employees at CTH, ranging from the chief executive to activity
leaders and family councillors.
P2: Explain how two contrasting businesses are influenced by stakeholders
Stakeholders are defined as groups/ individuals who have an interest in a business and its
activities - such as how well the business performs and how the activities of the business
might impact them. They can be either internal or external to a business, and some people
may be both at the same time, for example an employee of Tesco (internal) may also shop
there (external). There are some different stakeholders for Tesco and CTH, however many of
them are the same. These are all the stakeholders for both businesses:
Tesco only:
Shareholders
Shareholders in Tesco are people who have bought shares in the company. They do this to
make a return on their investment, for example if the share price goes up because Tesco is
making more profits and sales, they will receive more returns and dividends. They would
expect a financial gain from being a shareholder, so therefore have a financial interest in the
business. In large firms, there are often thousands of shareholders in the business who all
want the business to do well – as profits go up, their share prices will because more people
are buying shares.
Customers
Customers will have an interest in Tesco as they want to buy the products offered in their
shops. They would expect to have excellent quality products which are always available
when needed as well as affordable, as well as to experience good customer service and an
overall positive shopping experience where their needs are being fulfilled.
CTH only:
Trustees
Trustees are a group of people who work for CTH. They ensure that all financial decisions
made by the business are wise and will benefit the business. The trustees have a financial
interest in the business, similar to shareholders in Tesco - as they are important in making
sure that the charity does well and spends their money on well-needed things.
