Investigating Two Types of Businesses

Investigating Two Types of Businesses

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Investigating Two Types of Businesses

In this report in am going to investigate The Body Shop and Interlink
which are two different types ownership PLC (Public limited company)
and a Sole Trader.

[IMAGE]Task 1a)

Information about each of the companies

THE BODY SHOP plc ©2003

The Body Shop rapidly evolved from one small shop in Brighton on the
south coast of England, with only around 25 hand-mixed products on
sale, to a worldwide network of shops. Franchising allowed for rapid
growth and international expansion as hundreds of entrepreneurs
worldwide bought into Anita's vision.


[IMAGE]Interlink was opened in Vallance Road E1 by my uncle M.K Azad
he started with two computer and one phone box and a couple of phones
card the company grew larger and larger over the years until there was
20 computer and 15 phone boxes.


The body shop is a PLC but is does franchise which basically means way
of owning a business but not taking the normal risk of buying
expensive goods. I think the main the benefit of being a franchise is
that if the body shop is successful as in getting more money the
shares will increase in value, which will increase the overall value
of the company so this mean that is the company get more money the
body should could invest or it could open more franchise but I think
it would be more better if they open more franchise it would give a
name to the company. Also the body shop can often operate more cheaply
than a Sole trader as the operate on "Economies of sale" because if
the body shop buy 100 Bags they would but it in bigger quantity which
means the bigger the buy the cheaper it get, whereas a sole trader the
price will increase because they are buying a small amount than the
body shop.

But the body shop has some disadvantage for because of unwanted taker
over people from outside of the company can buy shares in the company

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and if they are able to get at least 51%, then they can have a say in
the company.

[IMAGE]Also an annual meeting (AGM) must be held each year and the
entire shareholder must be invited. Shareholder who doesn't agree in
which way the company is managed may raise objection or choose against
a proposal made by the directors.


Although the body shop operates franchises the owners have limited
liabilities. Limited liability mean that, if the business goes
bankrupt because it is unable to meet its debts, the share holder/
owner will not be to lose their possessions to pay the money that is
owned. The maximum amount they could lose is the amount they have to
put in to there share.

[IMAGE]The advantage of Interlink is that a sole trader is very easy
to set up. Also a sole trade is his or her own boss and does not
receive any order for anyone. A sole trader a work for as long as they
want to also the can choose what day they want to work, there are
minimum of paper work

There are also some disadvantages for Interlink for instance you have
to work long hours i.e. if you don't meet you target profit then this
mean that you are losing profit which could also mean extra hours.

If my uncle is sick this would cause a great deal because this would
mean he is losing money, which is very bad and could harm the
business. The owner has unlimited liability for any debts this means
id the business is unsuccessful the owner have to sell personal
possession (house, cars e.t.c).


Interlink provide a service, he provide a service by letting people
use the Internet and using phone to call other countries.

The reason why my uncle is a sole trader is because he wants to keep
all the profit to himself and not give it to any one else. He knew
that a sloe trading would easy to setup. I asked my uncle why don't
you make a limited company and he said he wanted to keep it small
because he wanted to improve his financial status. Also he preferred
to make the decision him self and not any one else basically he wanted
to run the business the way he wanted it.

The body shop sells hand made product, which have not been tested on
animal because the shop strongly doesn't agree whit animal testing.

The reason why the bodies shop suites its ownership is because the
body shop is a franchise so it keeps on opening new shop and I think
this is good because this will increase the profit of the company.

The only reason why the body is a franchise is that it doesn't need to
find any outlet the franchisee would find it without the help of the
franchisor also the franchisee would work hard for the success of the


All business belongs to three main sectors it doesn't matter whether
they are private or public:

Primary industry - That part of the economy concerned with agriculture
and the extraction of raw materials

Secondary industry - That part of the economy concerned with the
manufacture of goods

Tertiary Industry - That part of the economy concerned with the
provision of services

[IMAGE]The Primary sector

The primary sector, whose goods are sold in commodity markets, forms
the basis of many developing economies. As economies develop the
primary sector becomes less important and the secondary and tertiary
sectors take over

Many primary products are "non-renewable": which basically means
limited in supply and will eventually be completely run out

Secondary sector

[IMAGE]The secondary sector, whose goods are sold in consumer, in
recent decades the secondary sector, has declined in importance for
many developed economies. Certainly in the UK, the secondary sector,
and manufacturing in particular, has rapidly declined in importance.
Operating in the secondary sector poses many problems, but
increasingly the key issue for UKmanufacturers is that of adding value
to their products. Faced with cheaper imports from developing
economies like Bangladesh.

The secondary sector is that of ensuring they can turn raw materials,
into something that consumers will pay for example tables cars glass.

In the UK we have examples of successful secondary sector businesses
e.g. Dyson who manufacture vacuum cleaners and washing machines. But
equally we have many examples of secondary sector business that have
failed to stay "one step ahead" of the competition. The motor vehicle
industry is possibly an example of this.


The Tertiary sector

The tertiary sector, whose service is sold in consumer .In recent
decades the tertiary sector has increased in importance for many
developed economies, In the UK the tertiary sector is by far the
biggest proportion of the economy. Operating in the tertiary sector
poses similar problems to that of the secondary sector: they still
need to add value to their products and they still face competition.

Yet because a good deal of service sector business requires "face to
face" contact with the customer, it is a little harder for overseas
competition to take customers away. More significant is the idea that
much of the service sector is based on the knowledge economy i.e. that
knowledge and information is worth money and those who posses it have
the upper hand.

One good example of this is the Banking industry, which has gone
through enormous changes in recent years. Using information and
communication technology, banks have vastly reduced the number of
staff they need. Many banks and building societies have merged to form
much leaner businesses capable of extracting more profit from a wider
customer base. The key to this process is gaining information about
their customers and constantly communicating new products to them.

2b) The body shop belongs in two industrial sectors which are
Secondary and tertiary because they pack their products and sell them
in their shop.

Interlink is only in the tertiary sector the tertiary is split in to 4
groups public service, financial and business service, transport and
communication and retailing, distribution, hotels and catering and
Interlink Belong Into uncle belong to the retailing.

2c) There are also other business in the same sector as mine these
include businesses like Iceland, Safeway's, Ford, Honda e.t.c

Interlink belong in the tertiary sector He provides a service here are
some other business that provides a service, Adam's solicitors
Shadwell, Hair dressers e.t.c

2d) This chart below show the UK employment by sectors (1989-1997)

Graph A Employment trends


























As you can see in graph and it show how many people were employed
through 87-97 the reason why I have chosen this graph is because I
couldn't find the most up-2-date records.

In this graph it shows that the tertiary sector is increasing so this
means that there are more jobs in this sector, however the primary and
secondary sector is decreasing because it show that there are more and
more people moving to the tertiary.

Graph b What is produced by these sectors


























As you can see in this graph it shows what each sector is producing.

You can see that the primary sector is declining this show that there
are less products being produced whereas in the tertiary sector it so
a slow increase the reason why I think this is because if there are
less people in the primary and the secondary sectors because they have
moved in to the tertiary sector so there out put has increased because
there a many more people working in this industry.


[IMAGE]The Body shop Core business is to sell hand mixed products to
people in 50 countries; this is the biggest income for the business
because this is there main activity. The business carries out these
activities buy placing adverts in international and national
newspapers, internet also on bill boards this will bring customers
into the business and this will help the body shop achieve its core
activities. Also the business carries out other activities for example
sell men aftershave also they sell Home Fragrance, they sell hair
products, and it isn't just an ordinary shampoo it's made with fruits

In order to do this they have to buy a premise also they'll need some
equipment for example they would need EPOS (electronic point of sale)
Tills the reason why they would need this is because if a customs buys
a cream the system automatically updates the system basically they
could tell if one product has ran out so they could order new ones,
they would need members of staff like Sales assistance, manager,
supervisors e.t.c.

[IMAGE]Interlink is a Internet café

[IMAGE]The business has a lot of activities they do thing like
'Sending money all over the world' the reason why they do this is
because the shop is located in the Bengali community and Bengali
people always send money to the home land to help the parents also he
sell Air plane ticket to people he does this because some people go to
other countries and others go on HAJJ (holy pilgrimage) he sell the
air tickets at very low prices.

Interlinks core business activities is to let people use the internet
and use the phone booth to call international countries but it also
has other activates such as selling phone facieses.

In order to do this he need to buy a place in a suitable location then
he need to get some fast computer to cope with the T1 connection after
that he needs to get some phone booths and to enable international
call dialing.

He provide this by letting people come in to the some and use the
facilities he doesn't allow more than two people at the computer the
reason for this Is because if there are a lot of people next to the
computers one of them could brake and some might get stolen. The
opening hours for the shop are 9:00am to 10:00pm Monday to Sunday.

The beauty business in general is increasing because you could tell
this by how many out are open, here are some shops in the beauty
industries BOOTS AND THE BODY SHOP, these shop are everywhere because
male and females want them self to look good you could tell this when
you ever you go to a shopping center you would see a beauty shop
either BOOT or THE BODY SHOP also the other reason for this is because
there is more demand for beauty products and people don't wan tot
travel far distances.

Task 4 a,b,c

The body shop has many outlets for example there is one in Stratford
shopping centre London here is a map of the shopping centre also the
shopping centre has it own car park this is only available for people
who are willing to pay a small amount of money to park the car park is
situated very close to the shopping centre.

As you can see there are tube stations and a bus station this is good
for the customers they can travel by train, bus and car. The reason
why the body shop is located there is because they have done some
market research you could tell this because how many people go through
the shopping centre every day.

There are many factors that concern the business for example safety
they must have a fire exit the reason for this if there is a fires and
there is over 100 people in the shop where would they go? They would
have to go through the fire exit.

Interlink is located in Vallance Road E1, the shop is right next to a
School (3) and plus next to a street market (2) here is a map

As you can see it is very close to Whitechaple Tube Station (3) so you
could tell that many people are going to go to the shop because the
shop is advertised next to the tube station also there is a shopping
center close by. Interlink is very close to a street market this is
good because if someone need to phone another person they could go to
his shop and get a phone card.

There are many factors that concerns interlink for example Competition
because if there is another shop close by and they are doing the same
activities and interlink thee people might want tot go to the new shop
therefore interlink business will go down.

Task 5a

Stakeholders are individuals or groups who have an interest in what a
business does and either is affected by what the business does or
affects the business by what they do.

Who the stakeholders are for interlink?

Radial Diagram

Who are the stakeholders for The Body Shop?

Radial Diagram


[IMAGE]All of the stakeholder have an interest in the business for
example the employee are interested in wages and working conditions
because if the business did not pay the employees then the business
will crumble and employers like to work in a safe environment and if
the business did not provide that then it would loose employees and
then the staff turnover would be very high.

Also the communities are interested because if a new shop comes in the
community they this would mean less noise and crime because the
business would try to prevent Anti social Behavior.

Customers would be happy because if the business meets it needs they
the customer will all ways come back to the shop because it had the
right item that the customer wants.

Suppliers would have an interest because if they get a new client this
would mean money and if the supplier has money then they could keep
the cost low and it would help other business as well.
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