Business studies coursework, unit 1, task 1- the business at work. Project on Boots plc

UNIT 1

THE BUSINESS AT WORK

THE

BOOTS

COMPANY

1. BUSINESS CLASSIFICATION

1. Introduction

The Boots Company is a business found in the Private Sector of which it is a company. Businesses in the Private Sector are not owned by the Government, but by a private owner. Within the private sector, there are two main types of company, which are similar, but in many ways obviously different. Boots is a Public Limited Company (PLC), and not a Private Limited Company (Ltd).

Being a PLC enables The Boots Company to quote shares on the Stock Exchange, hence these shares are available to be purchased by the public, bankers, prospective investors and competitors, therefore establishing the shareholders as the company owners. This is seen as beneficial to the company, as it allows capital to be easily raised in comparison to Ltd companies (i.e. a business without shares being available to the public), and so the main difference between a PLC and an Ltd is the source of financial support.

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2. Identity

Public Limited Company

The main similarities between a PLC and a Ltd is the liability of the owners (shareholders), and their control they have over the business. Becoming a company means that you reduce your liability, and you are classed as having Limited liability. This means that the owner is liable to pay out the value invested by the public in the case of debt. On the other hand, directors who control the company are not all reliable for the debts they may create. Before it can start in Business, or borrow money, a PLC must satisfy Companies House that at least £50,000 worth of shares have been issued, and £12,500 of that amount must be paid directly into the company. It will then receive an authorization to commence business and...