Ownership and location
The type of ownership that Tesco has is in the private sector. It is a public limited company. The reason for Tesco being a public limited company is so the organisation can make a profit by being able to sell shares on the stock exchange. An advantage of being able to sell shares is if the business is doing well the share value will rise in value. Tesco also have “limited liability” which means that the owners and shareholders of Tesco are not personally responsible for the business’ debt and will not have anything repossessed etc.
Tesco will use economies of scale for their advantage because they will be able to buy more at a time and borrow cheaper and this is an advantage because it means that they can sell the product for cheaper than a competitor may sell the same product. A disadvantage of selling shares is if the business is not succeeding the value of the shares will drop in value and means Tesco will not get as much per share as usual.
Another disadvantage is that Tesco has a possibility of takeover because the shares can be bought by anyone and this might cause an argument over who has more power to the company. Chelmsford College Advantages Chelmsford College is owned by the government which means it comes under the public sector. This means that it is not there to make a profit and all the money that comes into Chelmsford College is paid by taxes. There is no liability involved if you work in the public sector which means that the business’ debt will not have any action taken because it is run by the government.
Chelmsford College doesn’t have to worry about the economy as much because it doesn’t affect them for example they would not have to take notice about the credit crunch or any problems that is going on except if the government has money to spent elsewhere. Disadvantages A disadvantage of being in the public sector is that if you go over the budget you may be restricted to future funding to make up for the expenditure before. The student numbers affect the funding that the college get so if students are not coming in or they are sick the funding will go down and will affect the budget that the college gets.
If the government have anything else they would have to spend money on for example if the country goes to debt that may mean the college funding money may be reduced. The location is based upon where the customers are maybe looking at where a lot of secondary schools are and get the students from there. It is also depending on the transport for customers for example if it easy for students to get in by bus and whether there are enough buses. They may depend on whether there are enough alternatives in the region to support the government education policy.