My Life - What Is the Chemical Factory?

The Chemical Factory: A Case Study

What is The Chemical Factory?

The chemical factory is a small business owned by Mr. Iain Sheen and the purpose of the business is to provide chemicals. It was set up 15 years ago by Mr Jackson Sheen. It first started off as a Limited Company (LTD), but as time passed the business started to expand so the owner decided to relocate to Smart Tech City, and therefore the company became a Public Limited Company (PLC). City Chemicals are a regional business and they are situated in the outer are of the city. The actual factory is located close to the railway lines and motorway which makes the delivery for of raw materials and finished goods to customers much more convenient.

What is the Purpose of the Chemical Factory?

The purpose of the chemical factory is to sell chemicals but Mr Sheen's plans are to have a factory outlet store in Smart Tech City.

The business is private and the sector of the industry falls in the tertiary side. The company generates a lot of money so the fact it has limited liability makes sure it is safe and less of a risk. The actual setup of the business was very expensive- £12, 000,000 and the source of funds from the old factory were around £6, 000,000. Also the government grant is £4, 000,000 and the city bank gives £2, 000,000.

The size of the business is small as it has around 95 employees working full time. Smart Tech City has a population of around £40, 000 people and around £10, 000 annual visitors.

Advantages and Disadvantages:

The advantages of this Chemical Factory is that you have limited liability so if any goes wrong in the business they will only lose their share values and not the things they posses. The shareholders can also keep a control over who buys shares in their company. The business has its own legal identity.

There are also disadvantages of a private limited company. They are that each year the business must produce a set of financial accounts to be checked by an independent accountant. Also they are more expensive to set up than a sole trader or a partnership, and the profits that are made have to be shared with other shareholders.