definitions
shareholder
a person or institution owning shares in a limited company
public corporation
a business enterprise owned and controlled by the state
cooperatives
- all members can contribute to running the business and sharing the workload
- profits are shared equally amongst the members
joint ventures
- teams may not blend well together
- errors and mistakes might lead to one company blaming the other
- business failure of one partner would put the whole project at risk
command economy
economic resources are owned, planned and controlled by the state
partnership
a business formed by two or more parters to carry on a business together, with shared capital investment shared responsibilities
joint ventures
- costs and risks of a new business venture are shared
- different companies might have different strengths, so they fit well together
- might have major markets in some countries and they could exploit these with the new product effectively
cooperatives
- poor management skills
- capital shortages as sale of shares to non members is not allowed
- slow decision making
limited liability
the only potential loss a shareholder has, if the company fails, is the amount invested in the company
sole trader
a business in which one person provides the permanent finance and has full control of the business and can keep all of the profits
public limited companies
- limited liability
- continuity
- seperate legal identity
- easy to sell and buy shares; encourages investment
- substantial capital can be raised
franchises
- a share of the profits has to be paid to the franchiser every year
- initial franchise licence fee can be expensive
- franchisee cannot choose which supplies or suppliers to use
unlimited liability
business owners have full legal responsibility for the debts of their business
joint venture
two or more businesses agree to work closely together on a particular project and create a separate business division to do so
sole trader
- easy to set up
- owner has complete control
- owner keeps all the profits
- owner makes all important decisions
- owner can establish close relations with staff
partnership
- unlimited liability
- profits are shared
- no continuity in case of the death of one of the partners
- all partners are bound by the decisions of one of them
- not possible to raise capital by selling shares
franchiser
a person or business that sells the right to open stores and sell products or services, using the brand name and brand identity
social enterprise
a business with mainly social objectives that re-invests most of its profits into benefiting society rather than maximising returns to owners