Types of Businesses
What are the types of businesses?
Sole Trader, Partnership, Private Company, Public Company, Franchise, and Cooperative.
What is a Sole Trader?
A business owned and controlled by one person.
What is a Partnership?
A partnership is an association of people who carry on a business as partners and jointly receive income.
What are two types of a Company?
Public and Private Company.
What is a Franchise?
Franchises allow a business to operate under an established name and brand and sell its products and/or services.
What is a liability?
This refers to who is going to be liable for the debts of the business, should it get into trouble.
What is another name for a "Sole Trader"?
Sole Proprietor.
How many people are in a partnership?
Usually 2-3 people.
What are the advantages of a company?
More opportunity for expansion, higher profile in the business world, managed by qualified personnel, and limited Liability.
What is brand loyalty?
Easier to attract customers, and have a much lower risk of failure.
What are two types of liability?
Unlimited and limited.
What are the advantages of a Sole Trader business?
Easy to establish, low start-up costs, full control and ownership, flexibility to do what and when you want, cheaper accounting fees.
What are the advantages of a Partnership?
Low start-up costs, Shared capital, Shared workload, expertise and skill, Shared risk and responsibility, Shared decision-making, Partners retain all profit.
What are the disadvantages of a Company?
Double taxation – business and shareholders, complicated to set up, shareholders may lose control of the operations, and public companies must publish financial reports.
What is a Cooperative business?
A cooperative is a community enterprise owned and controlled by a number of people who have combined for a particular purpose.
Which businesses have an unlimited liability?
Sole Trader and Partnerships.
What are the disadvantages of a Sole Trader?
Added pressure, sole responsibility, long hours, financial pressures.
What are the disadvantages of a Partnership?
All partners responsible for debts of the other partners, Potential for conflict, Decisions of one partner binding on the others.
What is a fact about a public company?
A public company is one where shares can be sold to anyone in the public.
What is an advantage of a Cooperative business?
All members have equal say in decision making, inexpensive to register, and owned and controlled by members.
Which businesses have a limited liability?
Private and public companies.
What type of liability does a Sole Trader have?
Unlimited Liability.
What is a partnership agreement?
Are written documents that explicitly detail the relationship between the business partners and their individual obligations and contributions.
What is a fact about a private company?
A private company:
What is an advantage of a Franchise?
Provides association with established brand, reputation, product or service, Provides access to outlet design, equipment, operating and financial systems and procedures, Access to management and operational training.