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Type Of Business organisation - Coggle Diagram
Type Of Business organisation
Sole trader
Definition of a Sole Trader
Sole Trader is a business owned and operated by just one person.
Advantage of being a Sole trader
There were few legal regulations for the sole trader to worry about when he set up the business
He is his own boss
He has the freedom to choose his own holidays
He does not have to share his profit
He does not have to give information about his business to anyone else but the tax office
Disadvantage of being a sole trader
no one to discuss business matters
Have unlimited liability
Business likely to remain small bacause capital for expansion is so restricted
Bank are most likely not going give you any loans
Partnership
Disadvantage of a partnership
Loss of Autonomy
Emotional issues
Lack of stability
Future selling complications
Advantage of a partnership
More capital could now be invested into the business
The responsibilities of running the business were now shared
Limited liability
Definition
A partnership is a group of at least two people who agree to own and run a business together
Share Holder
The owners of a limited company. They buy sharesd which represent part ownership of the company
Private limited companies
businesses owned by shareholders but they cannot sell share to the public
Public limited companies
business owned by shareholders but they can sell shares to the public and their shares are traceable on the stock exchange
Franchise
a business based upon the use of the brand names promotional logos and trading method of an existing successful business
Franchisee
buys the licence to operate this business from the franchiser
Joint venture
is where two or more businesses start a new project together, sharing risks and profit
public corporation
is a business in the public sector that is owned and controlled by the state