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UNIT 1 Business Activity - Coggle Diagram

- - - - Keeps all profit
      - Own boss/makes all decisions
      - Easy to set up - no legal documents
      - Finances kept private
    - - Unlimited liability
      - Harder to raise finance as seen as risky
      - Can be stressful/long hours
      - Business ends with owner's death
  - - - Share workload - specialise in different business functions
      - Only need Deed of Partnership to set up
      - More capital than sole trader to start up
      - Finance kept private
    - - Share profits
      - Potential arguments/disagreements
      - New partnership needed if when partner leaves
      - Unlimited liability
  - - - Limited liability
      - Seen as less risky so easier to raise finance
      - Know shareholders as invited
      - Continuity
    - - Finances are public
      - Raising of capital may be limited
      - Expensive legal documents to set up
  - - - Limited liability
      - Ability to raise large amounts of capital
      - Continuity
    - - Finances are public
      - Risk of takeover
      - Expensive legal documents for setting up
- - - - Loss, debt, business failure
    - - Profit, wealth, income, revenue
  - - - Poor health, poor relationships
    - - Self-satisfaction, making a difference, independence
- - - - Want profit and growth of business
    - - Want fair pay and working conditions
  - - - Want taxes and creation of jobs
    - - Want fair prices, range of products, good service
    - - Want job creation, low impact on environment
    - - Want prompt payment, fair prices
- - - - Less risky - own pace
      - Keep culture
      - Economies of scale
    - - Slower growth
      - Opportunities may be missed
      - Limited growth due to vision, knowledge, finances
  - - - Same stage of production process
      - Advantages
        
        Understand market and consumers
        
        Reduces competition
        
        Stops one company of going out of business
      - Disadvantages
        
        Culture clash
        
        Communication issues
        
        May result in less choice and higher prices
    - - FORWARD
        
        Moving towards customers
        
        Advantages
        
        Ensures supply chain towards customers
        
        Better understanding of customer needs
        
        Controls market and prices
        
        May create entry barriers/reduces competition
        
        Disadvantages
        
        Culture issues
        
        Communication issues
        
        Lack of knowledge of market - increased costs
      - BACKWARD
        
        Moving towards suppliers
        
        Advantages
        
        Ensures supplies - quantity and quality
        
        Reduces costs of supplies
        
        Control market and prices
        
        May create entry barriers
        
        Disadvantages
        
        Communication issues
        
        Culture issues/ethics
        
        Lack of knowledge - increased costs
    - - Different types of businesses/different stages of production
      - Advantages
        
        Spreads risk - sales in different markets
        
        Reduces ocmpetition
        
        Market power/control
      - Disadvantages
        
        Culture clashes
        
        Communication issues
        
        Lack of knowledge - increased costs