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Business ownership - Coggle Diagram
Business ownership
Sole Trader
Disadvantages
Unlimited liability, liable for all the business debt
Long working hours, and not many opportunities to have holidays as you are the boss, and you cant really stay off if you are sick eother
Banks don't normally lend money to small businesses, so growing financially will be quite hard
Advantages
You get to keep all of the profit to yourself, and you don't have to share the money to anyone
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Your are your own boss, meaning you make the decisions, and you choose when you want to work
Characteristics
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One person own the business, they can employ as many people as they want
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Partnership
Advantages
More finance can be raised in the business, and more partners can buy in the business
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Disadvantages
Argument sand disagreements are more common in partnerships, meaning it can take longer for agreements to be made
If one partner acts badly, the business has a chance of suffering, which will result in a bad reputation for the store.
Unlimited liability, they are liable for all of the business debt
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Public Limited company
Disadvantages
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Both require documents that take time to produce and usually require and expert to produce them at a high cost
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Characteristics
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directors tend to run the business, and be shareholders too
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Advantages
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Limited liability, shareholders are only liable for the company debt according to the proportion they have invested into the business
Private Limited company
Disadvantages
Both the required documents needed take time to produce and usually require an expert to produce them meaning they are expensive
Restricted on who can buy into the business, it could be difficult to raise finance for the business
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Characteristics
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Tend to be medium sized businesses, and they will end it 'LTD'
Directors run the business, and tend to be shareholders too.
Advantages
Limited liability, shareholders are only liable for the company debt according to the proportion they have originally invested into the business
Only family or friends can be shareholders of the business meaning they will be known to the business, and be seen as trustworthy
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