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Advantages and disadvantages of different forms of business. - Coggle…
Advantages and disadvantages of different forms of business.
sole traders ( Thorpe fish bar )
Quick and easy to set up - business can always be transferred to a limited company once launched.
simple to run - owner has complete control over decision making.
unlimited liability
Harder to raise finance - often have limited funds of their own.
the business is the owner - business suffers if the owner becomes ill.
can pay higher tax rate than a company.
partnerships ( WhatsApp )
quite simple
minimal paperwork
business benefits from the expertise and efforts of more than one owner.
provide specialist skills
unlimited liability
a poor decision by one partner can damage the interest of the other partners
complicated to sell or close
Public sector ( BBC )
faces little competition
provides goods and services for those members of the community who cannot afford them
often a lack of innovation
a change of government is likely to change funding's and spending's
public limited companies ( Tesco)
limited liability for shareholders
original owners loose control and ownership of the business
able to raise capital for expansion by selling shares
the more people who by shares in the business means the risk is spread out
high initial financial commitment
vulnerable to takeovers
limited companies ( John Lewis )
limited liability
professional status
can be complicated to set up
have to share decisions which shareholders
tax benefits
have to pay corporation tax