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Business types - Coggle Diagram
Business types
Sole trader
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advantages:
quick and easy to set up
owner has control over all decision making
easy to shut down/close:
Disadvantages:
unlimited liability
more difficult to raise finance
can pay a higher tax rate than a company
Partnership eg. Apple
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Disadvantages:
unlimited liability
harder to raise finance
a poor decision by one partner damages the interests of other partners
Advantages:
very simple to start for two or more people
business benefits from knowledge of more than one owner
partners can provide specialist skills
greater potential to raise finance- partners each provide investment
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Ltd eg. John Lewis
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Disadvantages:
growth may be limited by max of 50 shareholders
shares can’t be sold or transferred to anyone without agreement of other shareholder
Public sector eg. NHS
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Disadvantages:
often a lack of innovation because there is no profit motive
a change of government can lead to change in funding and spending