Please enable JavaScript.
Coggle requires JavaScript to display documents.
types of business ownership, less paperwork - Coggle Diagram
types of business ownership
partnership
advantages
at least two owners
less workload
shared responsability
more free time
better work life balance
more shared expertise
higher versatility in business
less unlimited liability
debt is shared between owners
higher capital
more than 1 person investing
disadvantages
shared profits
can cause disagreements
less rewarding
less control of business
must consult others before deciding
decisions take longer
unlimited liability
puts personal assets at risk
less stability
if a partner leaves the business it can lead to failure
reliant on others to pull their weight
exapmles
law firms
dentists
john lewis
public sector
advantages
job stability
loyal employees
better pension plans
tax funded
higher budget
high capital
no need for profit
purpose driven work
tax exemptions
positive work life balance
disadvantages
relies on government funding
can lead to budget cuts
political interference
slow decision making
usually pyramid structure
low control for owners
EXAMPLES
NHS
charities
private limited company
advantages
decreased risk
limited liability
personal assets aren't at risk
risk spread to shareholders
professional image
trust from customers
more employment applications
more opportunities for mergers and partnerships
control over who owns shares
greater access to funds
disadvantages
hard and expensive to set up
requires high capital big investment
high amounts of paperwork
high maintenance costs
complex administration
slower decision making
long chain of command
less control for owners
required to disclose financial information publicly
-
sole trader
advantages
able to keep profit
being own boss
relatively cheap and easy to set up
accessible
high control over business decisions
can make decisions quickly
no need to consult others to decide
privacy
financial information isn't publicaly available
disadvantages
unlimited liability
puts personal assets at risk
can lead to debt
high workload
less free time
health issues
slower growth
tax disadvantages
higher tax at higher income
less access to finance and investment
examples
freelance workers such as: writers, graphic designers, plumbers, electricians, mechanics
food trucks
restaurants
public limited company
advantages
lower risk
limited liability
shareholders have a stake in the business meaning risk is spread to shareholder base
raising capital through public issues of shares
growth and expansion opportunities
pursue new products and markets
capital expenditure
make acquisitions
makes a business more prestigious and trustworthy
disadvantages
less control
usually large organisation structures
long chains of command
must satisfy shareholders
anyone can acquire the business by having majority shares
hard to set up
high ammounts of paperwork
requires more funding
required to disclose financial information publicly
less paperwork