• Created by: Tashie7
  • Created on: 01-05-16 13:10
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  • 3.1- Business
    • A business is an organisation that is involved in any organised form of trade, industrial or professional activities and exist in order to achieve objectives such as profit, growth and survival.
      • A business's objectives should be SMART.
    • Forms of business
      • Sole Trader: An individual who owns and runs their own business.
        • Cheap and easy to set up, owner receives all profits and finance records are private.
        • Unlimited liability, limited capital for investment and jack of all trades.
      • Private Limited Company: is own by shareholders known to the company therefore cannot sell shares openly on the stock market.
        • Can't be taken over, finances are private and more capital can be raised through shares.
        • Shareholders are locked in, more complex to set up due to legal requirements and loss of control due to shareholder voting rights.
      • Public Limited Companies: shares are sold to the public via the stock exchange.
        • Able to sell shares for money which could be used to expand the business.
        • Risk of a hostile takeover, public are able to access finance accounts and loss of control.
    • Shareholders
      • Investors who are part owners of a company
      • Limited in liability to the amount invested or promised
      • Able to receive dividends in return for investment
      • Invited to AGM where they have a proportional voting right.
    • Shareprice
      • Infleunces
        • Global and national economy
        • Investor confidence
        • Political stabliity
        • Company performance
      • Significance
        • Indication of manager's performance
        • Influences stakeholders
        • Effects ability to raise finance from other sources
        • Will be watched carefully by competitors
        • Will effect consumer confidence
    • Mission statement and objectives.
      • A mission statement is a brief written statement of the purpose of a company of organisation
        • It ideally guides the action of an organisation, spells out its overall goals and provides a sense of direction for all levels of management and decision making.
      • The prime aim or objective will vary depending on the business form and nature of the business. For example, whether they are a charity or a progfitable organisation
    • The external environment and its affects
      • The external environment will affect costs and demand.
      • The external environment includes competition, interest rates, market conditions and incomes
    • Forming a company who controls it?
      • Memorandum of Assocsiations
      • Articles of association
      • Register with Registrar of Companies at Company House
      • Draw up associations
      • Obtain a certificate of Incorporation from the Companies Registrar


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