Advantages/disadvantages of different business structures
- Created by: Hollie
- Created on: 15-05-13 11:36
View mindmap
- Business Structures
- Franchise
- large business's cooperate with sole proprietors which takes some of the risk away than setting up a new business
- franchisor looses some control which could reflect the company in a bad way
- franchisee must pay royalties for use of product and property
- Sole trader
- unlimited liability
- no formal rules/administrative costs for establishing the business.
- limited sources of finance, long hours, limited holiday and trouble during periods of ill health.
- Partnership
- unlimited liability
- Skills are shared
- more capital as more people are contributing financially
- shared strain, holidays and ill health can be managed
- sharing profit can often cause arguments
- loss of control, decision making must be shared
- Public limited company
- start up share capital of £50,000
- Shares floated on stock market which improves the business's access to capital
- limited liability
- converting to PLC can be time consuming and difficult
- Private limited company (LTD)
- Start of capital of around £100
- Shares are not listed on start market but are available to friends and family
- Support of friends and family
- Legally must state 'LTD' after name which warns people they are relativly small.
- Limited liability
- Co-op
- sometimes worker owned or customer owned. A lot of benefits to workers
- Not for profit
- Charitable organizations or businesses that provide a service.Those that fund the charity are not liable for debts
- provides significant tax benefits
- Franchise
Similar Business resources:
Teacher recommended
Comments
No comments have yet been made