Partnerships can have between 2 and 20 partners.
They have to operate according to the partnership agreement which includes;
- The amount of capital made by each partner
- The procedure needed to be taken incase of disputes
- How the profits will be shared
Advantages:
- More partners, bring more capital to the business.
- New skills and expertise are added to the business.
- If one partner is ill, the others can cover them to save the business from becomming vunerable.
Disadvantages:
They have to share all of the profits.
Partnerships still have unlimited liablity - responsible for all debts.
- Each partner is responsible for the decisions made by other partners even if they had no say in the decisions made.
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