Business Studies: Types of a Business

Types of a Business

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SOLE TRADER

-Controlled by one person.

A

-Small and easy to set up.

-Only small amount of capital needs to be invested.

-Wage bill is low, as there are no/a small amount of employees.

-Easy to keep overall control.

D

-Only person responsible for business.

-long hours and not many holidays.

-Development and expansion is difficult - only small amount of capital.

Unlimited liability.

Unincorporated.

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PARTNERSHIP

-Owned by 2 or more people.

A

-Shared responsibility.

-More capital.

-Less time pressure.

-There is someone to consult over business decisions.

D

-Arguements and disputes can occur.

-Distribution of profit can cause problems.

Unlimited liability.

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LTD (Public Limited Company)

-Doesn't sell shares onto the stock market.

A

-Easy and inexpensive to set up.

-Ownership and control are closely connected.

Small and less bureaucratic than PLCs, eg decisions can be taken more quickly.

D

-Lack of capital - no shares/investment in business.

-No benifits from economies of scale eg. bulk buying, cheaper borrowing.

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PLC (Private Limited Company)

-Sells shares onto stock market.

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