Number of owners:1
Legal Requirements to Start: Register as self-employed with HMRC
Liability: Unlimited Liability – the debts are the responsibility of the owner.
Decision Making: The owner is responsible for all the business’s decisions.
Distribution
1 of 19
Partnership
Number of Owners: 2 minimum
Legal Requirements to Start: Register with HMRC. A Deed of Partnership is also usually drawn up to state how the business will operate.
Liability: All partners will have Unlimited Liability. They will all be responsible
2 of 19
Limited Liability Partnership
Number of Owners: 2 minimum
Legal Requirements to Start: Register with HMRC and complete an LLP Agreement that outlines how the LLP will be run.
Liability: Partners have Limited Liability. They only stand to lose what they have invested if the busin
3 of 19
What is liability?
Liability means responsibility and refers whether the owners will be responsible for the debt of the business
4 of 19
What is limited liability?
If an owner has limited liability, they will only lose what they have invested into the business. Shareholders in businesses have limited liability as they only pay there investments.
5 of 19
What is unlimited liability?
If an owner has unlimited liability they are fully responsible for all debts for the business
6 of 19
What is a franchise?
A franchise is when someone buys the rights to an existing business name to run as their own business but have to follow ideas of existing business
7 of 19
What are the benefits of owning a franchise?
The owner will benefit from the franchisor as given guidance and help. The business is already a success so more likely to succeed than setting up their own and will also benefit from any advertising by the franchisor.
8 of 19
What are the disadvantages of owning a franchise?
It is expensive to pay for the rights to use the name, more than a self made business. You cannot make changes to the business format and have to pay royalties.
9 of 19
What is capital?
Capital is the name give to money that is used to start-up a new business or launch a new product.
10 of 19
Capital Source:
Own Savings-
Own Savings – This is the owners’ own money. They won’t have to pay interest (unlike a loan) but do risk their own savings if investing.
11 of 19
Capital Source:
Friends and Family
Friends & Family – Borrowing from friends or family may not include interest and doesn’t need paperwork but can lead to friction if not paid back.
12 of 19
Capital Source:
Loans
Loans – Loans from banks or other organisations can help raise capital quickly but will have interest added to the amount paid back.
13 of 19
Capital Source:
Crowdfunding
Crowdfunding – This is where lots of a people pledge small amounts of money, usually online. This can be slow to raise the amount of capital needed.
14 of 19
Capital Source:
Small Business Grant
Small Business Grant – Sometimes Governments give grants to encourage businesses to set up. Some grants do not require pay back or may be interest free.
15 of 19
Capital Source:
Business Angels
Business Angels – Investors on the TV show ‘Dragons Den’ would be considered Business Angels. They invest in a business idea in exchange for pay back or part ownership of the business.
16 of 19
What is a business plan?
A business plan is a document that is drawn up before a business is launched to describe the business idea.
17 of 19
What should a business plan contain?
-Business aims and objectives
-Business strategies
-Business operations
-Sales plan
-Marketing plan
-Financial forecast
18 of 19
Why is it important for a start-up business to have a business plan?
-It should reduce the risk of failure, especially if detailed and realistic as all events will be planned for giving more reassurance to places like the bank.
19 of 19
Other cards in this set
Card 2
Front
Number of Owners: 2 minimum
Legal Requirements to Start: Register with HMRC. A Deed of Partnership is also usually drawn up to state how the business will operate.
Liability: All partners will have Unlimited Liability. They will all be responsible
Back
Partnership
Card 3
Front
Number of Owners: 2 minimum
Legal Requirements to Start: Register with HMRC and complete an LLP Agreement that outlines how the LLP will be run.
Liability: Partners have Limited Liability. They only stand to lose what they have invested if the busin
Back
Card 4
Front
Liability means responsibility and refers whether the owners will be responsible for the debt of the business
Back
Card 5
Front
If an owner has limited liability, they will only lose what they have invested into the business. Shareholders in businesses have limited liability as they only pay there investments.
Comments
No comments have yet been made