1 owner that in the eyes of the law is the same as the business
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Do sole traders have limited or unlimited liability?
Unlimited
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What are the advantages of sole traders?
Easy to set up, few legal formalities, complete control, you get all the profits, can respond to changes in the market
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What are the disadvantages of sole traders?
Unlimited liability, long hours, high pressure, limited finances, limited skills
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What is a partnership?
A company slit between 2-20 partners bu their % of ownership stated in deed of partnership
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What are advantages of a partnership?
Wide range of skills and knowledge, get a say in decidions, get some reutrn of profits
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Do partnerships have limited or unlimited liability?
Unlimited
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What are the disadvantages of partnerships?
Profits are shared, control is shared, potential for arguments, parnets have unlimited liability
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Define incorportated
When a business has their own legal identity and can sure or own assets in their own right
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Are limited businesses incorporated or unincorporated?
Incorporated
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What are private limited companies?
Often smaller shops - Shareholders are often family and friends and all shareholders must be in agreement for the sales of the shares. Shareholders receive dividends
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What are advantages of private LTD?
Limited liability, access to more finance, more private that Public, more flexible that public
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What are disadvantages of private limited companies?
All shareholders have to agree on sales and can't be sold on stock exchange, less flexible, more legal formalities
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Do shareholders have limited or unlimited liability?
Limited
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What are public limited companies?
Usually a well known business - shares are sold on the stock exchange
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What are advantages of Public limited companies?
Limited liability, easier to raise finance, greater scope for investment, greater publicity
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What are disadvantages of public limited companies?
Must publish financial and business details, Founders may lose control to shareholders
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What are franchises
Buying into an existing business and acqiure the right to use and existing business idea
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Define Franchisor
Who sells the right to use a business idea in a particular location
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Define Franchisee
Who buys the right from a franchsior to copy a business format
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Define Stakeholders
Anyone who is affected by a business
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Give examples of stakeholders
Customers, suppliers, employees
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Are all stakeholders shareholders?
No - All shareholders are stakeholders but not all stakeholders are shareholders
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Other cards in this set
Card 2
Front
Do sole traders have limited or unlimited liability?
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