Sole Trader Sole traders portray any business that is owned and managed by a single person, although sole traders employ employees. The owner is normally the person that is liable for the businesses decisions - The firms are generally small and in most circumstances is easy to setup. - Sole Traders normally only require a small amount of capital to be invested and this reduces the initial start-up cost. - Monthly wages are often low as there is only a few or no employees. - This type of business is easier to control as the owner would have a hands-on approach to running and making decisions for the sole trader. Partnership Partnerships is a type of business entity where owners spread profits, losses and costs of the …show more content…
Franchising is normally used by companies that are providing services. It’s easier to begin franchising than settings up separate traders/stores, after companies begin to franchise it becomes easier to build a bigger customer base. Although, Franchising does not come at a cheap price, The franchisee has to pay a large amount of initial fees and commissions to the franchise. Closing a franchise is harder than opening one. There many reasons why businesses owners may want to close down a franchise, the most common reason is financial issues & Bankruptcy, however, it’s not an easy task to close down a franchise and in some cases it’s not possible to close them down. Private Limited Companies (PLC) Private Limited Companies are normally owned or founded by family & friends and usually based within a household. PLCs can have stock and shareholders, although, their shares are not traded on public exchanges. Turning a family ran business into a PLC is good for several reasons. The main reason is the fact that there is limited liability, this means that if the business encounters any financial issues due to normal business activity, the personal assets owned by the owners or employees would not be at risk of being take to cover debts. PLCs do also have their limitations however, they are only allowed a maximum of 50 shareholders and their shares are unable to be sold or transferred to anyone else without agreements of other
| A general partnership is comprised of a group of two or more individuals who enter into an agreement to start a business. The partners and the business are legally the same. The partners enter into an agreement called the articles of partnership and are typically equally active in the business and the business’s management, unless otherwise stated in the partnership agreement. All profits and losses are shared by the partners in a joint business venture.
Sole trader is where a business is run as an individual; so that all profits are their own after tax has been paid on them. Within a sole trader organisation it is possible to employ staff, as the sole trader only means that you own the business personally and do not actually have to work by yourself.
A public limited company can cause many advantages and disadvantages for a business. An advantage of being a PLC is that it will give the company more of a prestigious profile. This could be easier to gain access to better suppliers or opportunities for the business. Another advantage of being a public limited company is Liquidity this means shareholders can buy and sell their shares.
Limited Partnership which has adopted laws based on the Revised Uniform Limited Partnership Act (RULPA), would be a better option for you if
General Partnership: Occurs when two or more individuals get together to operate a business with the intention of making profit. Each individual is a general partner of the business and all profits and losses are shared between the partners. General partnership agreements can be a written or verbal agreement.
A business operating as a sole trader in the multimedia industry is privately owned by 1 owner. The owner can operate the
The most popular style of small business enterprise, it’s simple to set up and does not require any formalities. Sole trader often is a one person who manages and owns the company. They take all the profits, but must also include all losses. Indeed, if the only operator becomes insolvent personal assets may be used to satisfy creditors, such as a house, car, etc. They are personally responsible for all indebtedness of the company and have unlimited liability.
Another advantage of a franchise is that you use a recognized business name and reputation also the franchise benefit from advertising or promoting. The franchise has to share all the profit with the franchisor while Tesco which is a public limited company have to share their profit between a great numbers of people. Shares can be advertised and sold through the stock exchange. Another advantage of a public limited company it has more chance to become successful because they have thousand people who working for it, with many skills, idea and experiences. Franchisee is different from a public limited company has it is dependent on the franchisor skills. If the franchisor goes out of business or gets a bad reputation, this will cause problems in the business.
Having a sole proprietorship has many advantages and disadvantages for PODS. Some advantages to having a sole proprietorship would be the ease and cost of formation, having more flexibility and control, able to make quick decisions, minimal legal costs, closing business distribution and use of profits (Ferrell, Hirt, and Ferrell,2014) This is a wonderful option for someone who is just starting out and wants an easier way conduct business. Sole proprietorship also can have some disadvantages such as only having access to limited funds, lack of continuity due to investors not wanting to invest their money into something that has little or no history (Ferrell, et al., 2014). Most new business owners are not able to hire employees which have the qualified skills needed to get the company up and going successfully.
Sole trader-it’s a business that is owned by only one person and it can have one or more employees. This type of business organization often succeeds because the owner has total control of businees, the owner keeps all profit and it’s cheap to start-up,but also it can be difficult to raise financial,it may be difficult to specialise or enjoy economies of scale and can also have problems with continuity if sole trader retires or dies.
A partnership is a business organization where the partners own the business together and are
Is the most common business type, where the business is operated and owned by a single individual. In this type of business, the sole proprietor provides capital, does not share profit or loss and runs the business alone. As such, the business and the owner are indistinguishable for tax and legal purposes (Dlabay, 2011). To differentiate this business from other business types, a sole proprietorship is discussed under the following characteristics.
It has its advantages and disadvantages to franchise the business. It is a careful decision to make for anyone to invest a lot of money into a franchise and everyone should be comparing pros and cons.
The biggest advantage of doing business under a sole proprietorship is that it is extremely easy to form since the individual creating the sole proprietorship is the business. They are fully responsible for all aspects of the business including making good on
Sole traders have unlimited liabilities,meaning that in terms of law there is no separation between them,hence the sole trader is also liable for the debts incurred within the business, which makes it very risky to run for a long-term.