6.0 Business Ownership

• What are the advantages of being a sole trader?

  Easy decision making

  Be your own boss

  Easy to set up

  Can operate the business to suit their lifestyle

  Any profit is kept by the sole trader
• What are the disadvantages of being a sole trader?

  Difficult to raise capital

  Lack of necessary skills

  Fewer ideas

  Very long hours

  Unlimited liability
• What are the advantages of a partnership?

  Cheap and easy to set up

  Extra capital available

  Shared workload

  Each partner will bring their own skills and ideas to the business
• What are the disadvantages of a partnership?

  Shared profit

  Potential disagreements

  Partners have to work as a team

  Unlimited liability

  If a partner dies oŕ becomes bankrupt, a new deed must be created
• What are the advantages of an Ltd

  Limited liability

  Capital is easy to raise

  Relatively cheap to set up

  Can't be taken over by shareholders without agreements
• What are the disadvantages of an Ltd?

  More expensive that sole traders and partnerships

  Has to publish accounts every year

  Difficult to find suitable shareholders
• What are the advantages of Plcs?

  Limited liability

  Easy to raise capital

  Benefit from the economies of scale
• What are the disadvantages of plcs?

  Expensive to set up

  Has to publish accounts

  Unwanted takeovers are possible
• What are co-operatives?

  Businesses owned by members with a common aim to benefit the community
• What are the advantages of co-operatives?

  Members feel they have an impact in the business

  Less focus on profit so better customer service

  Profits are fairly distributed
• What are the disadvantages of co-operatives?

  Difficult decision making

  Difficult to make decisions which affect other members

  Difficult to find good managers as they usually demand a high wage