business ownership

• Sole trader-business owned and managed by one person 

  Advantages of this is that they can decide things quickly, keep all profits and make their own decisions 

  Disadvantages of this is that they may not have all the skills required, heavy workload and it will be difficult to take a holiday 
• Partnership is when two or more people join in a business to make profit 

  Advantages of this is that they can share workload, help each other out and there are more sources of finance 

  Disadvantages of this is that they will have to share profits, unlimited liability, may disagree with other partners 
• Public limited company (PLC) is a business that is owned by its shareholders. Anyone can have a share in the business and its shareholders have limited liability 

  Private limited company (Ltd) is a business that is also owned by its shareholders, but the shares are not available to the public. Shareholders have limited liability. 
• Shareholders own a share in the business and receive a share of the profits each year called a dividend 

  Private limited company (Ltd) is a business that is also owned by its shareholders, but the shares are not available to the public. Shareholders have limited liability. 

  Advantages of a limited company is that it is a good marketing move- people tend to think that companies are better than a sole trader and protected business name
• Disadvantages of this is that there are a lot of legal procedures accounts must be checked regularly, sales and profits need to be shared 
• Not for profit organisation are businesses that do not make profit, for example charities 

  Advantages of this is that it provides a service, for example schools, police and fire stations and it helps people 

  Disadvantages of this is that there is no regular income which does not make it investable, does not make profit and is not consistent 
• Deed of partnership is an agreement between partners that sets the rules if a partnership. For example, how profits will be divided and how decisions will be made. This is a legal document