School resources

• Sole trade business


  Has just one owner
• Advantages of being a Franchise over carving a Diner though the owner may employ other people to work for them
• Sole trader


  • Responsible for all the debts of the business
  • Unlimited liability
• Partnership


  • Two or more people trading together as an organisation
  • Unlimited liability
• Private Limited Company


  • Limited liability - responsibility for the debts of the business is limited to the amount invested
  • More expensive to set up
  • More legal paperwork
• Disadvantage of Franchising is that the franchisee usually has to pay a fee payable to the Franchisor, so they may end up with less money than if they started the business from scratch
• Business location


  Affected by access to raw materials, proximity to customers, and ability to find skilled workers
• The internet


  Makes business location more flexible, as e-commerce means manufacturers can locate further from their market but closer to their raw materials
• Sole traders may have to work long hours and not get many holidays
• Sole trader


  • Doesn't have its own legal identity
  • Can be hard to raise money
• Partnership


  • Legally responsible for all the other partners
  • Unlimited liability
  • More disagreements as not the only boss
  • Profits shared between partners
• Franchising


  When one business, the Franchisor, gives permission to an entrepreneur to use their business as their own
• High employment area


  Increases business revenue as people have more disposable income
• Higher competition


  Requires businesses to invest more money on promotion, increasing costs
• Low competition


  Requires less promotion, so profit is higher and costs are lower
• Businesses may focus promotion on the overall image of the company to establish an image with customers
• Businesses may locate near competitors to take advantage of skilled local suppliers and because customers know where to find them
• Businesses in high unemployment areas can keep wages low and find enough workers
• High-street retailers


  Locate in popular areas to attract more customers
• Manufacturing firms


  Locate further from town centres to access cheaper premises and logistics/transport
• Place


  A way in which a firm sells its product through retailers to its customers
• Promotion makes people aware of a product, increasing customer numbers and revenue
• 1. E-commerce

  Affects the marketing mix because the entrepreneur doesn't have one set location meaning the cost is low and the profit is
• Small businesses may not sell through large retailers as they are unlikely to produce products in large enough quantities
• Business plans help a business know if an idea is good before money is wasted, reducing the risk of failure
• Business plans should include details of the product, market research, cash flow forecasts, and financial ratios