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Types of Ownership

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Introduction

NAME: Lashana Ricketts FORM: 10LE TEACHER: Mrs. Barton TYPES OF OWNERSHIP NUMBER: 1 The 6 main business ownerships are: SOLE TRADER: A sole trader business has 1 owner only usually a small shop e.g. Green Grocers, Local newsagent, Nail shops. The owner usually trade only with their family name. They are responsible for all the decisions and problem solving. They would raise the finance themselves or get a bank loan. Also owned financed and controlled by one individual but can employ other staff. A sole trader business is easy to set up. Being a sole trader make you have the only decision that are to be made. PARTNERSHIP: It has between 2-20 owners. Usually businesses like; local shops, solicitors, dentists, builders etc. The partners have responsibility for raising finance. They would share the decision-making process and the profit between them under ''The Deed of Partnership Act (1890)''. (The Legal Contract), Partnerships have unlimited liability. PRIVATE LIMITED COMPANIES: They are generally smaller than a public limited company. Common examples are family businesses such as garages, builders, shops, and local coach companies. The shares are not available for sales to the public and are normally owned by people who run the company. ...read more.

Middle

Memorandum of Association- means the nature, purpose and structure of the company. This generally means that the Gucci Company had to have a Memorandum of Association- this is a reason being before the company can trade. The Gucci Company also have a Certificate of Incorporation; this means that they are allowed to trade. The Body Shop- The Body Shop is a Public Limited Company, which means that the company's shares are available to the public. The directors generally run a public limited company. An advantage of being a Public limited Company is that it helps the company to expand and diversify. A disadvantage of this is that each particular shareholder has very little say in how the company is run, unless they have an awful lot of shares. The Body Shop has a Certificate of Incorporation. This means that The Body Shop is allowed to trade, and to be allowed to trade the company had to have a Memorandum of Association, which means that the company have to have a purpose and structure for being. Shareholders own The Body Shop, but directors run the company. ...read more.

Conclusion

These shares enable you to own a part of that business. LIABILITY AND UNLIABILITY NUMBER: 5 Limited Liability: The Company is blamed for its debt not the owners. Unlimited Liability: The owner/ owners are liable (they have to pay for the debts). GUCCI & The Body Shop: Both Gucci and The Body Shop have limited liability, because the business has a separate legal entity from its shareholders. So the business is responsible for all its debts. I think that every business should have limited liability because those businesses with unlimited liabilities when they go in debt the owners will have to pay for those debts. I think that it is unfair, because why should the owner be blamed for the failure of the business. I know that it is a part of taking responsibility for the business but the people who have to pay so many debts are going bankrupt. I think that every business should be able to get limited liability no matter the problem. I believe that it is only fair and it will cause less problems with some business owners who's businesses are failing. > BOOK: CGP GCSE Business Studies revision guide-->Second Edition for 2005-2007 exams-->EXAM BOARDS--> AQA, Edexcel, OCR-->SECTION--> Business Ownership Structure -->Page 4 (26/09/03) > NET--> http://www.fastlinksolutions.co.uk/startina.htm (26/09/03) ...read more.

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