Business ownerships can set up with different types, for example: Sole traders, Partnerships, Franchises, PLCs and Ltds.

Partnerships

A partnership is when 2--20 people will run and control a business. They will share the responsibility and the profits of the business. The advantages of partnerships are a partnership over a sole trader is shared responsibility. This allows for specialisation, where one partner's strengths can complement another's. It can be less stressful than a being a sole trader because of sharing the decisions and work load. And because this business has more people to run and set up than a sole trader, so it means more ideas and more capital can be put into the business. There is less pressure of time on individual partners. The disadvantages of partnerships are the distribution of profits can cause problems. The deed of partnership sets out who should get what, but if one partner feels another is not doing enough, there can be dissatisfaction. A partnership has unlimited liability. And some partnerships have sleeping partners, if a sleeping partner decides to leave the business, the business might have problems with capital.

Franchises

Franchise is a business using the name, image and products of a larger, successful organisation. The advantages of franchise are you can use a recognised brand name and trade marks. You benefit from any advertising or promotion by the owner of the franchise. Financing the business may be easier. Banks are sometimes more likely to lend money to buy a franchise with a good reputation. Risk is reduced and is shared by the franchisor. To be a franchisor, he/she has a regular income. To be a franchisee, he/she has low risk involved in franchising. The disadvantages of franchise are the franchise agreement usually includes restrictions on how you run the business. You might not be able to make changes to suit your local market. You may find it difficult to sell your franchise, because you can only sell it to someone approved by the franchisor. Part of the profit from the operation goes to the franchisor. And franchises are expensive way of starting a business.

Private&Public Limited

PLCs are large businesses who can sell their shares on the London Stock Exchange to public. The advantages of PLCs are a PLC is able to advertise the sale of shares and sell them to members of the general public though the stock exchange. Shareholders have limited liability. And it has cheaper borrowing and bulk purchasing. The disadvantages of PLCs are going public can be expensive. Risk of takeover by rival companies who have bought shares in the company. Some PLCs can grow so large that they may become difficult to manage effectively. A Ltd is a business that is unable to float its shares on the stock exchange, however it may issue its shares to friends, family and employees. The advantages of an Ltd are that shares can be sold to the general public unlike a private limited company and can help to raise substantial amounts of capital easily and are able to advertise in newspapers and on television whereas private limited companies are unable to do this. Easy and inexpensive to set up. And Small and less bureaucratic than PLCs. The disadvantages of Ltds are there is no benefit from economies of scale and if there is no share issue, they will lack capital.