Ownerships of a Business

• Get money by selling shares.
• Firm is bigger.
• Shares can be sold to a family business.

Disadvantages

• Cannot sell on the stock market.
• Accounts are not private.
• No decisions can be made.

3. Franchise

A Franchise is a business established or operated under an authorization to sell or distribute a company's goods or services in a particular area. The word franchise can split up into two if you look at it as “Franchisors” and Franchisees”. The franchisor earns revenue by giving other business the franchisees; this is the right to your services using its name. The benefits of having a franchise are:

• If you are an owner of a franchise of a business you would retain most of the profit.
• Only a small percentage of these types of ownerships do not work. The owner of the franchise can set out how much money he wants to put into the business.

Disadvantages:

• The franchisee does not n have power to run that ordinary business would have because of the franchise agreement.
• The franchisee cannot sell the business without the franchisor’s permission.

4. Sole Trader

A sole trader is someone who runs and works there own business. As a sole trader you can. Setting up as a sole trader is a good plan if your business is low risk and your overheads are relatively low. This is the simplest form of business organisation. One individual starts trading and has then formed a sole proprietorship. The owner provides all the capital and undertakes all the risks. There are very few legal requirements for this type of business and virtually no requirement to make publicly available any information. The owner retains all the profits and likewise, is personally liable for all debts incurred.

The advantages of setting up a sole trader

• Start trading right away

• The owner does not have to pay off debts
• An example of a sole trader hair dresser is
• Can make all the decisions of the business
• Keep all the profits
• Easy to set up
• Unlimited liability

Disadvantages

• If the business fails, the proprietor would not have an income and all debts would have to be met by the proprietor's personal assets - home or car, for example.

• As a small business, sources of finance may be more difficult to obtain compared to larger businesses. One consequence of this is that expansion can be difficult.

1. Partnership

Partnership businesses are usually small business. They are bigger than sole traders; you will know this if the business has two or more owners. This means that the business is aiming to make large profit. There can be up to 20 partners and the money is usually provided by the partners. You can have something called a deed of partnership which is, legally binding agreement between the partners who are in business together. It describes how the partnership will be run and the rights and duties of the partners themselves. And also has information of how much money a partner has put money into the business, who the partners are, how the profit should be shared out, the producers of a partner joining or leaving the business and also how many votes one person has in meetings. They also have unlimited liability (except sleeping partners), for example a partnership business could be a estate agents or a accountants etc.

Advantages

• Easy to set up.
• Usually small so less money is needed to set up.
• Responsibilities can be shared around partners.
• Decisions can be shared.
• Can be run as a family business.
• Money comes from partners.

Disadvantages

• Unlimited liability.
• Legal costs of making a deed of partnership.
• Arguments within the group.
• Limited amount of partners.
• More money may have to be pt in if a partner leaves.

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