Types of Business Ownership, Aims and Objectives.

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Franchise – This type of business is when an individual wants to have a well-recognised name as their business name so they have to pay the franchiser royalties for them to allow them to use the name. In-exchange the franchiser provides: promotion, premises, equipment and usually you are able to buy all the stock from the franchiser. The advantage to the franchiser is that they are able to expand and make their brand awareness more than it is and the advantage to the franchisee the advantage is that they are able to have well-known brand name which customers recognise and trust, the franchisee receives all the benefits of being a big co-operation and not have to wait that long.

Public Sector (PLC) – These are the big co-operation that people are allowed to buy shares into the company. A company in the Public Sector is usually a well-known company and it operates to generate a profit. The advantage to this type of company is that the public are allowed to but shares into these companies on the stock exchange, when a company starts selling shares it gets an instant investment and is able to expand and make their company even bigger disadvantage is that the company itself cannot make dictions without consulting the shareholder. The company loses a sense of ownership when they start sell shares.

Charitable Trust – is non-profit organisation sometimes ruin by the government and operate for the benefit of the public and to provide a service for them only and not make a profit. An advantage of this type of business is that the company is operating for the good of the public and are providing a service which might cost money. A disadvantage of this type of business is that the company do not generate a profit and if it is not owned by the government it has to find its own funds to operate.

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Types of Ownership

Sole Trader - A Sole Trader is someone who owns the whole business and is responsible for everything in the business. An advantage to this type of business is that there is only one owner so they get to keep all the profits. A disadvantage is that a sole trader tends to have unlimited liability meaning that if their business was to go bankrupt their personal assets would act as security for the loans they had taken out so they would get taken.

Partnership – A partnership is when there are 2-20 people owning a ...

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