Forms of Business organisation AS1: Business Studies (Forms of Business Organisation) Forms of Business organisation

Private Sector Organisations Sole traders Partnership Franchise Private Limited Companies Public Limited Companies

Sole Traders Limited sources of finances Get to know employees on a personal basis Owns and operate his/her business Only one who benefits from success Has total control Close contact with customers Long hours of work Unlimited liability for debts Accounts are not published

Partnerships More capital Better potential for growth Less control Variety of skills available Unlimited liability Financial affairs do not have to be published

Franchise Franchiser gets annual royalties Reduced risks and capital investment Increased opportunities for expansion Individuality of businesses are lost Loss of independence Reputation is in hands of others

Private Limited Company Process of forming the business is more complicated Limited amount of share capital Shares held by a small group of people Shares cannot be bought by the public Company cannot be listed on stock market Profit is according to the number of shares held

Public Limited Company Regarded as a lower risk investment Must keep a wide range of people informed Easier to raise finance Should get more attractive credit facilities More emphasise placed on short term financial performance Control is limited due to open share sales Can be listed on the Stock Exchange