Business Ownership Year 10 GCSE Business Studies Can anyone work out what these two pictures represent?

Can anyone work it out??? SAY WHAT YOU SEE!

Learning Objectives 1)To know what a Sole Trader is. 2)To state three benefits/drawbacks of being a Sole Trader. 3)To understand the process of becoming a Sole Trader.

What is a Sole Trader? A business is owned by ONE person. Employ other people to work for them. Also known as SELF-EMPLOYED. Fact: Approx 3 million people are SELF- EMPLOYED – most are Sole Traders

What sector of industry do you think will you find most of the Sole Traders? Normally in the Tertiary Sector Building services such as plumbing, decorating, roofing, window cleaning etc. Retailing Agriculture

It just so happens today that we have….

Listen carefully… You need to listen out for the following: Why did Joe become a Sole Trader? What are the benefits? What are the drawbacks? Let’s Welcome Joe to the class….

Team Activity How long has Joe been a Sole Trader?

Team Activity Why did Joe set up as a Sole Trader?

Team Activity Where did Joe get the finance from to set up his window cleaning business?

Team Activity When Joe went to get a loan from the bank, what did he have with him that helped persuade the bank manager to lend him the money?

Team Activity Write down TWO advantages that Joe mentioned about being a Sole Trader.

Team Activity Write down what Joe meant by ‘Unlimited Liability’

Team Activity What was the name of Joe’s business?

Stats!!! There are 4.8 million small businesses in the UK (up from 4 million in 2003) - 3 million businesses are sole proprietors million are companies - 462,000 are partnerships - 97 per cent of firms employ less than 20 people - 95 per cent employ less than 5 people - Over 500,000 people start up their own business every year - Small firms employ more than 59.4 per cent of the private sector workforce million people work in small firms - Small firms contribute more than 50.1 per cent of the UK turnover - 64 per cent of commercial innovations come from small firms - 25 per cent of all private sector enterprises operate in Business Services - 21 per cent of all private sector enterprises operate in Wholesale, Retail or Repairs - Over 2 million people run their small business from home - Another 7.5 million people work for their boss from home

Your Turn: What are the ADVANTAGES/ DISADVANTAGES of being a Sole Trader?

Advantages of being a Sole Trader Small business - requires a small amount of capital to start up. Any profit you make – YOU keep! (still have to pay tax) Work the hours you choose – depends on what MOTIVATES you. Financial information about business can be kept private. As the owner you are in COMPLETE control of the business.

Disadvantages of being a Sole Trader The owner has UNLIMITED LIABILITY. Any losses the business makes have to be met by the OWNER. Shortage of capital - restricts a Sole Trader when wanting to expand and develop. Harder to get a bank loan – why? small businesses represent a significant risk to the lender

Disadvantages of being a Sole Trader If the OWNER is sick who runs the business? Often have to work LONG hours in order for the business to be successful. No-one to share making important decisions with. Lack of fresh ideas if working alone. Vulnerable if up against larger and cheaper competition.

Plenary Activity Working with your neighbour List as many Sole Traders from Eastenders as you can LTtM

What have you learnt? Before you leave MY PRESENCE, you must complete your ‘Triangle of Learning’.