1. 1.5.4 Choosing the right legal structure

2. Candidates should be able to:
Syllabus
Candidates should be able to:
define sole trader, partnership, private limited company, public limited company
define franchising, social enterprise, lifestyle businesses, and on-line businesses
analyse the advantages and disadvantages of various legal structures
assess the impact of growth to plc and stock market flotation

3. Private or public organisation
All organisations in the UK are either part of the public sector or the private sector.
If a business is owned by private individuals, it is part of the ______ sector
If the business is owned by the state (government), it’s part of the ____ sector
What sector contains charities?

4. Legal structures in the private sector
There are four forms of legal structure in the private sector you need to know about. Do you know what they are called?

5. Research legal structures in the private sector
Research the features, advantages and disadvantages of the following and create a table:
Sole trader
Partnership
Private limited company
Public limited company

6. Partnership – Deed of partnership
Contains information on:
How much money each partner has contributed
Who makes decisions
How the profits are shared
How the partnership can be ended

7. How do you choose a legal structure?
Watch the video and take notes

8. Social (not-for-profit) enterprise - features
Main aim is charitable rather than profit
Social enterprise organisation
E.g.
What happens to any profit made?

9. Social enterprise - benefits

10. Social enterprise - drawbacks

11. Other forms of business ownership in the private sector
Franchises – a business which has bought the right to trade under an established name.
The franchisor is a company who owns the franchise. The franchisee buys the right to trade.
Co-operatives – groups of people who enter business and share the profits

12. Franchisee – benefits and drawbacks

13. Franchisor – benefits and drawbacks

14. They may be less interested in _____ profits and more interested in
Lifestyle business
This just means a business which fits in with an entrepreneur’s lifestyle e.g. a keen walker might run a business leading guided treks.
They may be less interested in _____ profits and more interested in

15. What is the main difference?
Online business
What is the main difference?
E.g. Uber was valued at $18 billion in less than 5 years after it launched!