Business Ownership in the UK

Private Sector - aims to make a profit and is owned by private individuals from the general public Public Sector - consists of organisations run or financed by central and local government.

Business size is usually measured by the number of employees, sales figures or value of their assets: e.g. 31 - 200 employees 201 + employees 30 employees small medium large

Sole Trader Features: Single owner Unincorporated Unlimited liability Advantages Disadvantages Own boss Unlimited liability Gain all profits Little capital to set up Make all decisions Perhaps long hours, few holidays, etc Easy to set up

Partnership Features: Between 1 & 20 partners Unincorporated Unlimited liability Partnership Advantages Disadvantages More shared capital to start up Unlimited liability Share running of the business Share all profits Easy to set up Arguments can occur

Limited Companies Memorandum of Association Articles of Association Companies House Certificate of Corporation

Two types of limited company: Public Limited Company (PLC) Can sell shares to the general public Private Limited Company (LTD) Can only sell private shares Advantages: Limited liability Separate legal entity to owners Can sell shares publicly Disadvantages: Must disclose annual financial information Must hold an AGM Advantages: Limited liability Separate legal entity to owners Disadvantages: Must disclose annual financial information Must hold an AGM Cannot sell shares publicly

Franchise “an agreement between a franchiser and a franchisee” Franchiser: a large company Franchisee: private individual Advantages Disadvantages Well known product/service Cost of buying the contract can be very expensive Franchiser will advertise and promote product Percentage of the profits are paid to the franchiser Banks will be more willing to lend money for start up Franchise agreement can be withdrawn Business failure is low Owner becomes a “branch manager”

“people join together to organise, make decisions and share profits” Co operatives “people join together to organise, make decisions and share profits” All members have an equal share and an equal say. Profits are shared equally Types of co-operative: Workers Co-operative Retail Co-operatives

i.e. Department for Defence Public Sector Local Government i.e. Local council Public Corporations i.e BBC Central Government i.e. Department for Defence