1.5.4 - Forms of Business

Question 1

Sole Trader

Answer 1

A sole trader describes any business that is owned and controller by one person – although they may employ workers. Individuals who provide a specialist service.

Question 2

Franchise

Answer 2

The legal right to use the name and logo of an existing firm and sell the same products, e.g. KFC

Question 3

Franchisee

Answer 3

Someone who buys the right from a franchisor to copy a business format.

Question 4

Franchisor

Answer 4

The person who grants a licence (the “franchise”) to another business (the “franchisee”) to allow it to trade using the brand or business format.

Question 5

Partnership

Answer 5

A business that is set up and run by 2-20 partners. Usually set up with a Deed of Partnership (DOP)

Question 6

Dividend

Answer 6

A Dividend is a payment from the profits of a company to

shareholders.

Question 7

Private Limited Company

Answer 7

A business that sells shares to friends and family and has limited liability

Question 8

Public Limited Company

Answer 8

A company, with limited liability, whose securities are traded on a stock exchange and can be bought and sold by anyone

Question 9

Social Enterprise

Answer 9

Social enterprise is a business that trades to tackle social problems, improve communities, peoples life challenges and the environment.