Booklet 2 - Ownership Flashcards
Ownership: Sole trader, Partnership, LTD, PLC, social enterprise, co-operatives, SMART targets, aims and objectives
What is a sole-trader?
A sole tracer is a small business owned by one person, for example a kiosk, ice cream van or newsagents
They have unlimited liability, no public accounts
Advantages and disadvantages of sole trader.
Advantages - increased control, choice of hours, revenue (income) - all profits to you, become your own boss.
Disadvantages - unlimited liability, responsibility, large amount of hours, limited knowledge/ expertise.
What is a partnership?
A partnership is a medium sized business between 2-20 people whom all sign a deed of partnership (roles, exits, agreements and profits)
Shared unlimited liability
For example, barbers, hairdressers, restaurants
Advantages and Disadvantages of patnership
Advantages - more ideas, more support and knowledge, more investment and capital, deed of partnership
Disadvantages - increased conflicts, shared profits, shared unlimited liability, slow communication and decision making.
What is an LTD (private limited company)
Medium sized company, with shares from friends and family only, limited liability.
Requires a £20.00 investment to become corporated. Accounts must be publics (once a year). For example: builders, estate agents, accountants
Advantages and disadvantages of LTD’s
Advantages - limited liability so low risk, growth, competitiveness.
Disadvantages - open to takeover, accounts made public, low investment, disputes.
What is a PLC (Public limited company)
large company, sell shares on the stock exchange - limited liability.
public accounts: AGM - discuss performance, multinational business.
requires £40,000 investment
Advantages and disadvantages of a PLC
Advantages - sell shares to public, high capital, easier to expand, limited liability, economies of scale
Disadvantages - accounts are public, takeover, hold an AGM, £40,000 investment
social enterprise and co-operatives
social enterprise - a not for profit business set up to help the community
co-operatives - organisation owned by either the workers or the customers, everyone has an equal vote (delegation)
What are SMART targets?
What are AIMS and OBJECTIVES
Specific - to the business aims and objectives
Measurable - number value can be measured
Agreed - all staff involved
Realistic - target is possible
Timed - target met in a specific amount of time
AIMS: long term objective of a business
OBJECTIVES: targets a business sets itself, perhaps for a business as a whole or for each department.
