What is the private sector
All businesses and organisations owned and run by private individuals and often run for profit
What is Public Sector
All businesses and organisations owned and run by the government
nhs, not for profit
Limited liability
A business is a seperate legal entity to its owner
Unlimited liability
A business isn’t a seperate legal entity to it’s owner
What are the two types of businesses that come under Unlimited
sole trader, partnership
what is a partnership
consists of 2 or more owners
What is a sole trader
someone who owns and runs a business alone
What are the benefits of a sole trader
- Don’t have to share profits
- Easy to set up
- Quick decision making
What are the drawbacks of being a sole trader
- At risk of loosing personal assets to clear business debts
- Lack of expertise
- Sources of Finance
What are the benefits of being in a partnership agreement
- Burden is shared between partners
- Sources of Finance- easy to get loans and money from partners
- Expertise
What stops disagreements in partnerships
Deed of partnership
What are the drawbacks of being in a partnership
- Have to split the profits
- risk factor
Limited business life- death or bankrupcy of a partner
What is the deed of partnership
sets how decisions will be made in a partnership
-profit
-admittance
-disagreements
what comes under unincorporated
sole trader, partnership
What comes under incorporated
LTD’s PLC’s
what is a private limited company
A small to medium sized business made up of individuals known to eachother
What makes a LTD (private) (2)
- shares cannot be sold or advertised for sale on the stock exchange
- Shares must be sold with the agreement of other shareholders
What makes a PLC (Public)
Shares can be advertised and sold by members of the public on stock exchange
What are the requirements of a PLC
- Two directors
- Qualified company secretory
- Over 50,000 capital shares
Benefits of a LTD
- Owners are often managers
- Less risk of hostile takeovers
- less costly to establish than a plc
- Lower minimum share capital requirements
- Less strict regulatory requirements
Drawbacks of a LTD
- more difficult to set up than any other legal structure
- Less sources of finance- shares cant be sold publically
Benefits of a PLC
- large scale investment-stock exchange
- Prestigiousness- attracts better quality staff, more productivity
Drawbacks of a PLC
- Supseptible to hostile takeovers
- Managers are not usually owners- managers pursue their own objectives, disregarding the long term effects
- Strict regulatory requirements
Tesco, barclays, Amazon
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business32
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Private sector23
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sources of finance21
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sectors14
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business, economic objectives, competition48
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entrepreneurship,market, competitive edge8
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markets and economies52
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franchises, conflict, tax18
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opportunity costs and benchmarking20
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corporate governance25
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business structures22
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legal and financial governance10
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TAX21
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Tax (2)21
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imports/exports, exchange rates, inflation, interest rates29
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policies,interest19
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Pensions/ tax16
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Globilisation24
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Stakeholders/ Drivers of change12
