Business Ownership
Advantages of franchise
-Assistance from parent company. -Name recognition. -Shared advertising expenses. (McDonalds)
Business ownership includes:
-Determining which type of business fits the needs. -Securing finance. -Name the company. -Protecting business ideas. -Location. -Licenses and permits.
Disadvantages of corporation
-Difficult to build. -Can be complex, especially accounting. -Has more analyzed governmental regulations. -Can increase profits on corporate profits and shareholders. -Requires more time and money.
Disadvantages of partnership
-Disagreements between partners. -Actions of one legally bound to other. -If one dies, the partnership dissolves and a new one must be made which takes time and money. -Must contend the fact they are working under unlimited liability.
Advantages of partnership
-Easy start up. -Combines skills of two or more people. -Each partner has a voice. -More money available for operation or expansion. -Taxed and monitored less than a corporation.
Advantages of corporation
-Easy to raise wealth and assets. -Easier for people to leave and enter. -Limited liability for each owner. -Each department can easily be managed by a pro in the area.
Disadvantages of sole proprietorship
-Harder to raise money to expand the business since the company's shares are not sold. -Unlimited liability: complete business responsibility in business debts and losses- can lose portion of personal assets. -High start up cost. -Owner can have limited skills.
Disadvantages of franchise
-High purchase fee. -Percentage of sales or yearly fee paid to parent company. -Must follow parent company business structure.
Partnership
-Legal agreement between 2 or more people responsible for a business. -Least common form.
Corporation
-Most complicated form. -A separate legal entity. -Forms boards to act as governing bodies. (Directors and officers) -Ownerships can be shares of stocks. -Is subject to many governmental regulations.
Sole proprietorship
-Owned and operated by one individual. -Most common form.
Sole proprietorship requirements
-Provide funds, resources, and management responsibility to start and run a business.
Advantages of sole proprietorship
-Relatively simple with less taxes and government regulations. -Owner entitled to all profits. -Relatively easy to start. -Easy to maintain business confidentiality.
Types of business ownership
-Sole proprietorship. -Partnership. -Corporation. -Franchise.
Ways to become a business owner
-Start a new business. -Purchase a franchise. -Purchasing an existing business (non-franchise). -Taking over family business.
Franchise
-The right or license to see a company's product or service at a designated location. -Includes franchiser and franchise.
2 forms of partnership
General partnership and limited partnership.
Limited partnership
Have unequal share and liability in business; responsible only for money they invested.
General partnership
Share equal liability in business profits and losses.
Business ownership
The individual or groups which own a business and it's legal entities.