The Business environment – Assignment Example
Business ownership Analysis This review aims at giving the various options of business ownership in the private, public and voluntary sector, broadly analyzing their characteristics and further doing a comparison between two organizations. The public sector forms of business are carried on for the purpose of creating wealth in a nation and also providing employment to its nationalities. It also aims at providing goods and services to the public at large e.g. the meat commission. Any government in a country is responsible for the running of the public sector enterprises. The private sector on the other hand, carries out business for the purpose of gaining profits. They are managed privately by different individuals. In the process, they help in growing the economy of any nation by providing employment and services to the country. The voluntary sector entails different charities and voluntary bodies offering support in communities with an aim of reaching an intended goal e.g. helping the needy, the cancer ailing people etc. this sector is not carried for making profits but to give support when need be.
The sole trader is a form of business owned by one person only. It is usually an enterprise carried on for the purpose of making profits. The owner has unlimited liabilities. In case the company goes into debts, the individual will be held liable to clear the debts with his own property. The business is not a legal entity. The partnership business is carried on by two or more individuals up to a limit of twenty. The main purpose is earning profits. It is not a separate legal entity as in the case of the sole trader: hence any debts incurred are deducted directly from the partners should the business fail to honor them (Jan, 192).
Public limited companies are formed as separate entities from its owners. They have a limitation on the number of people required to form the different companies i.e. a minimum of seven. 25% of the allotted shares of the company must be fully paid before commencement. Shares are freely transferred in these companies. On liability of debts to the company, the creditors can only sue the company directly i.e. in our case the government to claim its money. The private limited company is more the same as the public companies. They are formed as separate legal entities from its owners hence the owners are not liable for the company’s debts. The minimum number required is two up to a maximum of fifty. Shares are not freely transferred to the public (Jan, 193).
Cooperatives are formed by a group of people with the intentions of offering services to its members. A board of directors is elected to oversee the running of the cooperative. It is a legal entity separate from its members hence on liability to debts, the cooperative is accountable for fully. An annual report is usually prepared for its member’s review of the cooperative’s undertakings.
The franchise entity is where a person or a group of people are given the right to use the trademark of another person- the franchiser to market a service or a product. Technically speaking, this is not a business but an agreement between the two parties. Any liability of debts is wholly borne by the franchisee unless the agreement states otherwise.
Comparison and contrast:
NAME OF BUSINESS
J Sainsbury Plc:
Non-governmental organization – voluntary sector
Private limited company
To eradicate poverty and fight injustice
To earn profits and be a leader in its sector. To provide products in supermarkets, chain stores, convenience stores
Donors all over the world
SCALE OF ORGANISATION
Jan Norman, What no one ever tells you about starting your own business: 2nd Ed. Kaplan Publishing, New York City, New York, 2004, pg.192-193.