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1.2 Types of Business Organization
Descripción
Business and Management IB Program 1.2 Types of Business Organizations
Sin etiquetas
business and management
empresa
1.2 b. organization
empresa
portafolio
Mapa Mental por
Sandra Vazquez
, actualizado hace más de 1 año
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Creado por
Sandra Vazquez
hace alrededor de 9 años
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Resumen del Recurso
1.2 Types of Business Organization
Body that is set up to meet needs
Try to achieve objectives
Use resources
Need to be directed
Have to be accountable
Have to meet legal requirements
Have a formal structure
Private Sector B. Organization
Unincorporated B.
Sole Trader
One owner
More common
No legal formalities
Legal responsibilities
Need special permissions
Advantages
No legal restrictions
Money for owner
Complete control
Choose hours of work
Disadvantages
Unlimited liability (accountable)
Continuos problems
Difficulty to raise money
Illness can stop work
Can be sued
Difficult to have specialists
No economies of scale
Partnership
More than one owner
Share responsibilities and profit
Second most common
No legal formaliies
Advantages
No legal formalities
No publish of accounts
More finance
Work is shared
Partners can specialize
Disadvantages
Unlimited liability
Size is limited to # of partners
Decisions afect all
Profits are shared
Disagreements
Can be sued
Incorporated B.
Companies
Private Limited Company
Small B.
Shares transfered privately
Family owned
Advantages
Limited liability
No limit of shareholders
Tax advantages to owners
More organized
Disadvantages
Profits are shared
Legal procedure to set up B.
Shares cant be sold to the public
Finance information viewed by everyone
Shares not easy to be sold
Public Limited Company
Large B.
Publish a Prospectus (information of B.)
Expensive, legal formalities
Advantages
Sale of shares = many money
Production cost can be lowerd
Can dominate the market (size)
Institutions lend money
Public pressure = well performace of executives
Disadvantages
Setting cost = expensive
Outsiders can take control
Companies accounts are public
Less able to deal with customers
Operations are controlled
Inflexible due to sieze
Legal separate identity from owners:
Own assets, Form contracts, Employ people
Can sue and can be sued
Limited liability
Capital divided in shares
Run by directors
Pay corporation tax
Exiting Stock Market
From public limited to private limited
Causes
No toleration of external shareholders interferance
Bought by private individual
Lose favor in stocck market
Not-for-profit Organization
Organization that runs a business but doesn't look for profit
Surpluses (extra) from traiding is shered
Factors that affect choices
Degree of control
Need of finance
Nature of B.
Size
Co-Operatives
Operate as consumer or retail co-operatives:
Controlled by owners
Shares not sold in stock market
Surpluses are divided
Other form is worker co-operative
Charities
Specialized aims
Raise money for good
Rely on donations
Run by business principles
Staff are volunteers
Don't pay taxes
Pressure Groups
Groups of people that influence decision makers in politics, business and society
Different aims, objectives and size
Public Sector B. Organization
Government (Publicly Owned)
Public corporations set up by law to run services or indutries
Privatization
Change from public sector to private sector
Owned or controlled by central or local government or public corporations
Certain public goods provided by public sector organizations
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