Types of Businesses and Forms of Business

Sole Proprietorship

Definition:
A company run by one person

Pros:
100% Control
All profits go to you
Easy to start up

Cons:
Have to pay for all expenses
Hard to get loan
Creditors can come after personal property
Harder to raise capital over long-term basis

Doctor
Dentist
Attorney

Partnership

Definition:
Just like sole proprietorship
but with 2 or more people

Cons:-50/50 debt, so the debt will be shared with your partner
-Creditors can go after personal property to satisfy a claim

Pros:

-Less paperwork than corporation
-Less expensive

McDonald’s, Apple, Microsoft, Ben and Jerry’s

Corporation

A corporation is
a legal entity that is separate from its owners

Pros:
-Owners are not involved with legal liability, so owners are not responsible for lawsuits and debts

-Sell stocks to investors, that increases financial capital

Cons:
-Time consuming
-Expensive

Franchise

Definition:
A company that allows a certain
individual to carry out activities as the company and the individual agree on.

Cons:The chance of the business failing is really low because the franchise is already branded:therefore customers trust this franchise

Pros:The chance of the business failing is really low because the franchise is already branded:therefore customers trust this franchise

Cooperative

Definition:
A Business owned by its customers

Pros:

-Cheap to register
-All members/customers
-Members can be under 18: they cannot be directors however

Cons:

-Hard to find customers seeking financial returns
-Limited distribution of Profits

Definition: A service that provides you with a service
non physical product that fulfills your daily needs

Advantages

Understand better what your competition is Bell and
Rogers are one of them. Which has a faster internet speed.

Disadvantages

Demand cutbacks, people will back away from your
if you start to increase prices, or lower service qualities