There are five different types of private sector businesses; sole traders, partnerships, private limited companies, public limited companies, co-operatives. Sole trader is a business owned by one private person. It is the most common business enterprise. Partnership is a group or association of at least two people who agree to own and run a business together. Private limited companies are small businesses and aren’t run on the stock market. However, public limited companies are huge businesses run on the stock market. Co-operatives are businesses run by all the partners, bearing the profit and loss.
Tag: businesses
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Sole Trader
A sole trader is the simplest form of business structure and is relatively easy and inexpensive to set up. A sole trader is legally responsible for all aspects of the business. They make all the decisions about starting and running your business. The sole trader is also effected by any profit or loss the company makes. Being a sole trader is risky because of unlimited liability, which means that a sole trader’s personal assets can be taken away if they are late on payments and/or things go wrong. But it is relatively easy to change business structure if the trader’s business grows or if they wish to wind things up.
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The Purpose Of Business Activity
Basically, as humans we all have needs and wants. Needs are the things we can’t live without while desires are things we can live without. We as humans have unlimited wants. Business activity exists to satisfy these needs and wants.