forms of ownership
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TRANSCRIPT
By SweetnessNkosiUniversity ofJohannesburg
FORMS OF
OWNERSHIP
BUSINESS ORGANIZATIONS: THE PRIVATE SECTOR
Sole tradersPartnershipsPrivate limited
companiesPublic limited
companiesCo-operativesClose corporationsfranchise
Choice of Suitable form of ownership – A Crucial Decision
The form of ownership determines the -Division of ProfitsExtent of liabilityExtent of RiskDivision of PowerControl of OwnerLong term commitment, cannot be altered easily
FORMS OF OWNERSHIP DETERMINES…
Ease of Formation
Suffi cient Finances
Limited Liability
Transferability of Interest
Effi cient Management
IDEAL FORM OF OWNERSHIP
SOLE PROPRIETORSHIP
A business owned and managed by one individual; the business and the owner are one and the same in the eyes of the law
Owned by 2 or more personsLeast numerous business organizationSmallest proportion of sales and net
income
PARTNERSHIPS
CORPORATIONS
Corporations account for 1/5 of all firms in the U.S. and 90% of all sales
A corporation is a form of business organization recognized by law as a separate legal entity having all the rights of an individual
Limited Liability Partnership & Company
Joint VentureS-
Corporation
Nonprofit
Corporation
Franchise
Cooperative
Other Forms of Business Ownership
UNT in partnership with TEA, Copyright ©. All rights reserved 8
What is Franchise?A franchise is a business established by one person who buys copyrights of another firm and is allowed to produce and distribute that product.
FRANCHISING
Nature of Business
Size and Area of Operations
Degree of Control Desired
Amount of Capital Required
Degree of Risk Involves
FACTORS TO CHOICE OF OWNERSHIP
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