Forms of Business and Stakeholders Flashcards
What is a sole trader?
A business that is owned and operated by one person
What are advantages of a sole proprietorship?
Being your own boss
Receive all profit
Fewer legal requirements
What are the disadvantages of a sole proprietorship?
Unlimited liability
Shallow Growth
Limited input on business matters
Lack of continuity
What is a cooperative?
A cooperative is an organization formed by groups with similar objectives and interests
What are advantages of cooperatives?
Equal voting rights for members
Member contribution and shared responsibility Share the financial burden
What are the disadvantages of a cooperative?
Conflict among members Lack of confidentiality
Limited liability
What is a Franchise?
A franchise is a joint venture between a franchisor and a franchisee, with the franchisor being the original
What are some examples of a franchise?
KFC
BK
WENDY’S
POPEYES
What is a Partnership?
A partnership is a business that is jointly operated by 2-20 individuals
What are some advantages of a partnership?
shared responsibility
sharing of risk
better public relation
What are some disadvantages of a partnership?
Potential disagreements
Compromise on ideas
Profit sharing
Define the term stakeholder?
A stakeholder is any individual, group or organization that is affected by the activity of a business
Who are internal stakeholders?
Internal stakeholder are those within a company whose interest stems from direct employment, ownership or investment.
Give examples of internal stakeholders
Manager
Exmployees
The board of directors
Owners
Who are external stakeholders?
External stakeholders are those outside of a company who are indirectly affected by its decisions and outcomes
