Mr. K. Day provides a service so Mr. K. Day is not in any of these categories. A&A are at the moment the leading cab firm and possibly the most recognised in Pitsea and Basildon. This means that Mr. K. Day may get more profit because of this. Hobson's are in the category of retailer and manufacture because raw materials are made they sell goods to associations that need the uniforms like the army and the scouts. Hobson's are a leading manufacture of uniforms and clothing. Hobson's will get more profit than other clothing firms.
Type of ownership. The type of ownership can change the way a business grows and develops. Each type of ownership has its advantages and disadvantages. Here are the different types of ownership: Sole trader: A sole trader is someone who works for him/her self. The business is very small. The start up costs are small. Mr. K. Day can employ people if he wants and maybe even go into a partnership. Only Mr. K. Day can expand the business but it would be hard.
Profits are all kept. The amount Mr. K. Day spends is up to him but he needs to keep in mind those bills that are needed to be paid. Decisions can be made quicker and Mr. K. Day liable for any actions taken. The business is easy to set up. Mr. K. Day can work whatever hours he wants to. Mr. K. Day has unlimited liability, which means that his own property can be taken away. There are difficulties in raising money. There is slow growth and high risks of failure. There is also lack of continuity.
Partnership: A partnership is two people owning a business and is very easy to set up. Business affairs can be kept quite. They can both raise more money to expand the business. They can earn more capital than a sole trader. They can carry out the same activities as a sole trader and may also have unlimited liability. Mr. K. Day can move into a partnership if he wants to. They both need to work out each of the partners rights and responsibilities and make the responsibilities equal. They may also disagree from time to time over issues in the business. Having a deed of partnership doesn't make things work out better but possibly make things worse if they break up. They usually use one partner's savings to start up the business. The partners can have people called sleeping partners, who have limited liability.
Private limited company: A private limited company needs to have LTD in its name. Private limited companies and public limited companies both have the same advantage and disadvantages. They can attract shareholders a lot easier than most ownerships. Information about the company is given to the public. It is very expensive to set up reports about the company. Hobson's are a private limited company and decided to become a private limited company in 1860 because it can be a family business and also because of limited liability. Hobson's may take more risks as they will not loose their own passions but they will lose the money they started off the business with. This will make them more adventurous. The family didn't want to become a sole trader in case they fail and their personnel property may be taken away from them. Hobson's have limited liability. There must be two or more members. The capital is divided into shares but can only be sold privately, not on the S.E. Hobson's is a family business. Hobson's have 17 shares.
Public limited company: The company must have PL in its name. Private limited companies and public limited companies both have the same advantage and disadvantages. They can attract shareholders a lot easier than most ownerships. Information about the company is given to the public. It is very expensive to set up reports about the company. This is the largest ownership. The owner has limited liability. There must be two or more members. The company can advertise shares on the S.E. This helps raise the capital. An investor becomes part owner and shares in profit and a say in running the business.
The owner's liability: The word Liability means state of reliability. Hobson's have limited liability. This means that creditors, government and lots of other people who Hobson's owe money to and can take the money from Hobson's used to start up Hobson's and then Hobson's will go bankrupt or go bust. Hobson's have public and insurance liability. Mr. K. Day has unlimited liability, which means that people can take Mr. K. Day's house, car, money and much more of his property away from him.