Business Ownership
- A sole proprietorship is a venture in with one owner. Service providers, professionals, and retailers can be sole proprietors. The main advantages that make sole proprietorship a common venture revolve around economics and simplicity.it is the easiest form of a business venture to a start-up since it does not require the filing of documents to the government as long as one carries out the business under his or her legal name. According to (Kim et al., 2020, p. 2), a sole proprietor has total control of the business since there are no shareholders or board of directors to appease. However, a sole proprietorship also has some disadvantages. First, a sole proprietor finds it hard to raise capital when he or she needs to expand the business because unlike other business ventures, the business cannot sell shares to raise capital. Also, the owner of the business venture does all the work alone, which at times gets very exhausting. A computer repair business is a good example of a sole proprietorship.
- A partnership has several advantages and disadvantages. For advantages, a partnership is a less formal business venture compared to limited companies and thus requires less legal obligations. It is an easy venture to start since the partners can agree on terms through word of mouth or in writing (Munawar et al., 2019, p. 2). Also, compared to a sole proprietorship, a partnership can benefit from mutual support and companionship from fellow partners. For disadvantages, a partnership has an unlimited liability since the business does not own a separate legal personality. Partners are liable for losses and debts incurred. A good example of a partnership is the Red Bull & GoPro.
- A corporation is the most common form of business venture, first due to the easier way of raising capital with the sale of bonds and shares (Ömür, 2018, p. 3). Secondly, the transfer of shares in a corporation is very easy. It can be done by the sell of shares. Thirdly, a corporation has perpetual lifetimes in that the entity lives on even in the event where the owners die. A good example of a corporation is the General Motors Corporation.
- A cooperative has some unique characteristics that distinguish it from other business ventures. First, its membership is voluntary in that a member can enter, stay, and leave the corporation whenever he or she feels like (Emery et al., 2017, p. 3). Secondly, its membership is open to everybody regardless of colour, race, sex, and creed. Lastly, a co-operation has a democratic control where it is managed by a committee elected at a general meeting by the other members. A good example of a co-operation is the MFA Incorporated.
References
Emery, S. B., Forney, J., & Wynne-Jones, S. (2017). The more-than-economic dimensions of co-operation in food production. Journal of Rural Studies, 53, 229-235. https://doi.org/10.1016/j.jrurstud.2017.05.017
Kim, H. J., Lee, B. K., & Sohn, S. Y. (2020). Comparing spatial patterns of sole proprietorship and corporate payday lenders in Seoul, Korea. The Annals of Regional Science, 64(1), 215-236. https://doi.org/10.1007/s00168-019-00969-0
Munawar, F., Rahayu, A., Disman, D., & Wibowo, L. A. (2019). Management commitment and partner relationship program toward export performance of handicraft industry. Proceedings of the 1st International Conference on Economics, Business, Entrepreneurship, and Finance (ICEBEF 2018). https://doi.org/10.2991/icebef-18.2019.34
Ömür, G. A. (2018). The designing of organization structure in innovative firms. Handbook of Research on Strategic Innovation Management for Improved Competitive Advantage, 68-84. https://doi.org/10.4018/978-1-5225-3012-1.ch005