Forms of Business Organization Comparison

List characteristics for each form of business organization as you respond to each question at the left.
Characteristics Sole Partnership Corporation Multinational
Proprietorship Corporations
Describe the A sole A partnership is a A corporation is A corporation that
owners of this proprietorship is a business owned by a form of has manufacturing
form of business owned two or more people. business or service
organization. and run by a single organization operations in a
person. recognized by number of different
law as a countries
separate legal
entity having all
the rights of an
individual.
Advantages 1. Easy to Start 1. Ease of establishment 1. Ease of raising 1. Help spread new
financial capital technology
2. Ease of 2. Ease of management
Management 2. Hire best talent 2. They generate new
3. Larger size makes it available jobs where they are
3. Keep all profits more efficient needed
3. Limited liability
4. Be own boss 3. Produced tax
revenue for host
country

4. Creates jobs
Disadvantages 1. Unlimited liability 1. Fully responsible for 1. Difficult and 1. Influence political
other partners expensive to gain life of host nation
2. Difficult raising charter
financial capital 2. Limited life 2. Exploit economy of
2. Owners have host nation
3. Not big enough to 3. Potential conflict little say in running
operate efficiently between owners business 3. Plant is built
abroad, takes jobs
 4. Split sales/both 3. Expensive away from home
financially invested taxes on profits

Is this form of Very Easy Easy Difficult and Difficult and

business easy or expensive expensive
difficult to start?
Who receives the Whoever created the Both partners Everybody who Everybody who
profit from this business works for works for company
form of business? company

What are Mowing yard, making Corleones, Hewlett 3-M, 7/11, ABC Coca-Cola, Intel, SC
examples of this cakes, fixing Packard, Warner Bros Johnson
form of business? computers, self-
answers may vary employed carpenter