Public limited businesses, or public limited companies (PLC), are

something we are all very much aware of. When people talk of

stocks and trading, they are talking about ownership of PLC assets.

But what does it mean to actually register and operate a public

corporation?

Is it something that can work for your business?

Today, our experts in business management and finance look at the

public limited company advantages and disadvantages to help you

choose the right direction for your company.

What is a PLC Company?

There are many popular types of self-employment in the UK,

including the establishment of a PLC — otherwise known as a public

limited company. Public limited company characteristics are quite

unique.

Unlike the position of a sole trader, who themselves are the

business, any type of limited company becomes its own legal entity,

with associated assets and liabilities. You can learn more about

what a limited company is and how it can benefit your business

here:

Three Benefits of Becoming a Limited Company

 A public limited business operates just as a private limited company

(LTD) does in terms of operational capacity; however, it is also

separate in how it works, as shares are open to public ownership.

Anyone can buy and sell stocks in the corporation, should they be

available. Because of this public access, the business must publish

its annual statutory account results to provide an accurate

representation of its current profits, financial position and tax

responsibilities.

You can learn more about what statutory accounts are here:

What is the Difference Between Statutory Accounts and

Management Accounts?

Most public limited companies are large corporations. However, any

company that meets certain structure criteria can establish itself

as a public brand. These include:

 Having at least two shareholders and company directors

 A brand value of at least £50,000

 Employment of a qualified company secretary.

But why become a PLC over an LTD? This blog explores public

limited business advantages and disadvantages and hopes to help

you make the right choice about your corporation’s status.

 Advantages of a Public Limited
Company:
 Directional Insight from Shareholders: Becoming a public

corporation is an invitation of partial ownership; an invitation that

can reach hundreds and even thousands of people, depending on

the size of your brand. This gives these individuals a direct line of

conversation with your company, with the potential to extract ideas

and experience to allow the company to evolve in ways an LTD

can’t.

 Reduction in Personal Liabilities: The more people associated

with a brand, the lesser the impact of legal ramifications upon an

individual’s shoulders, should there be any disputes where the law

is concerned. Private limited companies allow you to become less

liable than you would be if you were operating a sole trader

enterprise. However, there is still only a small pool of owners in this

set-up and, therefore, these types of businesses provide less

protection than a public brand when it comes to issues such as

debts, customer privacy concerns, and infringement of copyright,

etc. PLCs also allow for easy moving of shares and assets, which

makes an exit from the company far easier than in private limited

firms.
 Improve Branding and Prestige: Simply put, the biggest and

more successful corporations are public sector companies. Apple,

Microsoft, Facebook — they are all public. Being in the public

domain, trading assets and opening yourself to the stock market all

bring a certain level of brand prestige that can enhance your

reputation, investor perception and even increase value.

 Corporation Links and Alternate Growth Avenues: Those who

invest in your stock want to see your company succeed, allowing

them to make more money. Because of this, you may find your

corporation can create links with entrepreneurs, different types of

businesses and seasoned industry experts that would have been

previous unattainable — links that can provide new opportunities for

growth and profit maximisation. Of course, this is all subject to

speculation and dependent on who buys stocks, but the potential is

there. For example, if a marketing agency was to invest in your

brand, you may find it can help support growth through discounted

rates, consultations and trade, or at least offer new opportunities

for business exchange.

 Raise Capital through Public Buyers: The most popular reason

for any business to consider becoming a public limited company is

the acquisition of increased capital through the sale of stock. Stock

sales offer public members a stake in the company in return for a

financial investment. The sale of stock is perhaps the most sought-

after way to gain increased capital for both personal wealth

acquisition and business growth. Unlike angel investors, public

stock can be regulated in a way that means you gain the required

capital without handing off significant power to one individual or

group. The sale of stock is based entirely on company value. Learn

more about valuing a business here: