Name of Student: Shimar Henry

Course Name & Number: BUS 141

Topic: Private Sector – Sold Traders & Partnership, Franchising and Joint Ventures
Question 1: Complete question 1 Joana Carter

a. As a sole trader Joana Carter has unlimited liability. What does this mean?
Unlimited Liability means all of Joana Carter’s assets are potentially at risk. She’s
personally liable for the debts and liabilities of the business, especially if the business
fails.
b. Explain two advantages to Joana Carter of operating as a Sole trader.
 A Sole Proprietorship is easy to set up: No major legal procedures or formalities
are required to set up a Sole Proprietorship, however, in certain situations licenses
are required; it isn’t compulsory to register your business, although it is
recommended.
 Owner has complete: You have absolute control over all the decisions made, due
to you being the only/sole owner of the business.
c. How did Business Link help Joana Carter in running her small business?
Business Link helped Joana Carter in running her business by providing her with
business advice, resources and information soon after setting up the business. They also
assisted her by paying half of the advanced skills course, which costed £900.
Question 1: Complete Case Study: Oxford Vintage cars

a. Using this case as an example, explain what is meant by a partnership.

A Partnership is an agreement between two or more individuals called partners, to
carry on a business together with the common goal of making profits. Partnerships
can be formed orally or by deed of partnership, as shown in the information a deed of
partnership was drawn up, refer to the 5th paragraph. Each partner contributes to
capital, Hristo Petrov and Mark Watkins contributed to capital by providing £50,000
each, which amounts to £100,000. Furthermore, partners may specialize in different
areas of the business, for example, Mark Watkins is good on the restoration side of
the business and supervising mechanics whilst Hristo Petrov is good at trading,
buying and selling.
b. Oxford Vintage Cars is an unincorporated business. What does this mean?
This means Oxford Vintage Cars, the business, and the partners, Hristo Petrov and
Mark Watkins are the same legal entity. So, the partners/owners may sue or be sued
personally, not through the business. Partners have unlimited liability, therefore, if the
business fails they are responsible for the debts.
c. How does this case highlight one of problems of operating as a sole trader?
This case highlights one of the problems of operating as a sole trader because a Sole
Proprietorship is also an unincorporated business, the owner and the business is the
same legal entity also they have unlimited liability, the owner of the business is
personally liable for all business debts.
d. Why do you think Hristo did not want to enter a business partnership?
I think Hristo did not want to enter a business partnership because the profits made
will have to be shared amongst himself and another partner(s), the decision-making
procedure will be longer since he’s not the sole owner, requires more legal documents
a deed of partnership and registration for instance and if one partner makes a bad
decision, it affects him and all the other partners, who’s in the partnership.
e. To what extent will the partners be able to specialize in the business?
To a certain extent, since it depends on what the partners specialize in. For instance,
with Oxford Vintage Cars, Hristo specializes in buying and selling, while Mark
 specializes in bringing new ideas to the business and supervising the mechanics.
Partners, if capable, can also take up roles of managing certain department areas of
the business.

Question 2:

a. The franchisor is the parent company that sells the franchise, which includes the right to
use the name, logo and marketing methods, to the Franchisee who in returns pay a variety
of fees, initial sum and a percentage of total sales (royalties)
b. There are a variety of advantages an entrepreneur has instead of setting up their own
pizza delivery service, for instance he has a higher survival/ success rate because the
franchise is a recognized name known to prospective customers, suppliers or investors,
the franchise receives support from franchisors, if it’s underperforming, an already
created product, and the franchisee gains benefits from the research and development
done by the franchisor. There are some disadvantages that come with franchising, in
terms of the franchisee, which includes: franchisee has to pay an abundance of fees to the
franchisor, such as an initial fee. A percentage of their sales/revenue at least 10% most
likely, franchisee does not have much control over the franchise and condition/case that a
franchisee fails to keep to the contract, they can lose the franchise.
c. Here are some advantages to the American company which owns the Domino’s Pizza
franchise of using a business franchise model.
 They earn royalties from sales and initial payment from the franchisee.
 They benefit from skills and efforts of committed enthusiastic franchisees.
 Generation of fresh ideas, franchisees can bring prospective ideas for the future of
the business that the company has not thought of.
 Reduced cost of operation the franchisees provide the capital needed for their own
outlet and the company receives fees and royalties from the income of the
franchisees
Ford teams up with Chinese Auto Maker

1. What seems to be the main reasons for the joint venture are the benefits, which includes;
 Utilization of another company’s resources promotes expansion ford took
advantage of China’s fast developing Auto Market.
 Acquiring expertise from the other firm
 Risks and costs are shared between the two firms
 Product diversification, addition of a new products(s) to an existing products line,
for instance, Changa’an-Ford manufacture and sell ford designed cars, cars parts
and other components.
2. In my opinion, I think American Auto Giant Ford gained most from this venture because
in the passage, it stated that “the auto giant considers its latest move a necessary strategy
to be part of China’s fast-developing auto market” and “Chang’an Automobile group
ranked first in China’s mini car production last year”. The China Automobile group has
been established for a long time, so the American Auto Giant ford benefits from the
expertise and experience of the chinses automobile group.
3. Here are problems might these two businesses might face in dealing with each other in
the joint venture; Chang’an Ford:
 There might be disagreements between two firms
 Poor integration and co-operation due to differences in culture and strategies
 Long and tiresome decision- making process is possible
 Independence is loss
4. According to the article boots was so keen to establish joint ventures for expansion and
gain more exposure because a regional information service lists local boots stores where
people can visit for health products. Joint Venture promotes boots’ business.
5. This might be a good reason for this joint venture because both business has access to
each other’s resources. They don’t have to spend more money if one of the business has
the resource the other is looking to obtain, Rate/chance of success will most likely be
higher as they are partnering with each other. A high reputation can be gained as a result.
Both businesses utilize the expertise and experience of the other, Boots might be good at
financing and Granada might be good at marketing, this might not be good for this joint
venture because one of those businesses may have a different management style to the
other, so if unsupervised, Boots or Granada might diverge from a goal and do otherwise.
Poor integration might be a result of a difference in strategies, boots and Granada might
plan and conduct themselves absolutely different from each other, so trying to pool
resources and other components might be difficult.