FORMS OF BUSINESS

ORGANIZATION
• SOLE PROPRIETORSHIP
• PARTNERSHIP
• LIMITED LIABILITY PARTNERSHIP
• COMPANY
SOLE PROPRIETORSHIP

• It refers to the form of business organization which is owned,controlled and managed by a single owner/individual.

Example: Any business owns by an individual owner i.e Franchise, Cafe , Shop,Restaurant etc
• Individual owner is responsible for all debts and profits, liabilities etc

Features:
Formation and closure is easy
Unlimited liability
Lack of business continuity
Quick decision making
Confidentiality of information
PARTNERSHIP

• It is an association of two or more people who co own a business for the purpose of
making profit.
General Partners:
Participate in day to day operations and are liable for debts and lawsuits.
Limited partners:
Investment in partnership but have no participation in day to day operations and usually
don’t have liability.
Features:
• Limited liability
• Agreement is required
• Registration is necessary
• Large capital is required
• Risk and profit shared among partners
• Minimum:2 partners
• Maximum:50 partners
LIMITED LIABILITY PARTNERSHIPS

LLP’s allows for a partnership structure where each partner’s liabilities are limited to the amount they put into
business.
A:30./.
B:40./.
C:20./.
D:10./.
• Rights and duties defined by LLP agreements
• Limited liability
• Separate legal entity
COMPANY

A company is a legal entity formed by the association and group of people to work together
towards achieving a common objective.
WAPDA
SNGPL
NETSOL etc
A company can only be dissolved as laid down by law
INTERNAL AND EXTERNAL ENVIRONMENT

• Internal: ( Micro environment)

Controllable Factors
• Value system
• Vision, Mission and objectives
• Organization structure
• Organization culture
• Human Resources
• Physical Resources and technological capabilities
External environment:
All things are meant to be study/ research before conducting the business.
Do PESTLE Analysis before doing any business as how external environment can impact a business?
PESTLE:
• Political
• Economic
• Social
• Technological
• Legal
• Environmental
PESTLE

Political:
• Government policies
• Political strategy
• Corruption
• Tax policy
• Labor law
• Trade restrictions
Economic:
• Monetary growth of a company’s management
• Financial benefits
• Monetary policies
• Employment rates
Social:
• Lifestyle
• Trends
• Consumer attitude and opinions
• Media views
Technological:
• Improvement in technology
• Up to date technology
• Level of innovation
• Technological awareness
• R&D
Legal:
• Discrimination law
• Consumer protection law
• Employee protection law
• Copy right and patent laws
• Health and safety laws
Environmental:
We must analyze our business should not have any negative impact on society or
environment.
CSR