Business Organizations
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Transcript of Business Organizations
Business Organizations
Different Forms of Business
Learning Target
• I can explain the different types of business organizations.
• I can list pros and cons for each.
Focus Questions
• How would you describe the businesses that you most often visit?
– Local Business? National Chain?
– Who is the Owner(s) of the Business?
Business Organization
• A business organization is the ownership structure of a company or firm
• Can you name some types of business organizations?
Sole Proprietorships
• A sole proprietorshipsole proprietorship is a business owned and managed by a single individual
• The single owner earns all profits and responsible for all debts.
• Sole proprietorships are the most common form of business organization
• Yet they generate only about 4 percent of all United States sales
• Examples in Milwaukie?
Partnerships3 Categories of Partnerships• General Partnership
– In a general partnership, partners share equally in both responsibility and liability
• Limited Partnership– In a limited partnership, only one partner is
required to be a general partner, or to have unlimited personal liability for the firm
• Limited Liability Partnership– A newer type of partnership is the limited
liability partnership. In this form, all partners are limited partners
Franchises
• A business franchisebusiness franchise is a semi-independent business that pays fees to a parent company in return for the exclusive right to sell a certain product or service in a given area
Corporations
• A corporation is a legal entity, or being, owned by individual stockholders– Stocks, or shares, represent a stockholder’s
portion of ownership of a corporation– A corporation which issues stock to a limited a
number of people is known as a closely held corporation
– A publicly held corporation, buys and sells its stock on the open market
Corporate Mergers
• Horizontal Mergers– The combining of two or more firms in the
same market with the same good or service• The Government may try to block the merger to
prevent monopolies
• Vertical Mergers– Two or more firms in involved in different
stages of production of a good or service
Corporate Mergers
• Conglomerates– a business combination merging more
than three companies that produce unrelated products or services.
Multinationals
• Produce and sell goods in more than one country
• Obey laws and pay taxes in the countries where they operate
Cooperatives• A cooperativecooperative is a business organization
owned and operated by a group of individuals for their shared benefit
• Consumer Cooperatives– Retail outlets owned and operated by consumers – Sell their goods to their members at reduced prices
• Service Cooperatives– Provide services, rather than goods (credit unions)
• Producer Cooperatives– Agricultural marketing cooperatives that help
members sell their products
Non-Profit Organizations
• Institutions that function like business organizations, but do not operate for profits are nonprofit organizations– Public Schools, Red Cross, Hospitals– Professional, business and trade
Organizations– Labor Unions