A business is a form of trading that involves selling of various products and services to the clients or customers in different parts of the globe. There are several methods of beginning a business used by different people across the world. A business can either be started by a single person or even by a group of people which are some of the many ways of coming up with a business. The many ways that different people have been using to start up their businesses across the world have prompted the introduction of different forms of business ownerships across the world.
A business ownership is a great factor that determines the success of any kind of a business and thus important for every entrepreneur to consider the form of ownership he or she wants for his or her business before coming up with any type of a business. Business ownership generally implies the way a business is organized. There are different forms of business ownerships that any business person can consider for his or her business where some of the most common business ownership forms are discussed below.
The first form of a business ownership is known as sole proprietorship. It is important to know that most of the businesses across the world have sole proprietorship ownership thus making this form of ownership the most common and basic among the others. Sole means one and thus sole proprietorship form of ownership means that the business is owned by only one individual who is responsible for all the business operations.
It is important to know that there is no any other kind of a party that can be liable for various business losses apart from the owner of the business in the sole proprietorship business. It is also important to note that in this business, the profits and incomes generated by the business are only kept by the business owner. There are however some few reasons why sole proprietorship business is very important one of them being the flexibility and less capital requirements.
The other most common form of business ownership is the partnership form of ownership. Partnership form of ownership is a business that is owned by more than one person either two or more co-owners. Under this form of ownership, the partners generally share the profits equally. Corporations are some other forms of business ownerships that an entrepreneur should also consider when starting up a business. Raising capital in corporation businesses is very easy due to many sources of finance they have compared to other forms of business ownerships. Business ownership forms also include franchise, co-operatives as well as limited liability companies.