Theme 1: Investigating small businesses, Topic 1.4 Making the business effective

Theme 1: Investigating small businesses, Topic 1.4 Making the business effective

Limited liability The level of risk is limited to the amount of money that has been invested in the business of promised as an investment

Incorporated A business that is registered as a company, so the business and the owners are separate in the eyes of the law

Unlimited liability The level of risk goes beyond the amount invested, so the personal assets of the business owner can be used to pay of the business's debt

Unincorporated A business that is not registered as a company, so the owners and the business are the same body in the the eyes of the law

Sole trader A type of unincorporated business that is owned by just one person

Partnership A business that is owned by a group of two or more people who share the financial risk, the decision-making and the profits

Deed of partnership A legal document that defines the terms of a partnership

Private limited company An incorporated business that is owned by shareholders

Shareholders Investors who are part-owners of a company. They invest in the business in return in return for a share of the profits and voting rights at the AGM

Franchise When one business gives another business permission to trade using its name and products in return for a fee and share of its profits

Franchisor An established business that gives permission to an entrepreneur to trade using its name and products

Franchisee An entrepreneur who pays a fee to trade using the name and products of an established business

Labour Workers or the workforce

Footfall The number of people passing a particular location within a given time period

Demographics The characteristics of the population, such as gender, age, religion and wealth

National Living Wage The minimum amount that a business is legally allowed to pay its employees

Bulk gaining product…