Many people don’t know what business law is and so hopefully this essay will help clear that up and increase the knowledge about one exact topic in business law which is partnerships ,business law in general encompasses the law governing contracts, sales, commercial paper, agency and employment law, business organizations, property, and bailments. Other popular areas include insurance, wills and estate planning, and consumer and creditor protection. Business law may include issues such as starting, selling ,or buying a small business, managing a business, dealing with employees, or dealing with contracts, among others.
Now lets get into details and start with the business organizations there is the private sector which includes the soletrador and the partnership which includes (unlimited partnership (UP), limited partnership (LP) and limited liability partnership (LLP) ) , and the last privat sector in business is the Company , as for the public sector well it includes business that a government brings into the public sector which provides goods or services to the public ona national basis with a complete or partial monopoly .
Now lets talk a little about the differences between the public and the private sectors , firstly , private sector businesses are owned by private people but as for the public sector businesses they are owned by the country as a whole , there are no individual owners in the public sector, secoundly , private sector businesses are controlled by the people who own them or by directors and managers appointed to do so , but public sector businesses are controlled by the government or local authority, the third difference is the method of raising capital , in private sector businesses the capital is invested by private people but as for the public sector the capital is always taken from the public and invested in the company as shares , the fourth and major difference is the way in which the profit of the business is used or losses are met, in the private sector almost all the profit is distributed over the owners but as for the public sector the profits are handed back to the government and their losses are offset by the treasury . as for the final and most important difference between businesses in the two sectors is what they aim to do , in the private sector they always aim to maximize profits for their owners , in the public sector businesses, however, the aim is to give a service to the people and less importance is placed on the profit making .
Now as we talked about the differences between the two ectors I am going to get more into each sector and talk about it individually and so lets start with the private sector and the first part of it which is the sole trador it is the simplest way to run a business – it does not involve paying any registration fees, keeping records and accounts is straightforward, and you get to keep all the profits. However, you are personally liable for any debts that your business runs up, which make this a risky option for businesses that need a lot of investment. There are many advantages and disadvantages to being a sole trador , and so lets start with the advantages which are , immense not lease because the owner has full control over the business for daily operations as well as how large they wish to grow it.
It’s easy to set yourself up as you only need to declare to yourself you are going to be a business but also have to inform the Inland Revenue you are self employed within 3 months of starting the business , the second one is A sole trader does not need to complete many of the forms and accounting information that limited companies need to produce although accounts should be developed when preparing for your annual self assessment tax return where you declare your annual profits and tax liability , the third advantage would be that As there are no staff on hand the owner also takes all of the profits made by the business and all financial information is kept private (whereas limited companies need to file accounts each year at companies house). You don’t need to register a company either and can be known as almost anything and most people have businesses that are “trading as”, the fourth and one of the important advantages is that the Decision making is also fast as it’s just the owner who decides where the business is heading and whether or not to undertake any work and where and when they will work.
They are generally closer to their customers and offer a more personalised approach and improved customer service as they are the person each customer has contact with, and the fifth and last advantage would be that Accountants generally charge less for company accounts and advice because there is less work to undertake. You just need to complete a profit and loss account rather than a balance sheet and cash flow (although it’s worth preparing these last 2 on a regular basis to manage your business). Lets get into the disadvantages of the sole trador now which consists of three and the main disadvantage is that you, as the owner of the business, are solely liable for any consequences of business failure or any other iability for example injuring a customer or property damage although these can be mitigated against with public liability insurance, the second disadvantage would be that, It may also be quite difficult to get larger jobs not only because large corporations have many staff that can work on tenders and offers but because most organisations won’t work with a business that only has a staff of one. It can also be time consuming following up on tenders that ultimately don’t come to fruition, and the thirds and last sidadvantage of being a sole trador is that, You may also need to think about what would happen if you as the business owner were to become sick or had an accident so you couldn’t work. Although critical illness insurance is available some times it doesn’t start to pay until after one month and it is unlikely to be at the levels of profits the business is making but it is certainly worth considering.
Now as we can see the advantages of being a sole trador are more than the disadvantages and so it is one of the good businesses to do since the diction making is all up to you and the profit all heads back to you as I said up in the advantages. Now because there are a lot of businesses in the private sector I am going to only talk about one from each. What about the public sector what does is consist of and why is it called the public sector , well all that is going to be cleared up in the upcoming paragraphs hopefully . Now earlier I talked about the differences of the private and public and I got you a little familier whith the private sector and what its role is in society , but as for now well I am going to get a little into the public sector and tell you its advantages and disadvantages and examples of what businesses in the public sector can be ,