Damon Barrett
Mind Map by Damon Barrett, updated more than 1 year ago
Damon Barrett
Created by Damon Barrett over 5 years ago


Mind Map on A292, created by Damon Barrett on 12/11/2014.

Resource summary

1 Types of business ownership
1.1 Sole Proprietor
1.1.1 Many sole proprietors do business under their own names because creating a separate trade name is not necessary.
1.1.2 Also known as 'proprietorship'
1.1.3 These are unincorporated businesses with one owner that pays personal income tax on profits from the business.
1.1.4 This is the simplest business to set up, making them popular among individual business owners.
1.2 Partnership
1.2.1 An organisation in which 2 or more individuals manage and operate a business.
1.2.2 Both owners are equally liable for debts that the business has created.
1.3 Public Limited Company
1.3.1 Two or more people are required to form this type of business.
1.3.2 A company which has offered shares to the general public and has limited liability.
1.3.3 A PLC's stock can be acquired by anyone and holders are only limited to potentially lose the amount paid for shares.
1.4 Private Limited Company
1.4.1 This type of business does not need to meet strict securities and exchange commission filing requirements of public companies.
1.4.2 A company whose ownership is private.
1.5 Public Corporations
1.5.1 A company whose shares are publicly traded and are usually held by a large number of shareholders.
1.5.2 A government owned company such as an airline or public transit company.
1.6 Incorporated
1.6.1 This type of business allows for easy transfer.
1.6.2 Achieves lower tax rate.
1.6.3 The process of legally declaring a corporate entity as separate from its owners.
1.6.4 Protects owner's assets.
2 The three sectors
2.1 Primary sector
2.1.1 this involves acquiring raw materials. For example, metals and coal have to be mined, oil drilled from the ground, rubber tapped from trees, food farmed and fish trawled.
2.1.2 Also known as 'extractive'.
2.2 Secondary sector
2.2.1 this is the manufacturing and assembly process. It involves converting raw materials into components, for example, making plastics from oil. It also involves assembling the product, e.g. building houses, bridges and roads.
2.2.2 Also known as 'manufacturing'.
2.3 Tertiary sector
2.3.1 this refers to the commercial services that support the production and distribution process, e.g. insurance, transport, advertising, warehousing and other services such as teaching and health care.
2.3.2 Also known as 'services'.
2.4 The chain of production shows interdependence: firms rely on other businesses in different sectors for raw materials, components or distribution.
3 Recruitment
3.1 Recruitment is the process that businesses go through to gain staff.
3.2 An important way to advertise a vacancy is to include a job description, as well as job specification.
3.3 Retention is how a business is able to retain its staff/employees.
3.4 The process: The business realises that it needs more staff. They then announce that they are recruiting and advertise a job description and specification. They go through multiple CVs and job applications. Then the interview process begins, and successful applicants will be hired.
3.5 CV: This is a profile/personality of the applicant.
3.6 Application form: This is written by the applicant explaining why they believe they are suitable for the job.
3.7 Interviews: The interviewer will meet the candidate for discussion.
4 Shareholders
4.1 People are able to purchase shares of a business on the stock market.
4.2 Shares can be used as a means of raising finance and making money.
4.3 A minority shareholder is someone that owns a very small part of a business.
4.4 A major shareholder is someone that owns a substantial part of a company e.g. the CEO.
4.5 Shares can fluctuate depending on how much money the business is making, if there is a takeover bid, or if a company's future looks bright.
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