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Entertainment Law - Essay Example

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In the United Kingdom the main types of businesses that are usually started by investors are that of a sole trader, a partnership, a public or a private limited…
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Entertainment Law
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Entertainment Law

Download file to see previous pages... The advantages of this form of business would be that this business form is easy to establish and there are no legalities involved in setting up. Once the business is set up Vick can start trading as early as possible. An overwhelming advantage of being a sole trader is that one is not required to answer to anyone as they are the sole owners. Decisions regarding the company can be made quickly and efficiently.
However, being a sole trader can have a number of disadvantages such as a lack of collective minds. The owner may not have sufficient experience or knowledge to run the business and perhaps being in a partnership would help him. Being a single owner of a business can greatly affect the social life of a person as a holiday would mean a closed office. Economies of scale are also difficult to achieve and cost of production is comparatively high.
If Vick decides to go into a partnership he will have to invest less capital into the starting of the business but as such the profits from the business will also have to be shared equally amongst the partners. The variety in terms of minds in the ownership will help to enhance the business through the integration of qualities from all partners. Work can be shared and so can be the liabilities of the business. If the business does incur debt in a partnership there are fewer chances of personal assets being sold off.
Once again this business form has downsides of which the first would be the lack of freedom in decision making. Contracts are also required to maintain legal constraints on the business and the profit division terms need to be defined. And if one partner wishes to either retire from the business or expires the partnership is defunct.
As far as a public limited company is concerned, it will allow shareholders to have limited liability in the business and raising capital is easier as an additional issuance of debenture and ...Download file to see next pagesRead More
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