Ch 2: Types of Businesses Day 1: Forms of Business Ownership

1. Ch 2: Types of BusinessesDay 1: Forms of Business Ownership

2. Today’s Response Journal Question: What do you believe are the advantages and disadvantages of owning your own business? ***Date as Sept. 10 and save in your Response Journal Folder***

3. Forms of Business Ownership The main types of business ownership include: • Sole Proprietorship • Partnership • Corporation • Co-operative • Franchise • Sometimes labeled as a form of ownership but is actually a hybrid (combines features of several types of business ownership)

4. Sole Proprietorship • A business owned by _______ person, the proprietor • Responsible for all parts of the business • Gets to keep all of the ___________ • Assumes all of the _________ • E.g. Dr. Stephen Morrison (Dentist) One Profits Risk

5. Sole Proprietorship - Advantages • ________ to start up • Inexpensive to begin • Can record your business income on your _____________ tax return (no separate return to file) Easy Personal

6. Sole Proprietorship - Disadvantages • Has ______________________ • Responsible for claims against the business that goes beyond the amount invested and extends to personal assets Unlimited Liability

7. Partnership Two or More • A business with _______________ owners who share responsibility as well as profits/losses and risk • Terms of the partnership are recorded in a ______________________________ • States how profits and/or losses will be divided • E.g. Cellin0 & Barnes (Law Firm) Partnership Agreements

8. Types of Partnerships The 2 types of partnership include; • General Partnership • Limited Partnership

9. General Partnership • Most ____________ form of partnership • All partners have ____________________ for the debts of the business • Meaning all partners are responsible for claims against the business that goes beyond the amount invested and extends to personal assets Common Unlimited Liability

10. Limited Partnership • Partners are only responsible for paying back the amount that they ___________ in the business • Even if the business fails, the owner’s savings and personal assets cannot be used to pay partnership debts • Partners have _____________________ • The partners are only responsible for the amount they invested in the partnership Invested Limited Liability

11. Partnership - Advantages • Can use the skills of each partner • E.g. one person could be good at sales and another could be good at accounting • More ideas are generated • Risk is shared

12. Partnership - Disadvantages • Profits are shared • Could be more difficult to make decisions

13. Corporation • A business that is owned by, but exists separately, from its shareholders • Can be small or large • Ownership of a corporation is divided into small parts called __________ • ________________ are people who own shares in a corporation • Shares can be bought or sold through a ____________ __________________, such as the TSX • The more shares an owner has, the more ____________ they have over the business Shares Shareholders Stock Exchange Control

14. Corporation - Advantages Limited Liability • Owners have ____________________ • Which means they can’t be responsible for debts of the company • The ability to share in business profits by receiving ___________ • Dividends are the portion of a corporation’s profits (after taxes) that a shareholder receives Dividends

15. Corporation - Disadvantages • Owners don’t have much say in the day-to-day business of the corporation • The corporation is actually run by a Board of Directors • Expensive to start up

16. Types of Corporations There are 3 main types of corporation … • Private • Public • Crown

17. Private Corporation • Only a _______ people own the shares • Shares are ______ listed on a public stock exchange • E.g. Home Hardware Few Not

18. Public Corporation • A corporation with _______ shareholders • Shares can be ___________ or _______ on a public stock exchange • E.g. BlackBerry Many Bought Sold

19. Crown Corporation • A business owned and operated by the federal or provincial ________________ • E.g. VIA Rail, CBC, Canada Post Government

20. Co-operatives • A co-operative is a business owned by the ___________ or by _____________ who buy the products or use the services that the business offers • The motive for operating a co-operative is __________, not profit • The Board of Directors, who are members, own shares and run the company • Each member only has one vote, regardless of the number of shares owned • Profits of a co-operative are distributed based on how much each member spends at the co-operative Workers Members Service

21. Franchises • In a franchise operation, one business, the ______________, licenses the rights to its name, operating procedure, designs, and business expertise to another business, the __________________ • Essentially, a franchisee buys a license to operate a ready made business • A franchise offers _______________________ that consumers find very appealing • E.g. McDonald’s, Subway, Tim Hortons Franchiser Franchisee Brand Recognition Top 100 Global Franchises

22. Day 1 - Assigned Work Students please complete the following; • With a partner, complete the Activity: Types of Businesses(posted on ClassNet under Tasks)

23. Ch 2: Types of BusinessesDay 2: Starting a Business & Types of Businesses

24. Today’s Response Journal Question: What do you believe are the advantages and disadvantages to purchasing goods and services over the Internet? ***Date as Sept. 11 and save in your Response Journal Folder***

25. Starting a Business Money • ___________ is needed to start a business Start-up money is available through 2 kinds of sources … • Debt Financing • Equity Financing

26. 1. Debt Financing • Debt financing is money that is _____________ and that must be _____________ over a period of time • Sources of debt financing could include: • Family and/or friends • Banks and/or credit unions Borrowed Paid Back

27. Equity Financing Not • Equity financing is money does _____ have to be paid back • Sources could include: • Personal savings • Sale of shares to investors • Using equity financing often means giving up part _______________ of the business Ownership

28. Types of Businesses Businesses are classified according to __________ they do, and typically fit into one of the following categories; • Service • Retail • Not-for-Profit • Manufacturing What

29. Service Business • Service businesses make money by _________ something for others Examples include; • Hairdressers • Restaurants • Movie theatres • Lawyers • Accountants • Tanning Salons Doing

30. Retail Business • Retail Businesses makes money by selling a ____________ • Products are usually purchased from a producer to sell to the consumer Examples include; • American Eagle • National Sport • Costco Product

31. Not-for-Profit Business • A Not-For-Profit Business is an organization that does _____ exist to make a profit • Purpose is to meet the ________ of the community Examples include; • Habitat for Humanity • Canadian Cancer Society Not Needs

32. Manufacturing Business • Manufacturing businesses generate money by producing products from ___________________ and then selling them to consumers Examples include; • Toyota • BlackBerry • General Electric Raw Materials

33. Other Considerations Other factors that should be taken into consideration when starting your own business include … • Your skills and interests • Resource requirements • Location of the business

34. Skills and Interests • It is helpful to know what you’re good at and what you like doing, as this information could lead to business opportunities • Business ideas often come from … • Hobbies • Books • Magazines

35. Resource Requirements • Where do goods and services originate? They do not just suddenly appear in the marketplace • ______________________, also known as factors of production, are the means (ways) though which goods and services are made available to the consumer • There are 3 kinds of economic resources; • Natural resources • Human resources • Capital resources Economic Resources

36. Natural Resources • Natural resources are materials that come from the ____________________________ • E.g. soil, gold, trees, fish, water, etc. • Many resources are ___________________ and limited in amount • Some resources such as forests take many decades to _____________ Earth, Water and/or Air Non-Renewable Replenish

37. Human Resources • Human resources are the _________ who work to create the goods and services • E.g. farmers, factory workers, teachers, doctors, accountants, etc. People

38. Capital Resources • Capital resources include items such as _____________, ____________ or __________, that are used to produce goods and/or services • They are resources that last for a long period of time and are often very expensive to purchase Equipment Buildings Money

39. Location of Business Options can include; • Home-based • Office or factory • Web-based

40. Home-Based Office SOHO • Also known as _________, short for small office home office Advantages include; • Fewer meetings to physically attend • No travel (commute) to work • Working in your pajamas!

41. Web-based Business E-Commerce • __________________, which stands for Electronic Commerce, which involves conducting business (buying and selling) over the Internet • One advantage for consumers and businesses is that the business is open 24/7 • To conduct e-commerce, you must have a website and a domain name; which should be simple, catchy and professional

42. Day 2 – Assigned Work Students please complete the following; • Individually, complete the Activity: Examining the Rise of E-Commerce (posted on ClassNet under Tasks)

43. Ch 2: Types of BusinessesDay 3: International Business Structures

44. Today’s Response Journal Task: Individually, complete the Activity: Introduction to Population (Posted on ClassNet under Tasks) ***Save in your U1 Folder***

45. International Business Structures • Obviously a large world exists outside of Canada’s borders • We are a small country in terms of _______________ when compared with other countries around the world • Companies usually expand into other countries because they want to reach more ______________ and make more _________ Population Customers Profit

46. Forms of Business Structures for International Markets The following are different business structures that allow businesses to expand into international markets; • Joint Ventures • International Franchises • Strategic Alliances • Mergers • Offshoring • Multinational Corporations

47. Day 3 – Assigned Work Students please complete the following; • In small groups, as assigned by your teacher, complete the Activity: International Business Structures(posted on ClassNet under Tasks)