Types of Business Forms and Their Organisation

NB: We do not resell your papers. Upon ordering, we do an original paper exclusively for you.

NB: All your data is kept safe from the public.

Table of Contents

Introduction
Federal Trade Commission
Conclusion
References

Introduction

Business forms can vary depending on the needs and capabilities of a particular company. Of all potential types of business organizations, partnerships, corporations, sole proprietorships, and cooperatives are among the most well-known. Partnerships are types of businesses established and funded by at least two people. Compared to other alternatives, they are easier to set up, and the owners are able to appropriately distribute the workload (Indeed Editorial Team, 2020). On the flip side, avoiding disagreements becomes a primary concern for the business, along with regulating ownership and debts, which can all be problematic (Indeed Editorial Team, 2020). Corporations, as another type of corporate management, rely on their management and shareholders in order to succeed. This method of organization helps a company benefit through stocks and also allows its members to utilize a tax exempt status to reduce profit margins (Indeed Editorial Team, 2020). As a tradeoff for these convenience measures, corporations should produce regular records of their activity and finances, pay taxes, and find a way to manage a business solely with managers. All of these present an issue when trying to quickly or efficiently run a business, and also take much more effort to organize than partnerships or sole proprietorships.

Sole proprietorship, compared to all other methods of business organization, stands unique in only one individual having full control of a company. With low costs of entry, simple paperwork, and lax regulations from federal agencies, it can be a great way to kick start a company (Indeed Editorial Team, 2020). Its small-scale nature, however, is also its biggest drawback, presenting more difficulty in raising funds. Other types of organizations provide more pathways to financing and further development opportunities. A total opposite of a sole ownership of a company would be the cooperative, which seeks to give the workers a level of authority and power to run the business together. It is an approach with the largest democratic potential, and varied funding options (Indeed Editorial Team, 2020). The diversified structure does provide a lack of personal accountability, but that flaw is possible to remedy through effective management and policy. In addition, it is also an environment where each investor has equal influence, coming into direct contest with investment-driven company organization principles.

Federal Trade Commission

The federal trade commission was established in order to regulate what businesses are allowed and not allowed to do. As an agency, it protects customers, establishes restrictions and anti-monopoly policies, and advocates for more transparent business practices. It is a barrier between the buyers and the organizations that caters to the public. The federal trade commission gives people a necessary degree of security in buying goods or services. In order for a business to stay successful, relevant, and legally clean, business owners must have a level of education in the federal trade commission practices. Many sections covered in the federal trade commission act deal with real issues that customers may face within the business sphere. For example, deceptive advertising falls under the regulation of the FTC. By regulating such claims, the commission is able to protect customers from being preyed upon. As an example, the case of Kellogg’s Rice Krispies can be considered. The firm has used their cereal packaging to state that the product is capable of boosting the consumer’s immune system (Monaco, 2022). This claim was false and unsubstantiated, causing the FTC to take notice. The company faced a possibility of legal action, and chose to compensate its customers 2.5$ million in total (Monaco, 2022). This case shows the direct financial effect of engaging in deceptive advertising.

Conclusion

In conclusion, it can be said that businesses face significant challenges, both in adhering to the law and setting up their companies. There are many potential ways to organize a business, each of which suit their own type of organization and leadership. Choosing between partnerships, sole ventures, and cooperatives can be difficult, and the choice will likely determine the direction of a company’s growth. When established, organizations also have to account for various regulations, laws, precautions, and concerns. By navigating the market and the surrounding environment with care, businesses gain the capacity to prosper.

References

Indeed Editorial Team. (2020). Forms of business organizations: Advantages and disadvantages. Indeed Career Guide. Web.

Monaco, E. (2022). The untold truth of Rice Krispies. Mashed.com. Web.

Click Here To Order Now!

Types of Business Forms and Their Organisation

Do you need this or any other assignment done for you from scratch?

We have qualified writers to help you.

We assure you a quality paper that is 100% free from plagiarism and AI.

You can choose either format of your choice ( Apa, Mla, Havard, Chicago, or any other)