The document outlines the two main sectors of the economy: the private and public sectors. It details various forms of business organization within the private sector, including sole traders, partnerships, private limited companies, and franchises, as well as mentioning not-for-profit businesses. Additionally, it highlights the differences between businesses with unlimited and limited liability.

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Types of Business
Organisation
BTEC Business

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Two Sectors
The economy can be divided into
two sectors:
•The Private Sector
•The Public Sector

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The Private Sector
• Private individuals and firms that
are owned by private individuals
• Firms in the private sector include:
– Sole Traders
– Private Limited Companies (Ltd)
– Partnerships
– Public Limited Companies (PLC)

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The Public Sector
• Made up of central government,
local government, and businesses
that are owned by government
• In the last twenty years the number
of government-owned firms in the UK
has shrunk massively
• Now, very few examples remain:
for instance, the Royal Mail

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Private Sector Firms
One of the key differences is between:
• Sole traders and partnerships
whose liability is unlimited
And
• Private Limited and Public Limited
Companies, who have ‘limited liability’

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Other Business Types
• Co-operatives are owned by their
staff, who are ‘members’ of the
firm
• Profits are shared
amongst the members
• Losses too must be shared

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Franchises
• Many businesses today
are franchises
• A business idea is licensed
to a franchisee
• The owners of the brand receive
a license fee
• The franchisee gains the right
to use the business brand

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Not For Profit Businesses
• Many charity-based business
organisations are run as ‘not for profit’
operations
• They typically receive donations
or funds from groups or government
• Any financial surplus is ploughed back
into the business
• The organisation does not aim
to generate profits