Types of businesses
Type
Definition
Examples
Characteristics
Sole Trader
(Sole Proprietorship)
A sole trader business has one person who
owns and runs the business. The business
may decide to employ other people to work
in the business, however the owner
provides all the finance and makes all
decisions.
-
Hairdressers
-
Tradespeople
-
Business consultants
A sole trader business has full control over
the business operations, decisions, and
finances. A sole trader has unlimited liability
meaning that the owner is personally
responsible for all the debts of the business
Partnership
A partnership is a business owned by 2-20
people (there are exceptions to this number
in Australia).
-
Steve Jobs, Steve Wozniak, and
Ronald Wayne
Invented Apple
-
Law firms
-
Physician groups
They have the same legal liabilities as sole
traders (unlimited liability), and silent
partners provide financial backing to the
company, however, do not have influence on
how the company is run.
Private listed Company
Private limited companies must have at least
one shareholder and a maximum of 50
shareholders.
-
Cotton on
-
Linfox
The business decides who can buy the
shares and these businesses are often
followed by 'Pty ltd'. Private limited
companies also have limited liability
meaning that the shareholders in a company
will not be held personally for the debts of
that business.
Public Listed Company
An incorporated business structure with a
minimum or one shareholder (and no
maximum).
-
Testra
-
Woolworths
-
Virgin Australia
-
Westpac
Shares for these companies can be bought
by anyone through the Australian Securities'
Exchange. These companies are the large
scale organization's with a large range of
products and have the word 'Limited' or
'Ltd' in its name
Social Enterprise
A business that produces goods and services
but operates to improve society in some
way.
-
Salvation army
All profits made are reinvested back into the
company to continue improving the social
need. They act like a for profit business (as
the more money they make the more
services they can provide) and do not rely
on donations.
GBE
(Government Business Enterprise)
A type of business that is government
owned and operated.
-
AusPost
-
VicRoads
All profits go to the government or
reinvested back into the service (unlike
