Partnerships
Partnerships
Agreements between two or more people to carry on a business togethe for profit. Groups must be chosen carefully.
Deed of partnership should be made: agreement on issues such as voting rights, distribution of profits, management.
Mostly common in law and accounting.
Advantages
- Specialization in different areas
- Shared decision making
- Additional capital, more finance
- Losses shared
- Greater privacy and fewer legal formalities
- Can cover for each other
Disadvantages
- Profits shared
- Bound by one man’s decision
- Cannot raise capital from selling shares
- No continuity
- Loss of decision making, slower and no independence
