Business 1.2

• Private Sector: Businesses owned and run by individuals or private companies, not by the government.

• Public Sector: Organizations and services owned and operated by the government to benefit the public, like schools and hospitals.

• Sole Trader: A business owned and operated by one person who keeps all profits but is personally responsible for any losses.

• Partnership: A business owned by two or more people who share profits, losses, and decision-making.

• Publicly Held Company: A business whose shares are sold to the public and traded on stock markets.

• Privately Held Company: A business whose shares are not traded publicly and are held by a small group of people.

• For-Profit Social Enterprise: A business that aims to make money while also achieving social or environmental goals.

• Cooperative: A business owned and run by its members, who share profits and benefits equally.

• Non-Profit Social Enterprise: An organization focused on helping people or the environment without aiming to make a profit.

• Non-Governmental Organization (NGO): A non-profit group independent of governments, working on social, environmental, or humanitarian issues.

• distinguish between the private and public sectors (AO2)

Public Sector:

1. The public sector is run by the government to serve the public, like schools, hospitals, and police.

2. It is funded by taxes paid by citizens and focuses on providing services, not making a profit.

3. Decisions are made to benefit society as a whole, often focusing on fairness and accessibility.

Private Sector:

• The private sector is made up of businesses and organizations owned by individuals or companies, like shops, tech companies, and banks.

• Its goal is usually to make a profit by selling goods or services to customers.

• Decisions are driven by competition and customer demand, aiming to grow and succeed financially.

• compare and contrast the sole trader, partnership and corporation forms of ownership (AO3)

Sole Trader

• Ownership: One person owns and runs the business.

• Liability: Unlimited liability (owner is responsible for all debts).

• Control: Full control by the owner.

• Profit: Owner keeps all profits.

• Complexity: Simple to set up.

Partnership

• Ownership: Two or more people own the business.

• Liability: Unlimited liability (partners share responsibility for debts).

• Control: Shared decision-making among partners.

• Profit: Profits are shared among partners.

• Complexity: Slightly more complex due to agreements between partners.

Corporation

• Ownership: Owned by shareholders.

• Liability: Limited liability (owners only lose what they invest).

• Control: Managed by a board of directors and executives.

• Profit: Profits are distributed as dividends or reinvested.

• Complexity: More complex to set up and maintain due to regulations.

• examine different forms of for-profit and non-profit social enterprises (AO3)

For-Profit Social Enterprises

These businesses aim to make money while addressing social or environmental problems. Examples:

1. Socially Responsible Businesses: Companies sell products or services with a social goal, like TOMS shoes, which donates a pair of shoes for each pair sold.

2. Cooperatives: Businesses owned and run by a group of people for their mutual benefit, like local farmers’ markets.

3. Fair Trade Businesses: Ensure ethical production and pay fair wages, like coffee or chocolate brands certified as Fair Trade.

Non-Profit Social Enterprises

These organizations focus on solving societal issues without making profits. Examples:

1. Charities: Raise donations for causes like poverty or disaster relief, e.g., Red Cross.

2. NGOs (Non-Governmental Organizations): Address broader issues like education or health globally, e.g., World Wildlife Fund.

3. Social Advocacy Groups: Focus on creating awareness or lobbying for change, like Greenpeace for the environment.

Key Difference

• For-Profit: Earns revenue to sustain itself and may reinvest profits into its mission.

Non-Profit: Relies on donations or grants and reinvests all earnings into its cause.