Topics covered: Sole trader and Partnership
• Meaning
• Unlimited liability.
• Staring up a new business and challenges.
Joe and Lawrence recently completed their design management graduate course. During their internship with The Institute of Design Management (TIDM), they have realised that, product design plays a crucial role in the success of any business. Joe and Lawrence, consulted a private business consultant to clarify the following:
• The form of business (sole trader, partnership, private company, franchise, etc.), and procedures involved in the registration of business name and form.
• Financial requirements and sources.
• Target audience and their size.
• Competition.
• The number of employees needed.
• Business tax implications.
After due consultation, Jo and Lawrence have decided to start ‘Joe Law Design Consultancy
(JLDC), a partnership firm, with a tagline ‘Your Product, Our Design’.
Questions:
a) Define the term ‘partnership’ [2 marks]
b) With reference JLDC, explain the term ‘unlimited liability’ [2 marks]
c) Explain two differences between ‘sole trader’ and ‘partnership’. [4 marks]
d) Explain the major steps involved in starting up a new business [4 marks]
e) Explain the major problems that Joe and Lawrence may face during their initial years of start-up. [6 marks]
