Topics covered: Partnership
• Meaning
• Advantages
• Disadvantages
• Business growth
ETC is a small Indian restaurant with take away service located at Central Railway station,Bangalore. It was established in 2010 by partners Neo and Seo. ETC is run as partnership with each partner having 50 % of the stake in the business. They also have locally employed chefs,restaurant attendants, and delivery staff. ETC relies heavily on local customers and travellers who use trains.
ETC’s popularity has grown. The partners are planning to expand business. They have two ideas:
i. Admit Reo as a partner who has good knowledge in restaurant management.
ii. Borrow loan from commercial banks for expansion
Questions:
a) Define the term partnership. [2 marks]
b) Explain two advantages of running ETC as partnership [4 marks]
c) Explain two disadvantages of running ETC as partnership [4 marks]
d) Discuss advantages and disadvantages of two ideas of restaurant expansion [10 marks]
