Understanding business

PSHE

1. Understanding Business You And The World Of Work

2. Different types of business Businesses vary in size from small business owned and run by one person to large national and multinational companies employing tens of thousands of people in many different companies.

3. Multinational Companies

4. Working for yourself (Sole Proprietorship)

5. Working for yourself (Sole Proprietorship) It can be difficult to raise the money to start the business. Banks are less keen to lend money to sole proprietors. This is because of the high rate of failure. Of each three mew businesses started each year, two will fail. It is very easy to lose all of your money. This is known as going bankrupt .

6. Working for yourself (Sole Proprietorship) If your business goes bankrupt, you are personally responsible for all the money owed to other people. This money is known as debts . You may have to sell your car and even your house if, as a sole trader, your business is bankrupt. Sole traders are very common in the service industries. Examples include shopkeepers, writers and hairdressers.

7. Partnerships

8. Partnerships Because more than one person is involved, it is easier to raise money for this type of business and to share the work and responsibility. However, if the business fails, all the partners must pay off the debts. One advantage of working in a partnership is that different people can provide different skills. For example, Trevor worked on his own as a plumber and his sister Shereen worked as an electrician. They formed a partnership with their friend Amrit, a carpenter, to do household maintenance work. They called themselves Household Solutions.

9. Working for a company Working for a company removes a lot of risk. You will be paid a salary by the company, and usually will not receive a share of the profits. This is how many people work all over the world. However, your salary will usually be fixed. This means that even if the company is very successful, you will still receive the same amount of money.

10. Working in the public, private or voluntary sector If you own a company or work for a private company, this is known as working in the private sector . The rewards in the private sector are large, but the risks are the greatest.

11. Working in the public, private or voluntary sector Alternately, you may work for the Government, for example as a nurse, doctor or teacher. This is known as working in the public sector. Public sector wages tend to be lower than in the private sector. However, the risks are lower, as the government is always going to need staff for public services, for example, in hospitals and in schools.

12. Working in the public, private or voluntary sector A third option is working in the voluntary sector. This can involve working as a volunteer or as a paid member of staff, for some sort of charity. For example, Tina worked as a nurse until she retired. Now she works as a volunteer for Age Concern, which helps and supports older people.

13. In groups 1. On your own, list the advantages and disadvantages of: Working for yourself Working for a company Share your views in a group discussion. 2. Discuss what are the differences between working in the private sector and public sector. Which sector provides more job security? Which provides the most rewards? Which is more risky?