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Thursday, September 29, 2016

Forms of Business Ownership

I graduated from one of private universities in Bandung in the Faculty of Languages - major of English. Actually, my faculty has two disciplines (office and tourism) that offered to all of the English students. I'm interested in business, so I took office major. There, I studied so many subjects such as public relation, office business management, English for business, and all kind of office stuff.

I'm not an expert, but let me explain the forms of business ownership:
Sole Proprietorship
It is a business owned by individual. There're so many people deal with this business. The business advantages such being easy to set up and to dissolve because there's only a few laws exist to regulate them. Proprietors as the owners maintain direct control of their businesses and they own all the profits. On the other hand, owners of proprietorships are responsible for all business debts and they are constrained by the limits of their personal financial resources. Those could be difficult to expand or increase their profits. Sole proprietorships tend to be small, retail businesses,  and primarily service.

It is an association of two/more people who run and operate a business as co-owners. There are usually different types of partners. One of them is active in the operation of a business and liable for all of its debts. The owners in small businesses typically will be general partners. A limited partner will invests in a business but not involved in its operations. Partnerships, like sole proprietorship is relatively easy to establish. Furthermore, partners can gather financial resources to fund expansion and can divide their duties and responsibilities according to personal expertise and abilities. One partner may be very good at selling, while another has a knack for maintaining good financial records, however, partnerships may entail substantial financial risks, as all of the general partners are obliged to the debts of the business. And unlike proprietorships, disagreements among partners can harm partnership businesses.

Joint Ventures and Syndicates
It it an individuals businesses cooperate to create a single product or service package. A joint venture is a partnership agreement, join together to carry out a business project. A syndicate is an association of corporations or individuals  that formed to conduct a specific financial transaction such as buying a business.

A corporation can continue indefinitely through complete changes of ownership, leadership, and staffing. Current owners can sell their holdings to other individuals or, if they die, have their assets transferred to heirs. This is possible because a corporation creates shares of stock that are sold to investors. One strength of the corporate business structure is that stockholders have limited liability, as opposed to the unlimited liability of general partners, so they cannot lose more than their initial investment. Investors may also easily buy and sell stocks of public corporations through stock exchanges. By offering stock publicly, a corporation enables anyone with some money to buy the stock and become a part-owner of the company. As a result, corporations can more easily raise capital for business expansion than can sole proprietorships and most partnerships.

Investors control a corporation through the election of a managing body, known as a board of directors. In a large corporation, investors collectively decide who will oversee the operation of the enterprise. In turn, the board chooses a president, who decides on the key company personnel and helps formulate company strategy.

Many corporations are highly successful business organizations, with profits far exceeding those of many sole proprietorships and partnerships. However, they traditionally have higher tax burdens than other kinds of businesses. Also, the fees involved in creating and organizing a corporation can be expensive.

What about doing business in Indonesia?

Indonesia actually is not an  easy place to start a business. This is reflected in the World Bank's Doing Business, Indonesia climbed three places to rank 114th last year (in 2015). Doing business in Indonesia concerns the necessary permits and licenses which can make a time-consuming and expensive costs. One of the type of businesses that you can do in Indonesia is investment. For further info please visit http://www2.bkpm.go.id/home.


  1. Replies
    1. I hope it will be useful. Thanks for visiting.

  2. Klo saya, lbh tertarik sm tourism kayanya hihihi

    1. Wah tourism juga sekarang cakupannya luas dan banyak peluang yang terbuka. Temenku dari mulai hoteliers sampe tour guide ada juga, dan bisnis travel agency.