There are various types of business structures within industries, and I wanted look at them more in-depth to get an idea of how they work.
What is an industry?
An industry is defined as being a form of economic activity that concerns itself with manufacturing goods and processing raw materials.
It is also recognised as an area of commercial enterprise such as the GAVI industry.
What is the GAVI?
The GAVI is an abbreviation for the ‘Games, Animation and VFX Industry’.
Types of Businesses:
Sole Trader: This is someone who is the single owner of a business, this means that they get to decide where the business will go and who to employ. They are entitled to all profits (minus tax) but are also responsible for all losses. They represent the whole company.
Limited Partnership (LP): Often referred to as ‘Limited Liability Partnership (LLP)’, this is the practice of two or more partners joining to jointly create business, and having one (or more) partners to be liable only for the amount of money they have invested into it. They are called a ‘Limited Partner’, they have direct access to the profits gained from the business and are not held responsible for the business’ losses.
Limited Company: This is a company that you set up to run your business, and is responsible for everything is does. All profits are owned by the company after tax, it then can share its profits. These types of business have members and directors. The directors are who’s running everything, and the members are people who own shares in the company.