Explain how sole traders, partnerships, private limited companies, public limited companies and not-for-profit organisations differ.

Direct answer

A partnership allows quick decision‑making and shared expertise, but partners share unlimited liability and profits are divided. A private limited company limits liability to the amount invested, offers easier access to bank loans, and can attract investors, but it requires more regulatory compliance and profit distribution is governed by shareholding. For a small manufacturer, a partnership may be suitable for initial growth due to lower costs, but a private limited company becomes advantageous when expansion requires significant capital and risk protection.

How it works

The answer compares decision speed, liability, capital access, regulatory burden, and profit distribution, showing how each factor influences the choice for a growing manufacturer.