Business Ownership Choices †10 Mark Question Essay

hunting watch Designs was constituted five year ago by Amita Patel and her friend, Yi Ling, afterwards they both finished Art and Design courses. huntsman Designs is run as a fusion amongst the two women. There ar currently no some other partners.Amita and Yi create hand drawn designs in their studio which is located on an industrial estate. These designs ar past sent to another business where a computer is used to put the designs onto transfers.When Amita and Yi get these transfers back, they are put onto mugs and plates purchased from a separate pottery companion.huntsman Designs then sells the finished mugs and plates as souvenirs. hunting watch Designs has been qualification increased profits each year. Amita and Yi now desire to expand the business. They could increase the range of items onto which they put the transfers (eg. Mousemats), or perform all of the production processes at Orion Designs.Amita and Yi are aware of the risks involved in expanding the business. make up though they sire already invested their own property in the business, there may be a need for additional finance as well(p) as more employees.Actual QuestionAmita and Yi beat recently had a meeting with a local business advisor ab out(p) their plan for the refinement of Orion Designs.They were given three possible fillings* survival 1- stay as they are* Option 2- generate on additional partners* Option 3 debate the business into a private limited company. urge on the best option for Amita and Yi, explaining why the other options were not chosen.IntroductionAmita and Yi are two friends who scram a business that puts designs onto pottery. They are currently a partnership alone are trying to work out whether they should change the ownership type of their business in target to expand.Paragraph 1 (Analysis of Option 1 and Option 2)The business is currently a partnership so Amita and Yi both befool unlimited liability. This sum they would have to sell their pers onal assets if the business went into debt. If they took option 1 this dis good would still remain. Option 1 is low risk as they are not doing anything different but it might be uncorrectable for them to expand as they wont have any additional finance. If they know people who indispensableness to join their business then they could take on additional partners, these would have unlimited liability as well. This would bring gold into the business but these bleak partners might involve a say in running the business and it might not be what Amita and Yi want, this could lead to arguments.Paragraph 2 (Analysis of Option 3)As a private limited company, the owners of Orion Designs have the benefits of limited liability so they rout out just get the meat of money that they invested in the company. So the owners of the business would have more security. If Orion Designs want to expand and have new ranges then they provide need more money, if they become ltd they could raise the mon ey they need by having shareholders. This would be an advantage to Orion Designs. At the signification all profits go to Amita and Yi, if they were to become a private limited company they would receive less profits themselves as they would have to pay dividends to all shareholders.ConclusionAt the moment there are only two partners, Amita and Yi so they will be limited in the amount of money they can invest but they can make all the decisions themselves. If it were to become a ltd then other shareholders would be able to make decisions and Amita and Yi would lose some control of their business. There are besides legal formalities involves in becoming a ltd which would take time and cost money.In order to secure the future of the business and expand I recommend that Orion Designs takes option 2 and girdle as a partnership but invites other partners to invest in the business. This way they get the advantage of more capital in the business but do not have to spend a lot of time and money becoming an ltd.