VCE Accounting Unit 1 Starting a small business By Wendy Zhou 1. Define a small business. A small business is a usually owned by one or two owner, these owner manage and controls the business. The business usually consists of 20 or less employees.

2. What is the difference between a sole trader and a partnership? What are two advantages and two disadvantages of a sole trader and a partnership? Sole trader is a business owned by the one owner whereas a partnership is where two or more owners own the business and the share is spread among the owners. The advantages of a partnership includes a greater amount of money being used while can help them to increase the quality of services and goods. The flexibility of having one owner and therefore it gives the other owners the chance to take time off, so that he or she won't have to worry about his or her business as there are other owner helping to look after the business, also the workload is spread. Some disadvantages included unlimited liabilities, which can cause company failure. Many disagreements concerning the running of the business.

The advantages of sole trader included the ability to make your own decisions and therefore giving you all the control and decision-making. This also limits the liabilities. Disadvantages includes the huge amount of responsibilities which the owner holds this enable the owner to have too much flexibility. 3. Expert PC Repairs Pty Ltd is a local small business that repairs computers. What do the letters Pty Ltd tell you about the business? What are two advantages and two disadvantages of starting your small business as a company? The letter Pty Ltd stands for Proprietary Limited, this means that the business is a private company.

Starting a small business have many advantages and disadvantages. Some advantages included having full control of the company with mean that your are able to make your own decisions without having to go through the whole process of having to go though lots of people before making the decision. It is also easier to start with a much lower cost. Disadvantages includes the lack of skills and experiences, a risk of failure as you have no idea if the business will be successful. 4. What is a service business? List three examples of small service businesses that you know.

A service business is where you pay and in exchange they provide you with business. Some examples of service business includes hair dressers, lawyers and electricians. 5. What is a trading business? List three examples of small trading businesses that you know. A trading business is where you pay money in exchange you receive goods. Some example of small trading business includes, milk bars, clothing shops and florist.

6. What is an e-commerce business? List three examples of e-commerce businesses that you know. An e-commerce business is where the trading is done on the internet where you pay by card and receive good. Some examples includes, Amazon. com, CDS and DVDs, also Dano z Direct. 7.

Check your knowledge - service and trading businesses. Trading: DVDs for sale on the internet, butcher, video rental, newsagent, bakery, school canteen, milk bars, mobile phone dealer, book shop. Service: lawyer, dentist, cleaning business, local bus company, gardener, doctor, tutoring, sporting coach. 8. What does starting a business from scratch mean? In your own words explain a different advantage and disadvantage. Starting a business from scratch means that you start off from nothing, you can develop the business the way you are able to develop your own image and reputation.

Advantages includes having the ability to start the business at your own pace as well, you " re also free to develop your own image as well as reputation. Disadvantages are the capability of a business failure and you have no idea if this business is going to succeed. 9. What does buying an existing business mean? In your own words explain a different advantage and disadvantage. Buying a existing business means buying a business which someone else had previously owned ran. Some advantages includes having the business in a good location as well you " re able to know how successful the business have being.

However having this could also be a disadvantage as the old customers don't really know you and are not sure if they should continue with the business. Sometimes this business may also have a bad reputation which may cause limited customers as they don't know what you " re like when running a business. 10. What does buying a franchise business mean? In your own words explain a different advantage and disadvantage. Buying a franchise means that your buying business's name as well as they method of doing things and also their reputation and images. Advantage of a franchise business includes the image the business has already set to the market and is very successful.

Not only did you pay for the business you also pay for advertisement, which means you don't have to worry about having to plan your own ads. Disadvantage is not having the rights to change what you sell and the way you do business. 11. What do you think are the main advantages of buying a McDonalds franchise? The advantages of buying a McDonalds business are the fame which McDonalds restaurants have already spread around the world everyone knows McDonalds therefore you don't have to worry about your business not succeeding due to the limited amount of people knowing what you are. By buying the McDonalds franchise you " re eligible to all the ads and promotion for the company. 12.

What do you think are the main advantages of buying a Video Ezy franchise? Buying a Video Ezy franchise allows you to have your own territory, which means that you " re the only one of the kind in this area, this will bring better business. 13. What are the benefits of owning a video rental business that you: Start from scratch: You are free to develop your own idea and management. Bought as an existing business: It's in a good location as well as knowing that the business is should be successful. Bought as a franchise: Having your own territory set for you in that area. All the ads are done for you.

14. Check your knowledge so far - Jim's Mowing What are the two advantages and disadvantages of buying a Jim's mowing franchise? Advantages: A well-known business, which gives you, the advantage of knowing that this business has very good chance of doing well. Also Jim's mowing offers new businesses training so they can receive a good start. Disadvantages: Not having the ability to sell the products that you want to sell and must depend on the what the business.

15. Why would you want to start your business on the Internet? Starting a business on the net can bring your many advantages includes the ability to advertise the business online, this helps to spread the information of your business everywhere. Not only that the cost of managing the business is also cheaper than that of other sorts of advertisements. 16.

What at steps do you need to take to set up your e-commerce business? To set up the e-commerce business first plan your business, than register a domain name, which gives you the URL of your site, chose an online service provider, set up credit card arrangements with a bank; design and publish a website and finally you must meet Australian e-commerce standards.