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Business Models
Ownership and Control of your Business
Private sector business represents that part of the economy that is not owned or
controlled by any level of the government.
It is all about individuals owning and controlling the factors of production for the
purpose of making a profit.
Sole Proprietorship
Set up, owned and operated by one person
Licence and registration required by the municipality
PST and GST numbers required for tax collection and submission
Unlimited liability (owner pays to settle any lawsuits)
Business can access only as much capital as the owner is worth
Business operates as long as the owner decides
Examples
Retail store, catering business, tutoring service, product manufacturer or yoga studio
The Village Diner
Al’s Auto Service
Richi Milk
Eastend Yoga
Partnership
Set up, owned and operated by two or more people
People share the work
Important for partners to be compatible
General Partnership, all partners have unlimited liability
Limited Partnership, one partner is not responsible for the risk or negligence of
another partner
Examples
Limited Liability Partnerships are often used by lawyers, accountants and physicians
General Liability Partnerships focus on regular businesses where people want to work
and own a business together
Contracting
Franchise purchased
Corporation
Establishes a new legal entity or “person”
Set up to make profits for the owners or shareholders
Managed by directors chosen by the shareholders
Shareholders have limited liability
No one can be sued personally
Shareholders can only lose the amount they have invested
Greater ability to raise more capital through the sale of more shares
Examples
Petro-Canada
Canadian Tire
Loblaws
Research in Motion (RIM Blackberry
Co-operative
Jointly owned by members who use the service
Must be incorporated
Members have limited liability
Consumer co-ops provide goods and services to consumers
Producer co-ops provide goods and services to producers
In Canada, there are over 8800 co-ops employing 250 000 people
Examples
Alterna Savings
Sandhills Credit Union
Gay Lea Foods
Co-operative Housing Federation of Canada
Crown Corporation
Owned by the government rather than shareholders
Purpose is not profit, but to serve a public interest
Can provide a good or service not provided by the private sector
Helps to ensure public control of sensitive industries
Examples
VIA Rail
Export Development Canada
Atomic Energy of Canada
Ontario Hydro
Canadian Broadcasting Corporation (CBC)