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Business Organization & Management

Special Forms of Business Ownership

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Basic Forms of Business Ownership
Special Forms of Business Ownership
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This page will provide a brief overview of the different types of special forms of business ownership including: franchises and cooperatives.

Franchises

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A franchise is the right to use a specific business's name and to sell its products or services in a give territory. The franchisor is the company that sells the rights and the franchisee is the company that buys the rights. Advantages include: a nationally recognized name, marketing assistance and lower failure rate. Disadvantages include: a large start up cost, coattail effects, and restrictions on selling the business. Examples include: Days Inn, a partnership located in Cleveland, OH, and Subway, a sole proprietorship located in Lawrenceville, NJ.   

Cooperatives

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A cooperative is a business owned and controlled by the people who use it: producers, consumers or workers, who pool their resources for mutual gain.  Members democratically control these businesses by electing a board of directors that hires professional management. Examples include: Wakefern Food and Citrus World Inc. 

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Ryan Patel
Vikas Goel