Isuggest partnership as the most suitable ownership for their new business.

Followingdifferences between strengths and weakness of partnership and limited companywill be prove that partnership is the best option for Mr. Fernando and Mr.Perera for their new business. A partnership is commonly a business structurethat formed by two or more people who expect to form business together.Sometimes partnership can be begins within two or more people who have a commonbusiness idea and skills that they aim to make a successful business. In some situationspartnership will be the most logical option. Compare to other businessstructure it will be a good choice of legal structure to carry on a smallbusiness with a low turnover.

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Themost important thing is partners can share their profits, liabilities anddecision making among their partners. In a partnership partners will collectfunds by their initial capital. They can collect more money by more partnersand it will help to the business growth and the flexibility of the business. Italso means more profits which will equally share between partners. In apartnership partners can share their responsibilities according to theirskills. It will help to achieve successful outcomes from the business.

Morepartners means more ideas for solving problems and can help each other whenthey need. Other important thing is this kind of business can easily form,manage and maintain. There are less regulations than companies and partners cancontinue their business under agreements of partners without any interferenceby shareholders like limited company.Thuswe can point out many strength exist within partnership. Likewise strengths,there are some weaknesses that partners can be face during their businessactivities. As partners it is necessary to agree with things that are beingdone in such a situation and there are less freedom to take decisions as anindividual, otherwise it leads to disagreements between partners and also eachpartner liable for actions by other partners.

Last one is unlimited liabilitieswhich bare by partners (Example: Financial risk).    Limitedcompany is a company whose liability is limited. The main strength of thelimited company is the financial security. Shareholders are the only people wholiable for debt. This reason will give a comfortable condition to the investorsin the company. When consider about the weaknesses of limited company startupcost is comparatively high than the partnership. And also there are complexrules in accounts than partnership.

In limited companies’ shareholders can’traise the capital by sale of shares. Sometimes disputes will arise betweendirector and shareholder as their ideas of what is best for the companyvary.   Whenconsider about the above mentioned strengths and weakness of partnership andlimited company it seems like it is better to form the new business aspartnership. Well formation according to the procedures and rules of suggestedbusiness structure will give successful outcome to those two partners withoutany doubt.