There are many things to think about before going self-employed, but one of the most important is the kind of business you’ll run. There are many different business formats to pick from, so you must conduct research.
Calum Melville is one well-known Scottish businessman, entrepreneur, property developer, innovator, and investor, who is quite passionate about business and entrepreneurship.
He loves sharing different business ideas and communicating with people who are also equally motivated.
In the UK, there are a few standard types of companies that you can come across:
- Public limited company
- Private company limited by guarantee
- Private company limited by shares
- Private unlimited company
- Special types of limited company
- Community interest company
- Right to manage company
- Societas Europaea
There are also a few specific types of non-standard companies that exist in the UK. Articles of association and shareholder agreements are required documents for new corporations.
Learn why and when to utilise a shareholders agreement as well as how to avoid conflicts between one and the company’s articles of incorporation.
Few other business structures
There are many other types of business that also exist in the UK, and some of them must still be registered as any one of the following 3 business structures as mentioned below.
Franchise
This is a well-known business, like McDonald’s, KFC, or Hertz, run by a franchisee, but owned by a certain franchisor.
The franchisor allows the franchisee the right for using their business model in exchange for an ongoing fee. There is typically less work to be done, fewer start-up costs, easier access to business financing, and pre-existing connections with vendors, distributors, and marketers.
Large ongoing costs, however, limit franchisees’ long-term profitability, cheaper operational techniques cannot be used without the franchisor’s approval, and any unfavourable action taken by a fellow franchisee may harm the business.
Freelancer/consultant
These people are qualified to charge businesses for their services because they possess the necessary training, expertise, and experience. The most popular performing arts positions for freelancing or consulting are those of an actor, dancer, or musician.
Media careers, including those in writing, photography, magazine journalism, and broadcast journalism.
Other well-liked freelancing roles are as following:
- Barrister
- Web designer
- Acupuncturist
- Osteopath
- Fine artist
- Translator
- Graphic designer
- Textile designer
- Interior designer
Social enterprise
This kind of company must transparently reinvest profits in order to accomplish its goals because it operates to help community or the environment.
According to a recent government estimate, there are about 471,000 social companies in the UK, which employ nearly 1.44 million people and contribute £60 billion to the country’s economy.
There are many kinds of social enterprise, and a few of the most notably are:
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- Credit unions
- Cooperatives
- Employee-owned businesses
- Development trusts
- Housing associations
Charity
A charity itself cannot be categorised as a social enterprise, but its commercial division can. This is due to the fact that it is different in that money is obtained from grants and donations as opposed to trading.
Charities are often managed by trustees who do not personally benefit from the charity and pay reduced business rates and obtain tax savings. Learn more about the sector of philanthropy and volunteer work.
