Merits and Demerits of Company Form of Business


A company is a group of people working together for a particular aim. Usually, a company is a business entity, however the word company can be used to describe other groups of people – for instance, a theatre company. In this article we will discuss about the merits and demerits of company form of business.

Merits of company form of business

1. Diversity: when many people are working together, they bring diverse ideas and opinions to the table.

2. Unity: being part of a company gets people united.

3. Business opportunities: pooling finances and resources makes a company often better placed than a single individual to make good business decisions.

4. Mutual support: members of a company can all support each other in their goals.

5. Recognition: being part of a designated company gives you the recognition associated with the company’s brand image.

Demerits of Company form of business

1. Restrictions on autonomy: you need to follow the company’s rules.

2. Clashes with personal beliefs: being part of a company may involve signing up to support a company’s business ideals and these may clash with your own.

3. Inequality: some companies are divided into hierarchies, with CEOs having much more power and money than the workers ‘beneath’ them.

4. Extra costs: companies can be taxed at a higher rate than private individuals.


Companies can find creative, far reaching ways to meet their business goals. But, ordinary workers in those companies may find their position to be disadvantageous at times.

Leave A Reply

Your email address will not be published.