4 Advantages of a Public Limited Company

A public limited company (PLC) is a type of business entity whose shares can be publicly traded via stock exchanges, but whose liability is limited. Under a PLC, losses suffered by the investors will be limited to the amount that they have invested in the company. Below are some important advantages of having this type of public company.

More Capital

Since a public company can sell its shares to the public and anyone can invest their money, the potential capital that can be raised is larger. A sole proprietorship, or ordinary business partnership, cannot usually raise the same amount of capital without additional leverage.

Access to Finance

A public limited company can easily obtain financing to bankroll its operations. Banks and other financial institutions are more willing to extend financing to this type of company than to smaller forms of business entities.

Brand Awareness

Since this type of business is often listed in a stock exchange,people will be able to easily and quickly recognize the brand or name of the company. The more brand recognition a company has, the more business it will have.

Business Continuity

A PLC will continue to operate for as long as there is a board of directors and management staff that will take the helm of the company. In other types of companies, the business entity ceases to exist once the founding members are no longer present or if there have been changes to the company’s ownership structure.

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