MID is a limited company often gives suppliers and customers a sense of confidence in a business. This means that
the formation of a limited company is one simple and low cost method to protect a business name.
MID required to perform lesser legal formalities as compared to a public company. It enjoys special exemptions
and privileges under the company law. Therefore, there is greater elasticity of operations in MID.
MID's are a lesser number of people to be consulted. Family members, relatives and close friends form a private
company. They can take prompt decisions.
MID is not required to publish its accounts or file several documents. Therefore, it is in a better position
than a public company to maintain business secrets.
Continuity of policy:
The same persons continue to manage the affairs of MID. Relations between them are close and continuity of
policy can be maintained.
The liability of members in MID is limited.
There is greater personal touch with employees and customers in MID. There is also greater incentive to work
hard and take initiative in the management of business due to little separation between ownership and management.