2. Choose your form of ownership!

3. ADVANTAGES  You get all the earnings  Only taxed once a year on your personal income DISADVANTAGES  You have to put in all the capital  Can borrow less because lenders look at your assets only as collateral for a loan  You are liable for debts/losses of the business (if you are sued by an employee and lose, you’ll have to pay for your own pocket)

4. ADVANTAGES  Get more capital as partners contribute money  You can borrow more because all partners assets are considered as collateral  You are taxed only once on your personal income tax return DISADVANTAGES  You only get a share of the business’ earnings  You are personally liable for debts/losses of the business

5. ADVANTAGES  You can raise money through the sale of stock  You are NOT personally liable for any debts/losses of the corporation DISADVANTAGES  You only receive a portion of the business’ earnings (based on how much stock you retain)  Earnings are taxed twice, once on a business tax return and again on your personal tax return as the business distributes cash to you in the form of dividends

6. Location of your business!

7.  All goods must arrive at customers by 12:00 noon on the day after the order is placed or they will be returned to the customer. Therefore, you want to locate your business near customers so that your trucks can get to them on-time. Rents vary and should be considered in your choice of location.

9.  Order Processor: This person inputs orders from your customer so that they can be picked and shipped. If you have only one Order Processor and he/she is absent, orders will be delayed a full day guaranteeing they will be late to customers and, therefore, returned.  Accounts Receivable Specialist (AR Specialist): This person collects money from your customers. Some customers pay nicely, others will not pay unless they are contacted by your AR Specialist. If you do not have good AR people, you will often not get paid.

10.  Accounts Payable Specialist (AP Specialist): This person pays your suppliers for the goods you buy. If you do not have an AP Specialist, your suppliers will not get paid and will stop shipping your goods.  Purchasing: This person buys goods from your suppliers and negotiates discounts on those purchases. If you do not have a Purchasing person, you will not have any goods to sell to your customers.  System Administrator: This person maintains and fixes your four computer systems. You have an order processing system, an accounts receivable system, an accounts payable system, and a purchasing system.

11.  Unloader: This person uses a forklift to bring in bulk boxes arriving from suppliers and brings them to the appropriate shelves.  Picker: This person gets a processed order, picks the ordered items off the shelves and puts them into a blue shipping container. A good Picker can pick orders faster than a bad Picker.  Loader: This person takes filled blue shipping containers and places them on the correct truck for delivery.

13.  Some order much more than others and each has a preference for which products they will favor when they order.  This can effect how much shelf space you need to allocate to a product.  As soon as you add a customer, you will want to add a truck and set the truck’s route to go to that customer. Customers’ orders will start coming each morning. Watch carefully how the orders flow through your business and are filled for the customer.  Eventually you may want to add a second or third warehouse. You can transfer employees from one to another.

15.  Employees can become unhappy for two reasons: being overworked and/or underpaid.  Employees feel overworked when you have two few people doing the job they are assigned to do. Add workers to remedy the problem. Employees feel underpaid, if over time, you fail to give them raises.

17.  Warehouse fires (loss of computers)  Truck accidents  Law suits – if you fire an employee without giving two warnings, the employee may choose to sue you for wrongful termination, forcing you a costly settlement.  You can insure against both surprises by using the Risk Management screen.

19.  You have no competitors and there are 10 customers in the area.  Your goal is $500,000 in Personal Wealth.

20.  In Level 2, if two-thirds of your employees become unhappy with their pay, they will strike. You must either negotiate better pay for them or hire all new employees.  Two competitors enter the market but 10 potential customers are added as well. The competitors aggressively bid for the business of new customers and hire away your employees if they are unhappy.  Your goal is $1,000,000 in Personal Wealth.

21.  In Level 3, construction can occur that disrupts the routes for your trucks causing them to be late in their deliveries. You’ll need to re-route them, add more trucks, or even move your warehouse.  Four additional competitors are added but, again, 10 new customers enter the region.