1. Business Organization

2. Have you ever thought about starting your own business
Have you ever thought about starting your own business? If you were your own boss, what type of business could you see yourself running 5, 10 ,15 years from now?

3. Sole Proprietorship
A business owned and managed by a single individual.
75% of all businesses
6% of sales.
(67% make less than $25k).
Examples- Bike shop, barber, gardener, bakery.

4. Sole Proprietorship Positive Full control.
Start-up costs low (business license).
Relatively few regulations.
Full receiver of profits.
Taxation.
Easy to discontinue.

5. Sole Proprietorship Negative
Unlimited liability. (Need liability insurance!)
Limited capital ($) for expansion.
Lack of permanence

6. General v. Limited Partners ???
Partnerships
A business organization owned by two or more persons.
7% of all businesses.
5% of all sales.
General v. Limited Partners ???
What’s the difference??

7. Partnerships Positive Low start-up costs Shared decision making.
Specialization/complimentary qualities.
Larger pool of assets = expansion.
Taxation- income/loss pass thru to partners based upon % ownership they report on personal income tax return.

8. Partnerships
Negative
Unlimited liability.
Potential for conflict.

9. Corporations A legal entity, or being, owned stockholders.
20% of all businesses.
90% of all sales.
Examples: Wells Fargo, UPS,
Disney, Wal-Mart.

10. Corporations Positives Limited liability.
Capital investment and expansion easy w/stock offering (sell stock to public)
Stockholders do not carry responsibility for corporation’s actions.
Easy to raise money to purchase capital.
Long life.

11. Corporations Negative Difficult and expense of start-up.
Double taxation. “C Corp.”
(Corporate and Individual)
Loss of Control = Stockholders.
More regulations.

12. Corporate Hybrids
S-Corporations- is a closely held corporation, offers the owners limited liability protection. cannot be more than 100 shareholders
S corporation can be converted to a C corporation easily- if I want to go Public or issue more shares of stock. Not double taxed, income/ losses passed thru to shareholders.

13. Hybrids cont.
LLC- Limited Liability Company- These operate like a sole P or partnership but will LL. Some hoops to jump thru. LLP- Limited Liability Partnership Examples- Doctor, Lawyer, Accountant

15. Franchise
A semi-independent business that pays fees to a parent company.
The franchisee is granted the exclusive right to sell a certain product or service in a given area.
Franchisee must pay royalties to parent company.

16. Franchise Positives Built-in reputation/brand recognition.
Management and training support.
Standardized quality.
National advertising.
Buying power.

17. Franchise Negatives High franchise/royalty fees
Strict operating standards.
Purchasing restrictions.
Limited product line.
REMEMBER YOU WILL STILL NEED TO INCORPORATE YOUR END OF THE FRANCHISE.

18. Corporation Combinations
Horizontal Merger – The joining of two or more firms competing in the same market with the same good or service.

19. Vertical Merger – The joining of two or more firms involved in different stages of producing the good or service.

20. Conglomerate – The joining of companies that produce entirely different products.

21.
Searchable data base of organizations in the State of Florida
Bevs Better Burgers of Alachua- LLC
Alachua Farm and Lumber-Corp
Smoke Fried- LLC

22. Kahoot

23. Match the Characteristics
Use of Personal Savings and Investments
Board of Directors
Can Be a Hybrid
Lasts for a Fixed Period of Time (5-30 years)
Life of Partnership Limited
Documents of Disclosure
Secure Financing More Easily
Quick Start Up
Complimentary Skills
Royalty Fees
Easy to Form
Unlimited Liability
Limited Liability for Investors
Articles of Partnership
Few Government Regulations
Must Issue Stock
Articles of Incorporation
Recognizable Brand
Long Work Hours
Stricter Regulations
Needs Accurate Tax & Employee Records