1. Forms of Business Ownership
March 6, 20013

2. Business Ownership What are some benefits to owning your own business?
Major forms of business ownership are:
Proprietorship
Partnership
Corporation

3. Proprietorship A business owned and run by just one person
Easiest form of business to start and end
Few legal requirements
Gives owners control over business decisions
Owner receives all profits, BUT is responsible for all debts
If business fails, owner has no shelter from creditors. What does that mean?

4. In Your notes…..
Proprietorships tend to have a high failure rate…..why do you think this is true?
So easy to open! People usually start a business without much thought or planning. He/She is not always prepared for the challenges that will be faced.

5. Partnership Owned and controlled by two or more people
Partners enter into an agreement
Also quick and easy to start
Share investments and profits
If business fails, both partners are on the line for debts

6. In your notes….
Effective partners often compliment each other. One usually offers skills and abilities the other does not possess. Identify skills and abilities you might look for in a partner. Choose ones that will compliment your own.

7. Corporation
Separate legal entity formed by documents file with the state
Owned by one or more shareholders
Managed by a board of directors
More difficult to form, must meet more legal requirements
Not all owners have a say in business functions
Don’t have access to profits without board of director’s approval

8. In your notes…..
Try not to look; see if you can quickly list the differences between the three main forms of business ownership.

9. With your neighbor….
Identify problems that can arise if a business attempts to change its’ form of business ownership. Create a quick list.

10. Computer Work… Please go to this website: www.sba.gov
Go to the “Starting and Managing” tab
Click on “Thinking about starting”
Read at least two articles from this section. Take notes on the articles and write down the names of the ones you read
We will discuss in class