Starting and Naming a Business
BUSI 561, Legal Issues in Business
Liberty University
Starting & Naming a Business
Betty Wilson’s venture of opening a Christian Coffee House in Belmont, NC, presents her with abundant opportunities in selecting a business form. She is considering the following types of entities: 1) franchise, 2) sole proprietorship, 3) partnership of some sort, 4) corporation of some sort, 5) LLC, or 6) even as a joint venture. We will briefly explore each business option and give Betty concise recommendations as to what business form to pursue as well as what business partners to engage.
Franchise
A franchise is a legal agreement between franchisers and franchisees that consents use of the franchise’s trademark and trade name or marketing plan to sell products or services (Kubasek, Brennan, & Browne, 2012, p. 791). Through a franchising arrangement franchisee can profit from implementing another’s efficacious business model. One of the most attractive advantages is the high probability of success of 90 % as compared to 20 % for small businesses (Staring and Naming a Business Presentation, 2012, Slide 9). Other advantages include established franchise reputation, operational support and training, product research and development, and better access to financing. On the downside, business plan rigidity can deprive the quality of customer service and hinder a creative business owner. Thus, both the Clayton Act regulates business competition and price discrimination (15 USC §§ 12-27; 36 Am J1st Monop etc §§ 141, 142) and the Sherman Act is a federal antitrust act (15 USC §§ 1 et seq; 36 Am J1st Monop etc. § 141) protect the public and small business owners from monopolization and market power.
Sole Proprietorship Sole proprietors own an unincorporated business on their own and this type of business constitutes the most predominant form of business enterprise in the United States (Kubasek, et al., 2012, p. 758). Advantages of a sole proprietor include complete
Liberty University
Starting & Naming a Business
Betty Wilson’s venture of opening a Christian Coffee House in Belmont, NC, presents her with abundant opportunities in selecting a business form. She is considering the following types of entities: 1) franchise, 2) sole proprietorship, 3) partnership of some sort, 4) corporation of some sort, 5) LLC, or 6) even as a joint venture. We will briefly explore each business option and give Betty concise recommendations as to what business form to pursue as well as what business partners to engage.
Franchise
A franchise is a legal agreement between franchisers and franchisees that consents use of the franchise’s trademark and trade name or marketing plan to sell products or services (Kubasek, Brennan, & Browne, 2012, p. 791). Through a franchising arrangement franchisee can profit from implementing another’s efficacious business model. One of the most attractive advantages is the high probability of success of 90 % as compared to 20 % for small businesses (Staring and Naming a Business Presentation, 2012, Slide 9). Other advantages include established franchise reputation, operational support and training, product research and development, and better access to financing. On the downside, business plan rigidity can deprive the quality of customer service and hinder a creative business owner. Thus, both the Clayton Act regulates business competition and price discrimination (15 USC §§ 12-27; 36 Am J1st Monop etc §§ 141, 142) and the Sherman Act is a federal antitrust act (15 USC §§ 1 et seq; 36 Am J1st Monop etc. § 141) protect the public and small business owners from monopolization and market power.
Sole Proprietorship Sole proprietors own an unincorporated business on their own and this type of business constitutes the most predominant form of business enterprise in the United States (Kubasek, et al., 2012, p. 758). Advantages of a sole proprietor include complete
References: Clayton Act (15 USC §§ 12-27). Corporations Division for Department of the Secretary of State North Carolina (2012). Retrieved from http://www.secretary.state.nc.us/corporations/searchresults.aspx?onlyactive=OFF&Words=ALL&searchstr=gathering%20place Delaware Limited Liability Company Act (C § 18-1101(b). General Corporation Law (Corp C §§100-2319). Kubasek, N. K., Brennan, B. A. & Browne, M. N. (2012). The legal environment of business: A critical thinking approach (6th ed.). Upper Saddle River, NJ: Prentice Hall. Liberty University (2012, Spring). Staring and naming a business. Legal Issues in Business class presentation. Retrieved from http://bb7.liberty.edu/bbcswebdav/pid-15354309-dt-content-rid-74512567_1/courses/BUSI561_D10_201220/presentations/Module%207/index.html Small Business and Work Opportunity Tax Act of 2007 (Public Law 110-28). Uniform Partnership Act of North Carolina (§§ 59-31).