Entrepreneurs embark on costly business ventures without first looking into the form of business that would be most suitable for them given their business experience and financial capability. Deciding on what legal form your venture is going to take will spell the difference when you experience difficulty in your business later on.
A businessman can choose from different business forms including sole or single proprietorship, partnership or a corporation. Each of these legal forms has their own advantages and disadvantages and a businessman should be well aware of their implications on his business venture.
Sole proprietorship is the easiest business venture to put up because you only have yourself to disagree with. This means you can go ahead with whatever plans you have and you can implement them anytime. It means that when your venture succeeds then you will reap all the financial rewards of your business. The sad fact is that this can also be a disadvantage since it can also mean that you will shoulder all the losses if the business fails.
A partnership will do well for business ventures that require more capital and more skills and expertise. You and your partner can concentrate on the different aspects of the business depending on your skills and talents. A partnership form of business means both you and your partner get to share your financial earnings and losses. However, there could be a problem if the business acquires debts because your creditors can run even after your personal money and not just after the capital infused into the business.
The most ideal, although complicated, type of doing business is the corporation. Incorporating your business would mean bringing in other people to the business. This would mean no decision can be reached without the agreement of the majority of the Board of Directors. The good thing about a corporation is the availability of vast financial resources for the business.
A corporation is a distinct legal entity from its incorporators and shareholders so that in case the business incurs debts, the share or stockholders will only answer for the debts depending on the shares they have in the corporation. This is called the theory of limited liability. The creditors will no longer have any right to seek payment from the personal finances of the stockholders.
A business can start as a sole proprietorship but the owner can chose to incorporate the business later as it grows. True, there are more documentation requirements for incorporating a business but the advantages of incorporating a business far outweigh the disadvantages.
Why Incorporate Your Business?
At What Point In Your Business Should You Incorporate?
If you have been doing business, and are wondering about when you should become incorporated, you should know that at any time, you can make your business official. Perhaps you are a representative for a company, and have been selling their products? Maybe you have a lawn mowing service and are worried about doing business and being incorporated? There is no special time in the business world that you should become a legal business. However, if you see that your business is taking off, and you are wanting to become a LLC or incorporated, there is no reason to put it off.
Becoming a legal business, and having a license to do business in the state you are operating in makes total sense. Especially if your business has really taken off. Being incorporated can protect you and your personal assets. If your business were to be sued, or go into debt, having that LLC at the end of your name would definitely pay off.
With the many different entities to choose from when you become incorporated, you will have some decisions to make. All of the entities offer personal protection to the owners except for one, and that is DBA, also known as Doing Business As. This entity requires that the owners are personally held responsible for all legal matters, as well as debt. However, the other entities all off coverage for the owners, or members of the business.
Whether you are just starting out in business, or have been operating under your personal name for a while, it is never too late to become incorporated. Just be sure that you understand the entities and choose the one that is best for you and your business. If you need some help choosing and understanding the entities, a business attorney will be able to help you with those.
5 Ways to Incorporate Network Marketing with Your Home-Based Business Opportunity
Many people are looking for a new business opportunity to make money at home. The Internet has made it possible to market products and services all over the world. This has created a huge potential for individuals to be involved in their own home business.
Some people work at home for themselves, providing services to others, or selling their own exclusive products. There are business opportunities in MLM, and network marketing that allow a person to earn money while selling for someone else. Either way, it depends on the ambition and dedication of the person involved. Any business can become a success with hard work and a product that is easy to sell.
Finding a Business Opportunity
Network marketing is about selling and dispersal. You want to get your product known to prospective customers and have it distributed so that it creates more sales for you. By investing a small sum of money, you can begin to make money and work from home selling your own products or products for another company.
Promote Your Business
The first and best form of advertising and marketing is word of mouth. Whenever a person finds a new product, or a new store, new doctor, or a new restaurant, they tell everyone they know about it. This stirs up interest and encourages people to try something new. If you have a product or service to sell, the ones who use it will become your best form of advertisement. Many businesses depend on this positive form of network marketing.
Secondly, to make your product known to more people, try printing business cards to hand out everywhere you go. When you go to the grocery store, church, school meetings or other everyday places, hand your cards out with a friendly smile. This will spread your name and increase your business opportunity.
Thirdly, you can promote your products through your own website or by emailing people from related websites. The Internet is also useful for marketing by submitting articles related to your products to other websites.
Fourthly, another effective network marketing tool is a send-out card. These keep you in touch with your clients and customers by using a more personal approach. Sending an email is easy and cheap but it does not seem as personal as a card addressed to them
Fifthly, network marketing is not just about making a one-time sale. You need to generate new sales and keep your customers coming back for repeat business. A business opportunity that enables you to add products or sell multiple products to your previous customers will give you a solid foundation for building a steady yearly income.
Following up on your customers will build a relationship that will develop confidence in your home business. By thanking your customers for their business and staying in touch, you show them how valuable their business is to you.
Build Your Home Business
The success of your home business will depend on your dedication and hard work. You don't have to start out with a lot of overhead expenses and huge facilities. By investing a few hours a week, you can slowly build your business and not be overwhelmed by debt. Start working today to build up your home business and enjoy fulfillment and financial security.