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Once you
have been successful in setting up your entire business next
step to start your business is choosing the right business
strategy for you. It is up to your business that whether you
want to work alone or have a business partner.
If
you choose to have a joint business then before you select a
business partner for yourself, you must talk and take advice
from a good lawyer and an accountant. This will help you to know
various aspects and also the demerits of having joint ventures.
There
are certain factors that help you distinguish between the
business types you choose.
- Having a business alone- It is a type
in which the whole business is undertook by a single man. He
is the one to check all the profits and loss of the
business. It is the sole proprietor who is responsible for
all the activities taking place in his business. All the
profits generated are not divided but all of it goes to that
single man. It is the most simple and small form of business
for the ones who are in true need of income.
- Partnership- As the name suggests it
is not working alone. Your business is owned by two or more
people. All the shares of business must be legally decided
and the resolutions, profits sharing ad other important
aspects must be clearly understood by the partners.
- General Partnership-In this business
there are two or more partners who are responsible for the
profits, management, liabilities, losses and importantly
running the business. It creates more profit as the business
is under taken by more than one resource, there are many
minds working behind the development of the business. All
the partnership must be legally notified. There must be
provisions for the partners if any case they don’t want to
continue their partnership. Benefits of such partnership are
that it requires less capital, less paper work and fewer
formalities.
- Limited partnership- In such a type
there are only limited rights given to the partners to
access. It is a complex form of a business as compared to
general partnership. This business type is good for
short-term projects. However this type of partnership is not
commonly used to run a real business.
- Joint-ventures- This is a similar
business type to the general partnership. But only one
difference is that in this type the partnership is
determined for a specific period of time and for a specific
business project.
- Corporation- It is a huge group of
businessmen coming together. They can be taxed or they can
enter into various contracts. It does not change even if the
partners change. It has its own span.
As we see different types
of factors related to partnership it is essential for us to look
for its merits and demerits. Benefit of general partnership is a
small concept. It does not require permissions from state. It’s
seen just within the partners. The corporations seek permission
and allowance from the government and state organizations. The
distribution pattern of corporation is easy than the other forms
of partnership.
There are chances of disputes between the partners and thus it
affects their business. Partners sometimes feel relaxed as they
are in wrong impression that other person will take care of the
responsibilities and management. Often this causes ruining of
the business.
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