The intention of this paper is to show that I have put a lot of thought and careful planning into the start-up of the Market Barn. It will hold the legal form of sole proprietor, where I am the owner. I will address the advantages it has over other legal forms. The company will have a management team as well as a board of advisory. I will also provide a list of the financials that are needed in order to get the business running and to stay open. This paper will also explain the sources of capital as well as a break-even point for the company.
Developing a plan to open a new business is hard enough, but coming up with the start-up capital is even harder. Entrepreneurs have to get creative when dealing with a financial plan. All avenues need to be explored and tapped into. However, if the Entrepreneur is savvy enough there are many ways that start-up capital can be produced. Once that is done the owner needs to have an excellent management team for support in the venture. 1. Describe the legal form of your business (proprietorship, partnership, or corporation). Sole proprietorship is the legal form for the Market Barn. As the owner, I am responsible for everything that goes right or wrong. This is the easiest structure to follow when opening a business. There is no partner only one person in charge. The business and owner become one and there is no distinction between the two. A fictitious name can be used for the business that cannot be claimed by any other business. License and permits are also necessary to run the business because it must follow city and state regulation (SBA.) Taxes for the business and owner are done together. The owner reports income and losses and expenses with a schedule C and standard form 1040, where "the bottom-line amount" from schedule C transfers to the owner’s personal tax return (SBA.) As the sole proprietor I am able to reap all of the rewards from the profits and hold all the control. However, there is a dark side to it all. As the owner if I should run into financial trouble, creditors will sue me for the damages. I am fully responsible for paying them back with my own money. 2. Justify the legal form you selected by detailing its advantages over other forms. I chose the Sole proprietorship over other legal forms of ownership because it is the most appealing to me. There are many advantages it has over partnerships and corporations. The first is that as the sole proprietor I have complete control over all of the decisions. There is no one to consult when I want to make a change. This is a relief when administrative changes need to be made and there is no push back. When it comes to partnerships and corporations, the control over the business has to be shared. Those in power make the decisions together. These results in meetings and detailed record keeping sole proprietors do not have to worry about. Unlike corporations which are very complex, sole proprietorship and partnerships are the easiest and the least expensive to form. There are very little costs for formation except for registering the business name. The only legal costs that are incurred are licenses and permits (SBA.) Also taxes are simple because the owner and the business’s taxes are done as one. The tax rates are also the lowest of all legal forms of ownership. With corporations, taxes are a nightmare. The company files its own return and is a taxable entity. It is also very costly for registering, maintaining and tax preparation (Sole Proprietorship v. Corporation.) Since this is my first business venture it is wise to start off small and when the business starts to grow I can branch out to more complex business forms such as corporations. 3. Identify the positions and describe the roles of the executive management team. As owner of my business it is going to be difficult to relinquish any type of control to
