Liberty University Online
BUSI561 / Legal Issues in Business
November 4, 2012
Starting and Naming a Business
Betty Wilson, whom I view as being a mature and respectable Christian, is currently thinking of starting her own company. Betty expressed that she would like to open a Christian Coffee House in her present town of Belmont, NC. Although her husband, John is opened to making a contribution of capital to her business, he is not at all interested in taking part in the company’s operation or management. Betty is unsure at this point as to whether or not she would like to take on perspective partners in her company of if she would rather take on this company as being its sole owner. She has several options that she is considering in operating her new business. Some of those options include the following: operating as a franchise, sole proprietorship, partnership of some sort, a corporation of some sort, as an LLC, and even a joint venture. She has come to me asking of my input on what I think about her possible start up of this new company. Betty thought about operating her company as a franchise. According to Merriam Webster (2012), “a franchise is when a business grants the right or license to an individual or group to market, sale or distribute that company’s goods or services in a particular territory”. A partnership is identified as an agreement between individuals of two or more to carry on a business as co-owners for profit (Kubasek, Brennan, & Brown, 2012, p. 437). Some of the advantages include shared management responsibilities and access to more financial resources. The disadvantages are unlimited liability for general partners and disagreements. A corporation is a legal entity that is formed by state law to raise capital by issuing stock to investors. Corporations have several owners, but by law it acts as a single and legal person (Kubasek, Brennan, &...