BMGT 110-Introduction to Business and Management-Week 4 Discussion
Download and complete the Entrepreneurial Self-Assessment Survey. When completing this survey, remember that there are no right or wrong answers, and you should be as honest as possible. Once you have completed the survey, score the results using the scale found on the last page. You will need the score to respond to the following in your initial discussion post:
How did you score? Does that score indicate you have the traits of an entrepreneur or not?
Are you surprised by the score? Does it reflect how you see yourself?
Regardless of your survey score, imagine that you started a business. What would it be? What would it sell and how large would you want it to grow?
Which of these legal forms of business is best suited to your imagined business? Explain why.
Sole proprietorship
Partnership
C Corporation
S Corporation
How did you score? Does that score indicate you have the traits of an entrepreneur or not?
I scored a 75. This score indicates I have a satisfactory ability to be an entrepreneur.
2. Are you surprised by the score? Does it reflect how you see yourself?
I thought my score would be lower. I have been interested in starting a business for some time. The score does improve my confidence.
3. Regardless of your survey score, imagine that you started a business. What would it be? What would it sell and how large would you want it to grow?
I would love to create a company that sells tool bags. The right tool bag for the job is as critical as the right tool for the job. High-quality tool bags that are durable and have a great warranty would be in high demand. Ideally growing the goal would be to grow the company to a global empire.
Which of these legal forms of business is best suited to your imagined business? Explain why. Sole proprietorship, Partnership, C Corporation, S Corporation
Limited Liability Company would be my first choice. Most small businesses start as limited liability companies to protect their assets in case of a lawsuit. "Limited liability. Members are protected from personal liabilities resulting from the business decisions or actions of an LLC. This means that if an LLC incurs debt or is sued, members personal assets are usually exempt from any repercussions" (Williams and Lumen Learning). Given the four choices as a new business owner, I would choose sole proprietorship. Sole proprietorship comes with a lot of vulnerability to be sued for your personal assets. However, the upfront cost of starting a corporation and the large amounts of debt incurred during the first few years of a start-up business can be daunting, a sole proprietorship is a more desirable starting point.
As a sole proprietor, it is important to be surrounded by a great team of staff who are highly skilled. Additionally, having a certified public account is critical to the company's success. Since a sole proprietorship does not have the protection limited liability it would be crucial to acquire the proper insurance to protect personal assets.
Furthermore, sole proprietorship "gives you complete control over your company. You aren't required to consult with anyone else when you want to make changes" (Williams and Lumen Learning). There would be no unwelcomed outside influence and the company would be personalized, unique, and avoid conformity. Consider this Truett Cathy the found of Chick-fil-a would not turn over ownership of the company to his children unless they agreed to a contract to never make the company public. Cathy famously stated that "I'd be resentful if shareholders who don't know the business tried to tell me what to do," he told The New York Times in 1996" (Taylor, K). In the first few years of a new business, especially if the business is founded on certain ideas, it is important to maintain authenticity. After 5-10 years I would consider transitioning the company to an C corporation for the tax benefits and to allow everyone the opportunity to become part owner in the business as a shareholder.
References:
Williams and Lumen Learning. (n.d.b). Introduction to Business, Which Organizational Type Is Right for You? Adapted by UMUC and available under a Creative Commons Attribution 4.0 International.
Taylor, K. (2016, January 28). Why Chick-fil-A will never go public. Business Insider. https://www.businessinsider.com/chick-fil-a-will-never-go-public-2016-1
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