Creating, Financing, and Marketing a Business



Creating, Financing, and Marketing a Business

Introduction

Before creating any business, for an owner it is significant to know the total creation of a business. Therefore, in this paper we are going to focus on the total creation of a business. Initially we shall be looking at pros and cons of partnership as a form of ownership. After that we shall be reviewing different type of funding options available to a businessman for a small business. In addition we shall describe how managerial accounting can help with budgeting and cost incremental analysis of business. In the end; we will assess marketing strategy and role of technology and social responsibility in marketing. The purpose of this paper is to let readers know that entrepreneurs can carry out high growth innovative company with this basic knowledge. Partnership: Pro and Cons

The most important decision an individual make is how to form his/her company. The most obvious choice to form a business is through partnership, but like everything partnership as a form of ownership come with its pros and cons. A partnership is formed when two or more than two people engage in business activity, share profit, investments, and losses.

Pros

Partnership relatively is ease to form. Two or more than two people can form partnership with the help of just one agreement. Partnership can be formed with verbal agreement but it is not much recommended. The startup cost for an individual is low when compared to other forms of ownership. Business has stronger financial ground because two or more people invest the company's capital. In partnership responsibilities of running business are divided between the owners. Shared responsibility eases workload on a person and lead to increased productivity (Mike, 2004). One of the main attractions of partnership is tax treatment. Partners are only taxed on the basic of personal income for example how much loss and profit a partner endured.

Cons

One main disadvantage of this form is unlimited liability. All partners are equally responsible for the lawsuits and debts. Once an individual has operated a business as a partnership, he/she is not free to walk away and start up his/her own business. Sometime, it becomes difficult to make decision because of partner's different views.

Funding Options

In order to start a new business finding funds is the most important activity. Whether it is personal fund, asset, or equity, the money must come from somewhere. There are various funding options available to an individual. The most common and easy funding option is to use own funds of the owner. Several owners start up with loans. If businessmen have good credit limit and established with bank, they can get small business loan. Owners can also get the help of federal small business administration (SBA), it help owners with securing financing which includes SBA guaranteed loans. Owners can fund their business by selling shares of their business, this option cannot be used when starting a business but it can be used when entrepreneurs think ...