Marketing

Abstract

This paper discusses the different form of partnerships, the importance of small businesses in economy and their funding options. Further, the paper examines the use of managerial accounting in determining the product cost, incremental analysis and budgeting. The basic components of marketing process are illustrated with example. Lastly, the significant role of technology and social responsibility in marketing function as been discussed.

Marketing

Pros and cons of the partnership as a form of ownership

The key decision for an entrepreneur is to define the type of ownership. Strategic thinking and planning is required to make such decision. Partnership is conducting business with two or more individuals who share same responsibility. Many individuals choose partnership as a form of ownership. It is not necessary that each partner may be active in business; they can have limited role also (Pride et.al, 2012).

General Partnership

Pros

Cons

A general partner assumes full or shared responsibility of business activities.

Financial commitments are shared in general partnership.

The general partners are liable for all the debts incurred by other partner with or without his knowledge.

If any general partner wants to withdraw from the business, they have to give notices to creditors, customers and supplier which state that he is not liable to them anymore

Limited Partnership

Pros

Cons

Limited partner is not liable for any looses in the business.

Limited partners receive the portion of profits and dividends.

A formal declaration is filed with the secretary of state, which provides the detail of partnership.

General partner is responsible for all the debts of limited partner.

LP has no authority over the management responsibility.

General partner is accountable for the losses in business.

Master Limited Partnership

Pros

Cons

Owned and managed like a corporation.

The profits earned are reported as personal income which avoids double taxation (Pride et.al, 2012).

Business owner units can be sold to any other investor for capital purposes.

Each has to pay taxes on the share of taxable income.

Funding options for small businesses

Entrepreneurs require funding for small and start up businesses. Entrepreneurship is the willingness to develop, organize and manage business activities along with risks in order to generate a profit. In US, entrepreneurship is regarded as one of the most important economic activity (http://www.sba.gov). The entrepreneurs help the stabilizing the economy, increasing the trade, creating employment opportunities, distributing the wealth, increasing living standards and increase the per capita income.

The funding options for small businesses include:

Angel investors: These may include family, friends, relatives or venture capitalist. They provide funds for small business from their own money and have no or limited control over business.

SBA Loans: Small business administration loans are provided by the US government. These funding are made through loan programs, bonding or venture capital programs. The SBA loans require lower down payments. SBA doesn't lend money directly to small businesses but act as a guarantor for network of local lending partners (http://www.sba.gov).

Personal savings: The funding from one's own saving account. The advantage of this option is that it saves the interest amount that has to be paid.

Commercial bank loans: They offer loans to small business and are willing to look beyond the credit ...