Partnerships
Our small business needs to consider the requirements of starting a partnership group by taking into consideration our goals and objectives in the business and where to obtain the financial requirements and planning. All members need to sign a Legal Partnership Agreement Act of 1895 in accordance with law and follow the policies in it as liability is unlimited for each partner. WE will also discuss on the amount of tax contributions that every partner should contribute (SBDC, 2015 p. 1).
In as much as there exists two types of partnership namely general and limited partnership for our enterprise we will operate under a general one because are going to participate in the daily activities. We will also be liable for all business debts and active participation of all partners. To start our business we will have to register our company’s name, location, employment status of every member and ever members’ official names given in the partnership agreement form and returned to the Secretary of State’s Office when duly filled and signed for verification (SBA n.d, p. 1). After registration, we will have to obtain a license and business permits from the local authority before we start doing our core activities for the business to run smoothly. Our business being a small one only ten members are required as this is manageable and easy to coordinate.
Advantages that we will have over our firm includes. First, it is easy to start and less expensive, the few members available makes easier to begin as more concentration will be revising the partnership, procedural agreement act and following the rules to avoid its termination before the operation period ends. Another reason is that all financial commitments are shared equally among the members as we will be working towards achieving a common goal which is profit maximization. Thirdly is complementary skills applied by everyone to perform a given task through this group members will specialize in the section with which he or she can put all the skills to achieve a quality outcome of our products and sell them to the customers. Creating a competitive advantage in the market.
Some of the disadvantages are one if losses are incurred all the members will share the liability equally, and our assets used to settle the pending debts available with or without our acceptability. Secondly, is disagreement among the group partners in terms efforts when a meeting is held leading to slow decision making. Lastly, if one of our partners will want to resign from the group it will have to be dissolved and a new one formed with the present members who are another burden to the company and requires a lot of time to restructure (Adrian, 2010 p. 1).
In conclusion, for any new business formation of a partnership is best as capital will be easy to raise through the contribution of every member. Further, if we have a good contribution, banks can also offer us emergency loans payable within one year to help us start our business payable with interest. When we work together as a team realization of our achievements will be easy as our target in the firm will be to satisfy our customers and be the best company producing food stuff in the town market through our quality goods and efforts to reach our target as a partnership.
References
Adrian. 2010. Advantages and Disadvantages of Partnership. 1 March. [online]. Available at: < http://blog.thecompanywarehouse.co.uk/2010/03/01/advantages-and-disadvantages-of- partnership> [accessed 10 April, 2015]
Small Business Administration (SBA) (n.d). Starting and Managing. [online]. Available at: <https://www.sba.gov/starting-business/choose-your-business-structure/partnership>
Small Business Development Corporation (SBDC). 2015. Partnership. [online]. Available at: <https://www.smallbusiness.wa.gov.au/business-topics/planning- structures/business- structures/partnership/> [accessed 10 April 2016]
