By Samantha Garner | July 19, 2014
From customer service to holiday sales (yes, the winter holidays!), we found some good business blog posts this week that we wanted to share with our fellow entrepreneurs:
- The Comcast Call: Why Every Single Customer Matters at Inc.
- The Apps That Help This Yoga Instructor Run Her Business from Half a World Away at Entrepreneur
- Soccer and Business: A Leader is a Leader at Small Business BC
- Preparing for Christmas in July: 8 Tips for Online Holiday Sales at Small Business Trends
By Samantha Garner | July 12, 2014
A couple of years ago, we wrote about when it was time to throw in the towel and exit your small business. It’s a reality for many entrepreneurs – no business lasts forever, and many close within a few years.
Of course, here at GoForth Institute, we want to give small business owners all the tools they’ll need to succeed in entrepreneurship, but we also know that the end of a business is a part of every entrepreneurial life cycle.
That’s why we were interested to read an article in Entrepreneur this week, Is it Time to Give In? How to Know for Sure. Here’s an excerpt:
“I really started noticing my judgment became very clouded, and I wasn’t open to people’s ideas,” says the chairman of Camping World and host of CNBC’s The Profit. “I was so caught up in my own world I couldn’t even see new ideas.”
Have a look at the article – we think it’s important for all entrepreneurs to recognize the signs of a small business in crisis, and what can be done about it.
By Samantha Garner | July 5, 2014
Cooperative small businesses are organized and controlled by members – an association of people who strive to meet common needs. There are approximately 8,800 cooperatives in Canada. If you’ve shopped at a Co-op grocery store, well, it shouldn’t surprise you to learn that it’s a cooperative organization.
Members pool resources and are given one vote per member. Membership is open and voluntary and members get regular patronage dividend payments. There are two operations of the cooperative: general meetings of the members or delegates; and the board of directors elected at a general meeting. Users or stakeholders of the cooperative usually include consumers, producers, workers or multi-stakeholders.
Here are some perks and snags of a cooperative business:
- Limited liability.
- Profit distribution in proportion to use of service.
- One member, one vote (democratic control).
- Owned and controlled by members.
- Ability to respond to community needs.
- Community development in remote areas can be stimulated as a spin-off from a cooperative activity.
- The survival rate of co-ops is higher than private sector companies.
- Life of the company doesn’t end with the death of a shareholder.
- It takes longer to make decisions.
- Record keeping requirements are extensive.
- There is less incentive to invest additional funds – members having the larger investment have no advantages over smaller contributors.
- Conflicts may develop between members.
- Members must participate for success.
Want more perks and snags? Check out our earlier blog posts on:
By Samantha Garner | June 28, 2014
In previous blog posts, we’ve discussed the perks and snags of sole proprietorships and partnerships. However, a corporation is very different from these two forms because the company is considered by law to be a unique entity, separate from the owners. The corporation can be taxed, sued, own property and can enter into contractual agreements at either the federal or provincial level.
Terms that identify a corporation include “Limited”, “Ltd.”, “Incorporated”, “Inc.”, “Corporation”, or “Corp.”
Owners of a corporation are its shareholders, who can’t be personally responsible for the corporation’s debts or obligations, and can’t claim any loss the corporation might experience. A board of directors is elected by shareholders to oversee major decisions. The corporation doesn’t dissolve when ownership changes.
Here are a few perks and snags that you may experience by incorporating your business.
Perks of incorporation
- Possible tax advantage.
- Shareholders can only be held accountable for their investment in stock of the company.
- Transferrable ownership, no limited lifetime of the company.
- Sale of stock allows for additional funds; it can be easier to raise capital.
- Specialized management – management and ownership are separate.
- Benefits may be deducted.
- Separate legal entity.
Snags of incorporation
- Most time-consuming and expensive form of organization.
- Federal and state agencies monitor corporations.
- Charter restrictions.
- Legal formalities.
- More paperwork, record keeping and filing requirements; closely regulated.
- Often higher overall taxes.
- Dividends may be taxed twice.
- Possible conflicts between shareholders and executives.
By Samantha Garner | June 21, 2014
In a partnership, two or more people combine resources to start a business. In a partnership, the law doesn’t distinguish between the business and its owners. Partnerships can be a little complicated, because there are three different types possible – general partnerships, limited partnerships, and joint ventures.
Let’s take a look at some of the perks and snags of choosing a partnership for your company’s form of organization.
Perks of small business partnerships
- Relatively easy to form.
- Relatively low start-up costs.
- Simple to start and organize.
- Partnership agreement has most legal issues covered.
- Having more than one owner may allow more access to funds.
- There may be possible tax advantages.
- It may be easy to attract employees if they’re given the incentive to become a partner.
- Limited regulation.
- Ability to benefit from complementary skills of partners and a broader management base.
Snags of small business partnerships
- Each partner may be responsible for the actions of another partner.
- Profits must be shared with other partners.
- Unlimited liability for General Partnerships (not separate by law, can be personally liable for all debts even if it means paying debts with personal assets).
- Control and authority over important decisions is shared.
- Difficulty in changing ownership.
- Disagreements among partners may occur; may take a longer time to come to a decision.
- Difficult to find suitable partners.
- Some employee benefits are not deductible from business income on tax returns.
- As a partnership, the company may have a limited life if a partner withdraws or dies.