Setting Up Business in the United States

Identify the major forms of business ownership.

     The most common forms of business ownership are the sole proprietorship, the partnership, the cooperative, and the regular corporation. Each form has several advantages and disadvantages.

Discuss sole proprietorships and partnerships and identify their advantages and disadvantages.

     Sole proprietorships, the most common business form, consist of one person doing business. While sole proprietorships offer the owner great freedom and are easy to form, they also present more financial risks. General partnerships are proprietorships with multiple owners. Limited partnerships and master limited partnerships are special forms of partnership. Partnerships have access to a larger talent and money pool than do sole proprietorships, but may be dissolved if conflicts between partners cannot be resolved.

Describe cooperatives and regular corporations and identify their advantages and disadvantages.

     Cooperatives are groups of sole proprietorships or partnerships that agree to work together for their common benefit. They give their members greater production power, greater marketing power, or both. Corporations are independent legal entities that are usually run by professional managers. In some corporations, stock is widely held by the public; in other firms, stock is held by a small, private group. The corporate form is used by most large businesses because it offers financial protection to investors, but it is a complex legal entity whose profits are subject to double taxation.

Describe the basic issues involved in creating and managing a corporation.

     Creating a corporation generally requires legal assistance to file articles of incorporation and corporate bylaws and to comply with government regulations. Managers who run a corporation must understand stock and stockholders' rights as well as the role of the board of directors.

Identify recent trends and issues in corporate ownership.

     Several recent trends in corporate ownership are mergers and acquisitions, parent and subsidiary corporations, multinational corporations, joint ventures (strategic alliances), employee&-owned corporations (ESOPs), and institutional ownership of corporations.

Trace the history of business in the United States Modern U.S. business structures reflect a pattern of development over  centuries.

     Throughout much of the colonial period in U.S. history, sole proprietors supplied raw materials to English manufacturers. The, rise of the factory system during the Industrial Revolution in the 1700s brought with it mass production and specialization of labor. During the entrepreneur era in the nineteenth century, some key businessmen built giant monopolies. During the production era of the early twentieth century, companies grew by emphasizing output and production. During the sales and marketing ears of the mid&-1900s, businesses began focusing on sales staff, advertising, and the need to produce what consumers want. The most recent development has been toward a global perspective. The global era promises to be a major challenge for managers throughout the 1990s.