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How to Choose the Best Legal Structure for Your Business – Pros & ConsAre you thinking about turning your latest idea into a business venture? You’ll need to do a lot of work to get off the ground. The Small Business Administration‘s 10-point checklist for budding entrepreneurs is a great place to start. It ticks off a list of crucial to-dos for anyone in the early stages of business formation:Brainstorm and write your business planLook for assistance and training in your industry or area of expertiseChoose a business location (domicile and physical location, if you’re not working out of a home office or coworking space)Find startup financing for your small businessDetermine your company’s legal structure and set up your business with Rocket LawyerRegister your business name (“Doing Business As”)Get a tax identification number and ensure you’re in compliance with local, state, and federal tax regulationsGet a business license and permits, if requiredLearn your obligations vis-a-vis hiring employees, including responsibilities under the Fair Labor Standards Act and what to do if an employee files an FLSA complaint against youFind local assistance from the SBA and local business resourcesWas I in charge at the SBA, I’d add another point: Keep looking for ways to reduce your small business expenses. That’s more of an ongoing obligation, but its importance is impossible to overstate, and it’s never too early to get started.In any event, number five on that list (determining your company’s legal structure) is crucial, with plenty of pitfalls to avoid. Let’s look at the most common business structures available to U.S.-based entrepreneurs – and a handful of less-common structures too. You’ll learn the basic attributes, advantages, and disadvantages of each structure. Afterward, you’ll be able to properly assess which option is right for you.Sole ProprietorshipA sole proprietorship (sole prop) is the simplest and least formal business structure available to U.S. business owners. By definition, it’s also the least conducive to growth. All sole props share some essential attributes:Single Owner and Operator: A sole prop is owned and operated by one person only. Sole proprietors are free to hire employees and retain contractors, but they can’t add partners or issue stock to shareholders. If you want to bring new owners into the fold or sell equity in exchange for funding, you need to reorganize it as a partnership or corporation.No Formal Incorporation: Sole proprietorships aren’t formally incorporated as corporations or organized as partnerships. Sole props that do business under a fictitious name, rather than the operator’s name, typically register those names with state authorities. (These names are known as “Doing Business As” names, or DBAs.) If your sole prop does business under your name, you don’t need to register a DBA.Tax Identification: If you’re your sole prop’s only employee, you can file taxes using your own Social Security number. If you hire employees, you’ll need to get an Employment Identification Number (EIN) from the IRS. This costs nothing and takes only a few minutes.Separate Finances: Sole prop owners aren’t legally obligated to maintain a wall of separation between their personal and business finances. However, it’s highly advisable that you do so, for multiple reasons: to determine that your business is profitable, to keep track of your income and expenses for tax purposes, and to provide potential creditors with a precise accounting of your company’s finances. Set up a business bank account and apply for a small business credit card. Route all income to the former and use the latter for business expenses only. This kills two birds with one stone: keeping your business finances separate while building credit.Pass-Through Taxation: Sole props do not file taxes separately from their operators. As the owner of a sole prop, you’ll attach Schedule C or Schedule C-EZ (Form 1040) to your personal tax return. If your enterprise was profitable during the tax year, you’ll likely be liable for self-employment tax. You’ll report self-employment income and calculate self-employment tax on Schedule SE (Form 1040). If you expect to owe more than $1,000 in tax after subtracting any withholding taxes, and if your withholding taxes comprise less than 90% of the taxes you expect to owe in the current tax year or 100% of the prior tax year’s tax obligation, you’ll need to make quarterly estimated tax payments. For more detail about this and all tax questions, consult our Tax Guide or a tax advisor.Pros of a Sole ProprietorshipSimplicity. It’s super easy to set up a sole proprietorship. You don’t need to file articles of incorporation, draft an operating agreement, or make public financial disclosures. In many cases, you don’t even need to register a company name. You should keep a precise accounting of your business finances, but that’s not legally required.No Double Taxation. Sole props are taxed on a pass-through basis, meaning your business income is combined with nonbusiness income for tax purposes. Your sole prop doesn’t pay taxes on business income that then passes through to you as taxable personal income, a circumstance known as double taxation. If you sell taxable goods or services, you may be required to register with the appropriate tax authorities and pay local and state sales tax.Cons of a Sole ProprietorshipPersonal Liability for Business Debts and Obligations. The glaring disadvantage of a sole proprietorship is the operator’s personal liability for any debts or obligations incurred by the business. For instance, if you purchase equipment on credit, then hit a rough patch, and find yourself unable to meet the vendor’s payment terms, the vendor may have the right to seize your personal assets (including your personal bank account, house, and car) to satisfy the debt. Shareholders in incorporated entities aren’t personally liable for business debts.Reticent Lenders. Unless your sole proprietorship has substantial assets to put up as collateral, it’s not likely to qualify for loans from traditional lenders. This is especially true for newer entities and owners with spotty personal credit. You may have more luck with nontraditional online lenders, many of which market to sole props and smaller corporations. The devil’s often in the details, however – these loans typically come with high-interest rates and unfavorable terms. You’re better off relying on personal savings, loans from family and friends, and other nontraditional startup financing options.Potential for Greater Tax Liability. Sole props are taxed on a pass-through basis. When they’re profitable, they increase their owners’ total taxable income. A big enough increase in your taxable income bumps you into a higher tax bracket and raises your marginal rate, reducing your take-home pay proportionally. While this sounds like a good problem to have, it’s not ideal for sole proprietors who operate their businesses for side income and rely on salaries or hourly wages for the bulk of their income. Neither is it ideal for sole prop owners who set aside substantial fractions of their business income to finance equipment, inventory, or unexpected purchases.PartnershipThink of a partnership as a multimember sole proprietorship. The Small Business Administration describes partnerships as “a single business where two or more people share ownership” and “each partner contributes to all aspects of the business, including money, property, labor or skill,” while sharing “in the profits and losses of the business.” Like sole proprietors, partners are by default personally liable for partnership debts and obligations.Like sole proprietorships, partnerships are informal. “Generally, partnerships do not require any filings with state agencies,” says Shawn Toor, a business law attorney with Seattle-based Williams Kastner. “A partnership can be formed merely by the act of two or more people agreeing to carry on business and share in the profits and ownership control.”Partnership AgreementsMost partnerships are controlled by contracts known as partnership agreements. Partnership agreements govern matters like:The partnership’s legal name and DBA nameThe partnership’s term – either time-limited or in perpetuityGeneral-purpose of the partnership – the business activities in which it’ll engageInitial contributions of each partner, such as cash and property, and the installment schedule on which those contributions will be madeProcedures for future contributions to the partnershipProcedures for admission of new partnersProcedures for distribution of profits and losses to each partner, including frequency and proportionalityManagement duties of each partnerVoting procedures – which matters require a vote and the number or proportion of votes needed to decide in favorProcedures for the sale or transfer of a partnership interest (buy-sell agreements)Procedures for the expulsion of a partnerProcedures for continuing or dissolving the partnership upon the death of a partner – often included in buy-sell agreementsProcedures for dispute resolution, such as mediation or arbitrationYou can find generic partnership agreement templates online and modify them to your partnership’s needs. However, these templates frequently leave out important eventualities that could affect your interest in the partnership – or the partnership’s very existence – going forward. For instance, a carelessly drafted partnership agreement could allow one partner to unilaterally bind the entire partnership, possibly against the other partners’ wishes.It’s therefore highly advisable to retain an attorney to draw up a customized partnership agreement on your behalf. If your budget doesn’t allow for this at the outset, revisit the situation as soon as possible. Your partner(s) should be amenable to creating a customized partnership agreement to protect their own interests.There are three main types of partnerships. You’ll designate which type of partnership you’ve chosen in the partnership agreement.General PartnershipA general partnership is the most common and straightforward type of partnership. Typically, general partners share equally in the partnership’s profits and liabilities, take on equitable duties, and have equal voting rights. The partnership agreement controls situations in which partners’ interests and duties diverge. For instance, many partnerships assign executive duties to a single managing partner. Others dole out profit shares according to seniority, with longer-serving partners taking a greater share of the entity’s net income.Limited PartnershipA limited partnership (LP), also known as a limited liability partnership, allows for a class of “limited partners” who essentially function as passive investors in the venture. Limited partners have little or no influence on the partnership’s decision-making processes and day-to-day management activities. They are not personally liable for the partnership’s debts or obligations. And they receive profit or loss shares proportional to their interest, which is usually smaller than that of general partners.LPs are more complicated than general partnerships. They are suitable for larger, capital-intensive ventures that attract lots of investors – not so much for small, two- or three-person ventures, which are easier to manage through general partnerships.On the bright side, they’re more discreet than traditional corporations. “The LP agreement is typically a privately signed document,” says Jason Powell, a corporate law attorney at Missoula, Montana-based Bjornson Jones Mungas, PLLC. “[LP agreements are] usually not recorded or available to the public, which allows for anonymity if desired.”Joint VentureA joint venture is a time- and scope-limited general partnership. It’s ideal for one-off projects that require pooled resources, such as commercial real estate development. Partners in a joint venture can convert the enterprise into a traditional general partnership by amending the partnership agreement.Pros of a PartnershipPooled Resources and Shared Responsibilities. Unlike sole proprietors, partners can pool resources without seeking outside investors or taking on debt. They can also share day-to-day management and executive decision-making responsibilities commensurate with their credentials and abilities.No Formal Incorporation Required. Unlike corporations, partnerships aren’t required to file articles of incorporation. For a variety of reasons, most partnerships are governed by written, legally binding partnership agreements to which all partners consent, but these agreements don’t have to be reviewed by or filed with local or state authorities.No Double Taxation. Partnership income is taxed on a pass-through basis. Partnership income is reported on Schedule K-1 (Form 1065), which the partnership must furnish to each partner by the annual deadline. Each partner adds his or her share of the partnership income, as reported on Schedule K-1, to his or her personal income from other sources.Flexible Time Horizon. Partnerships do not necessarily exist in perpetuity. If you need to pool your resources with other investors for a single project or venture, but have no wish to associate with them once the project is completed, you can create a joint venture specifically for that purpose. When the project wraps up, the partnership dissolves, and you and your partners part ways.Cons of a PartnershipPersonal Liability for Business Obligations. As with sole props, the greatest disadvantage of a partnership is personal liability for business debts and obligations. Your share of liability is proportional to your interest in the partnership – if you own 30% of the partnership, you’re responsible for 30% of its liabilities.Potential for Greater Tax Liability. Like sole prop income, partnership income is treated as personal income. If your partnership is profitable, your personal income will increase, potentially raising your marginal tax rate, increasing your overall tax burden, and reducing your usable cash on hand.Requires a Formal Agreement. Though partnerships don’t require formal articles of incorporation, virtually all are governed by partnership agreements. These contracts can be quite complex, and while it’s possible to modify a serviceable template at low cost, it’s expensive to hire an attorney to draft a customized agreement that accounts for the widest possible range of eventualities.Dependent on Human Relationships. Successful partnerships depend on amicable relations between the partners – at least, between general partners. A falling out among partners, for whatever reason, can cripple or destroy an otherwise successful partnership. Before entering into a long-term partnership (as opposed to a joint venture), consider your relations with the other partners carefully and ask yourself whether you can see yourself working with them for years to come. If you’re not sure, think twice.Shared Decision-Making Processes. Successful partnerships also depend on a consensus-driven decision-making process, especially when only two or three partners are involved. If you’re not comfortable talking through decisions with your collaborators, a closely held partnership may not be the best fit.Corporation (C-Corp)A corporation, sometimes known as a C corporation or C-corp, is defined by the Small Business Administration as “an independent legal entity owned by shareholders.”“Creating a corporation is like creating a human being,” says Toor. “Corporations can be sued, sue others, hold property, [and exist within] a partnership.”According to the SBA, “the corporation itself, not the shareholders that own it, is held legally liable for the actions and debts the business incurs.” Compared with sole proprietorships and partnerships, whose members are held personally liable for business debts and activities, this is a major advantage for corporate shareholders.C-corps are subject to greater regulation than partnerships and sole proprietorships. In addition to onerous incorporation requirements, C-corps face ongoing regulatory burdens, such as the requirement that they hold annual shareholder and director meetings. If you’re running a small enterprise with limited overhead, incorporation could be more trouble than it’s worth. Here’s a look at the basic initial and ongoing steps you’ll need to take to set up a C-corp.Incorporation RequirementsCorporations must be formally incorporated with state business authorities, typically the Secretary of State office or equivalent. This requires drawing up and filing articles of incorporation, which include basic information about the entity:Company name and DBARegistered addressName and address of registered agent who handles official correspondenceThe company’s business activities or purposeNames of directors and offersInformation about the issuance of corporate stock, including share count and par valueLimitation of liability (indemnification) of officers and directorsDuration of incorporationDissolution proceduresAdoption of corporate bylaws (operating agreement), if extantYou can find low-cost articles of incorporation templates online. However, as with partnership agreement templates, cookie-cutter articles of incorporation aren’t ideal. It’s better to spend more on custom-drafted articles of incorporation that account for a wider range of eventualities specific to your company.Corporate Operating AgreementsIn addition to articles of incorporation, which are required by law, most corporations are governed by operating agreements or bylaws. These documents spell out in detail the way the corporation is to be governed. Like partnership agreements, they’re not mandated by law, but they’re highly encouraged.Corporate Tax ObligationsUnlike sole props and partnerships, C-corps are not pass-through entities. For tax purposes, they are treated as legally separate entities from their shareholders. They pay federal, state, and sometimes local income tax at corporate rates, which are different than personal income tax rates. They are also subject to different credits and deductions than individual filers. Check with the IRS for more information about corporate tax obligations, including forms required to file.Pros of a CorporationLimited Liability for Owners. As long as the corporate veil is preserved, meaning shareholder and business assets are kept strictly separate (not commingled), C-corp shareholders are not personally liable for the entity’s debts and obligations. They aren’t required to personally guarantee loans or purchases made on credit, and their personal assets can’t be seized to satisfy creditor claims.Easier to Generate Capital. Corporations can raise capital by selling shares of stock (equity). Partnerships that wish to raise funds without taking on debt must take on new partners or compel additional contributions from existing partners. Sole proprietors are even more constrained – they need to dip into their personal savings, borrow against tax-advantaged accounts, ask friends and family members for loans, or pursue other less-than-ideal options.Greater Legitimacy. For better or worse, incorporated entities appear more legitimate to lenders, vendors, and potential customers. This legitimacy can open lucrative doors: loans approved at more favorable terms, discounts or favorable credit arrangements on big-ticket equipment or inventory purchases, and greater credence from sales prospects. For ambitious companies hoping to raise funds from venture capitalists or private equity firms, the C-corp is the gold standard. I spoke with Bryan Clayton, CEO of Nashville-based GreenPal, about his initial choice to incorporate locally as an LLC. “[Incorporating as an LLC] was quick and easy and cheap. We figured it was the best way to get our company up and rolling,” he says. “What we didn’t realize is that an LLC is a no-go for institutional investors. Any outside investors such as private equity, angel investors, or venture capitalists will insist that your company be a…C-corp.” Clayton adds that the incorporation domicile is important too: “Delaware has an abundance of case law that is favorable to corporate structure, investors, and board members,” he says, “and is [therefore] generally accepted as the standard by the investor community.”Built-In Incentives for Employees. Equity is a powerful incentive for current and prospective employees. Corporations frequently reward performance, longevity, and other value-adds with stock or stock options, attracting high-quality employees and incentivizing them to stick around. In partnerships, the possibility of making partners is a comparable incentive, but it’s not practical to offer that carrot to hundreds or thousands of associates. Corporations can offer stock to any employee they like.Cons of a CorporationPotential Tax Disadvantages. C-corps’ shareholder distributions are effectively taxed twice: once at the corporate level, before distributions are made, and again as personal income on shareholders’ personal tax returns. Though corporate income tax rates tend to be lower than individual income tax rates, and most corporations use generous deductions and credits to reduce their tax burdens, that’s not always enough to offset the effects of double taxation.Expensive and Cumbersome to Form. C-corps are expensive and cumbersome to form. Proper incorporation requires substantial legal and financial assistance, especially in heavily regulated industries.Greater Regulatory Burden. Even privately held corporations are subject to greater regulatory burdens than partnerships and sole proprietorships. If insulation from personal liability and greater capital-generation potential don’t outweigh these considerations, look to a lower-key business structure.Lots of Potential Stakeholders. Larger corporations can have hundreds or thousands of individual voting shareholders, all of whom need to be kept informed about the company’s activities and given a voice in the company’s direction. This requires a tremendous investment of financial and human resources. Even in more closely held corporations with tens of voting shareholders, the potential for disagreement is greater than in general partnerships, which usually involve only a handful of egos. As countless clashes between publicly traded firms’ boards and activist investors attest, larger shareholders can cause a lot of trouble when they’re determined to throw their weight around.S Corporation (S-Corp)An S corporation, also known as an S-corp, is a special type of incorporated entity that’s ideal for small to midsize businesses. Like C-corp owners, S-corp owners and shareholders are insulated from personal liability for business debts, obligations, and actions. Unlike C-corps, S-corps are pass-through entities. Their income isn’t subject to corporate income tax – it passes through as distributions to shareholders, who then pay personal income tax at an appropriate rate (usually lower than rates on wage income).Incorporating and operating an S-corp is an intensive process. Like C-corps, S-corps require articles of incorporation filed with the appropriate authorities, as well as annual shareholder meetings. Operating agreements are also strongly encouraged.S-corps have a few noteworthy twists:S Corporation Election: After incorporating, all shareholders must sign and file IRS Form 2553. Known as a Subchapter S election, this establishes the corporation as a pass-through entity subject to certain restrictions. The Subchapter S election must be made within two months and 15 days of the beginning of the tax year to which it applies, or anytime before the beginning of the tax year.Shareholder Compensation: S-corp shareholders who also work as employees – for instance, owner-operators or executives with ownership stakes – must take “reasonable compensation” (salary taxed as wage income) in addition to their profit distributions.Shareholder Restrictions: By law, S-corps can have only 100 shareholders. The potential pool of shareholders is restrictive as well: S-corp shareholders must be U.S. citizens and (in most cases) human beings. With rare exceptions, S-corps can’t be owned by other businesses or legal structures, such as trusts.Stock Restrictions: Unlike C-corps, which can issue common and preferred shares, S-corps can only issue common stock. Common shares represent equity stakes and confer voting rights, widening the pool of shareholders with sway over the company’s decision-making processes.Uneven State Tax Treatment: According to the Small Business Administration, S-corps are treated uniformly under the federal tax code, but they’re subject to varying treatments at the state level. While most states recognize S-corps as pass-through entities, some (such as New York and New Jersey) tax S-corps’ profits and shareholders’ income from said profits. If you live in a state that treats S-corps differently than the federal government, you may need to file an additional state form.This blog post from Wyoming LLC Attorney has more on the differences between S-corps and C-corps – it’s required reading for entrepreneurs deciding between the two.Pros of an S CorporationLimited Liability for Owners. Like C-corps, S-corps limit shareholder liability. As an S-corp shareholder, you’re not required to personally guarantee loans made to the business or expose personal assets to creditor seizure.No Double Taxation. Like sole proprietorships, S-corps are pass-through entities. Unlike C-corps, S-corps are not subject to corporate income tax. By extension, S-corp shareholders are permitted to deduct their firms’ losses, if any, from their personal income. “Most businesses initially lose money,” says Toor. “S-Corps may help lessen the blow of operating at a loss [because] S-Corp shareholders can deduct corporate losses on their personal tax returns.”Easier to Raise Capital. As corporations, S-corps can raise capital by selling stock. Though they’re permitted to issue common stock only, they still have more flexibility to raise capital on favorable terms than sole proprietorships and partnerships.Greater Legitimacy. Like C-corps, S-corps are incorporated entities, with all the legitimacy that entails. However, S-corps aren’t ideal for institutional investors, so you may need to reincorporate down the line before seeking outside equity funding.Cons of an S CorporationSize of Ownership Class Is Limited. S-corps can’t have more than 100 individual (human) shareholders. If you need to raise lots of capital from a wide investor pool, C-corp status is a better fit.Potentially Expensive to Incorporate and Operate. Like C-corps, S-corps are expensive and cumbersome to incorporate. They have high ongoing operating costs and burdens, such as the annual shareholder meeting requirement. And S-corp shareholders have to worry about another wrinkle: the annual Subchapter S election. C-corp shareholders can disregard that one.Reasonable Compensation Requirements. Since wage income is taxed at a higher rate than the “reasonable compensation” requirement, this raises S-corp shareholder-employees overall tax burden.Greater Record-Keeping and Regulatory Burden. Like C-corps, S-corps have greater record-keeping and regulatory burdens than sole props and partnerships. If the costs of increased compliance outweigh the benefits, a simpler structure is probably right for you.Shareholders Must Be U.S. Citizens. S-corp shareholders must be U.S. citizens. If you’d like to start a business with noncitizens living in the U.S. on visas, you need to choose another structure.Limited Liability Company (LLC)Extant only since 1977, the limited liability company (LLC) model is the newest common business structure available to U.S. business owners. By some measures, it’s the most flexible.“LLCs are hybrids between corporations and a partnership,” says Toor. “LLC members have the same rights and limited liability of shareholders in a corporation, and LLCs themselves have the added benefit of being treated like a partnership for tax treatment.”Tax TreatmentAccording to the IRS, LLCs can be classified as corporations, partnerships, or sole proprietorships (disregarded entities) for tax purposes. The classification depends on the number of members (shareholders) and those members’ stated preferences (elections).By default, one-member (single-member) LLCs are treated as disregarded entities, with pass-through business income recorded on members’ personal tax returns (Schedule C or C-EZ). Single-member LLCs can file taxes using members’ Social Security numbers – no EINs required.LLCs with two or more members are treated as partnerships, regardless of the number of members. However, any LLC – including single-member LLCs – can elect to be treated as a corporation for tax purposes. And even disregarded entities are treated as separate corporate entities for certain tax purposes, such as employment and excise taxes.Filing and Regulatory RequirementsLike C-corps and S-corps, LLCs are required by law to file articles of incorporation with the appropriate state authorities. Operating agreements are strongly encouraged as well. According to the SBA, state law often leaves LLCs vulnerable to member losses – for instance, when a member dies or resigns from a multimember LLC, the LLC dissolves, and the remaining members must elect to form a new LLC if they wish to remain in business together. Capable business attorneys can draft detailed operating agreements that account for common (and not-so-common) eventualities like this.Going forward, LLCs’ regulatory burdens are lighter than S-corps’ or C-corps’. “The main difference between an LLC and S corporation is operational flexibility,” says Brian Thompson, a Chicago-based CPA, and business attorney. “LLCs are not subject to the requirement of an annual shareholders’ meeting or annual directors’ meeting.”By watching this video anyone can get the idea of forming an LLC for their small business.Pros of an LLCLimited Liability for Owners. Like S-corp and C-corp shareholders, LLC members are not personally liable for the enterprise’s debts and obligations.Lower Regulatory Requirements. Compared with S-corps and C-corps, LLCs have more manageable regulatory requirements. While articles of incorporation are required and operating agreements strongly encouraged, ongoing record-keeping and reporting requirements aren’t as onerous.Can Avoid Double Taxation. As pass-through entities, LLCs aren’t subject to corporate income tax.Can Request S-Corp Status for Tax Purposes. Like C-corps, LLCs can request S-corp status by filing a Subchapter S election within the first two months and 15 days of the tax year. Depending on the entity owners’ duties and employee status, this can lead to a more favorable tax situation for shareholders. For more information about how a Subchapter S election could affect your LLC’s tax status and your personal tax liability (state and federal), consult a local tax advisor.Shareholders Can Be Non-U.S. Citizens. Non-U.S. citizens can be shareholders in LLCs. This is an important advantage over S-corps, whose shareholder ranks are closed to noncitizens.Corporations and Other Entities Can Be Shareholders. Unlike S-corps, LLCs don’t restrict membership to human beings. Corporations, trusts, partnerships, and other legal entities can own shares in LLCs. This is a crucial consideration for more complex ventures, which frequently utilize LLC subsidiaries to manage financial and legal risk.Cons of an LLCMembers Are Considered Self-Employed. For tax purposes, LLC members are considered self-employed. Like sole proprietors, they’re on the hook for self-employment tax – the employer’s share of Medicare and Social Security tax.Potential for Greater Tax Liability. If your LLC income is taxed on a pass-through basis, you can avoid double taxation. However, if the enterprise is profitable, you may still find yourself subject to a higher marginal rate and greater overall tax burden.Final WordMost new U.S. enterprises choose one of these five common business structures. I’ve included a lot of information about each here, but if you’re serious about launching a business and need firm guidance on the right structure for your needs, I’d recommend speaking with a business attorney.And, one more thing. There’s a sixth type of business structure not mentioned here: the cooperative.According to the Small Business Administration, a cooperative “is a business or organization owned by and operated for the benefit of those using its services. Profits and earnings generated by the cooperative are distributed among the members, also known as user-owners.”Cooperatives are more commonplace than many consumers realize, especially in the food business. Hundreds of thousands of U.S. consumers regularly shop at grocery cooperatives – member-owned grocery stores that often specialize in organic or natural foods. Millions purchase food products from massive agricultural cooperatives, often without realizing it. Land O’Lakes, a popular consumer dairy brand, is a multibillion-dollar cooperative. Though less recognizable to the average grocery shopper, CHS is even larger, more diversified, and more influential.All that said, starting a cooperative is very difficult. I’ve been personally involved with two cooperatives and can attest firsthand to the sheer amount of manpower and force of will necessary to get one off the ground. In certain circumstances, a cooperative may be the best business structure for your needs, but it’s not a one- or two-person project.

But is a franchise right for everyone? We take a look at the advantages and disadvantages of franchise ownership.The advantages:Dedicated franchise supportCentralized franchise support is without a doubt one of the biggest advantages of owning a franchise. The benefits of franchise support span the entire spectrum of the franchise journey, from the moment you become a franchise to the day you open your business and beyond. This can include everything from negotiating preferred supplier discounts to marketing.We ask prospective franchisees at our énergie Franchise Discovery Days to guess the number of steps there are between the time they sign their franchise agreement to the time they open their business. The answer usually astounds them. This really highlights the value in a franchise support system. Imagine launching a new business only to later discover there were hundreds of factors you hadn’t considered and the impact this would have?A franchisor will know every step of the process and will have the experience and knowledge of having guided many franchisees through that same process before you. They are there to provide timely advice and support through every step of the journey.No experience necessaryFranchise support is also crucial if you’re looking to start a business in a new industry and one that you are not accustomed to or don’t have any prior experience in. Many people look to franchising as an opportunity to change career paths and own a business in a different sector or industry. The franchise support system will give you all of the relevant industry-specific training you need to operate the business.Once you’re up and running a support team of experienced industry professionals will always be on-hand to offer advice and support when you need it.The power of the brandAs a franchise and being part of a wider network, you benefit from preferential rates from suppliers and significant cost savings. For instance, if you were to set up your own gym, the cost of kitting out the gym with equipment on your own would be significantly higher than if you were to do it as part of a franchise. This is simply because of the arrangement, relationship and terms the franchisor will have established with the supplier and the volume of equipment they buy through them.A proven business modelIt goes without saying that investing a proven business model is one of the key reasons why people choose to go into business with a franchise. There is an enormous benefit to operating a well-established tried and tested business model that has stood the test of time.What’s more, in addition to the franchise support team you also have the benefit of the wider network of franchisees, many of whom will be more established and can offer help and advice to new franchisees. Regular franchise networking events provide the opportunity to interact with other franchisees and share best practice.The disadvantages:Restrictions of the franchise systemWhen operating a franchise you are buying into a tried and tested business system and you will be required to follow the systems. This means that if you’re looking to re-invent the wheel, then you could find a franchise restrictive.Similarly, you can’t simply pick and choose the elements of the system you want to run and neglect the others. The franchise model is built on the system as a whole and in order to run a successful franchise and not fall into compliance issues, you will need to use the systems in their entirety.There are no cutting cornersFranchisors take their brand very seriously, and rightly so! They have invested significant amounts of time and money into establishing the brand and are highly protective of it. Therefore, you can’t cut corners on any aspect of operations, marketing or service delivery.This can come down to things such as using the correct branded template when displaying a notice in your business, rather than just simply copying and pasting the logo onto the document.Good franchisors will regularly audit their franchisees, and the benefits of this are two-fold. Firstly, the franchisor can ensure that their standards are continually being met ensuring that the service delivery isn’t compromised and remains consistent with the brand standard.Secondly, for the franchise audits can help to highlight areas of improvements for the business that can drive performance. At the same time, an audit can re-enforce the good things you are doing in your business giving you the confidence and knowledge that you are going about your business in the right way.So why does this sit in the potential disadvantages? During an audit, a franchisor will maintain that every aspect of the system should be followed. Therefore, during an audit, you could be marked down for not displaying the correct branded template for a poster. This may appear trivial to you but is essential for the franchisor.That said, your entrepreneurial creativity and flair don’t have to be restricted by owning a franchise. Following the franchise systems in their entirety combined with your own entrepreneurial flair can be the perfect blend for franchise success. Some franchisors can be open to ideas, feedback, and input for new initiatives from franchisees, providing that the franchise has a track record of performance based on following the business system.Franchise business is on fire these days, my ideas for the best franchise as looking forward to this period of time is the company, who is achieving success day by day because of their working ethics and responsibility of fulfilling their customer's needs at the time. The best franchise I would like you to take is Phixman. One of the most intriguing firms in India.They are best because:-Significant capital required.Large overhead.Borrowed capital utilized must be repaid.Large time & expense requirements.Management problems related to a span of control, supervision demands, difficulty in hiring and maintaining competent managers.On the off chance that you have a Smartphone and Laptop, well, considering the present world, you beyond any doubt have it, at that point, you have come to at the opportune place! Phixman reclassifies the word 'settling' by making it all the more simple, compelling, proficient and inside the span of the considerable number of mortals, who thought getting a telephone or a workstation repaired may be the most noticeably awful bad dream of their lives. Phixman incepted with a plan to influence Smartphone to repair a breeze and this is the zone we exceed expectations at! 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The needs of the country and the people n the context of COVID19 should be the first consideration.68% of British people including Tory Voters do believe that Dominic Cummings broke lockdown rules. However, there are the lives of 65,000,000 people that are being influenced and affected by both the strategies and many of the decisions Dominic Cummings and others make.If for a moment you try to consider all the fresh food consumed in all of the UK’s supermarkets in one whole year. Then consider that quantity of food from now until 2028. That is less money than the UK borrowed in the month of AprilHe had Corona virus himself as did his partner. He got into a car, less than 2 metres apart with his child. Whilst there are legal debates to be had, I believe it is erroneous to consider the legal side of this as the only consideration. I believe, seeing this from a strategic perspective is more important.He together as the top UK strategist and Boris Johnson as Prime Minister are making more life changing choices over British people than any other person has since Churchill. Therefore, any reckless action that any Uk leader, MP, politician has taken in the past 70 years is of less significance than the decisions these two people are making today.Quite simply the strategic decisions of both Mr Cummings is affecting not only the pandemic but the entire future of the UK population. So therefore, with such as responsibility, with decisions made today based entirely upon the quality of strategy. So it is evident that the decisions made today by him will likely affect you for the rest of your life and if you have children today much of their lives too, with the decisions made today. This is irrespective of which political party you vote for, the scale of debt could make good politics in future impossibility. Whilst borrowing is clearly essential, on such a scale is not just due to the pandemic, it is caused by a lack of effective planning as much as the pandemic.Considering that there were so many discussions over a bill to the EU with brexit of less than 30 Billion and three times that has been borrowed in just one month. The gravity of decisions today is unprecedented..There is every reason for politicians to want to properly ascertain exactly what has gone on in politics with regards to “strategy’ and “strategists” both in the past and the present and having a full awareness and understanding of this is more essential today.If there are unmentioned and unknown considerations, they have got to be out in the open, known and discussed. Anything else and the austerity measures of past years could be less to what’s experienced in today.If there is any dishonesty or unsaid truths, un-whole truths then this is not just breaking the law with something that would warrant a one hundred pound fine. This could be making the entire country economically broken broke for decades. Bad decisions in the strategy today is irreversible in irreversible.So the entire health, wealth and future fortune and happiness of this country present and future is dependent on actions at this time. So with the extraordinary importance of making exactly, exactly the correct choices never before in this great land have more people had more of their own future based upon the decisions of these two people since Winston Churchill said something more or less like this before.The situation is just so, so serious that I have to make a joke. When added to that there is the very clear reality of the situation that a great many countries are looking clearly at the choices and tactical decisions that the UK makes, as this country is a very highly regarded country in the world. The responsibility is great. Therefore, I believe it is very important not only to consider the actions of what happened, yet also consider the way it was responded too.The press briefing today outside of his house would clearly have been pre-planned and choreographed. The questions were very reasonable and actually easy to answer. Whether he broke the low or not is one aspect. Yet not properly answering the question and then diverting attention towards the journalist/ You are not 2 meters apart. I think the British people would sooner have him put his hands up and say yes, I made a mistake. It’s been a time of so much responsibility I made a wrong decision than to see avoidance of answering questions or being clever. This is not about being cleaver this is about properly knowing the full responsibility that he has. Everyone makes mistakes, and someone making really excellent decisions for the country and the people should be cut a bit of slack under these circumstances. However, delivering a few lines that keep him in a job isn’t what the Uk needs right now.The countries of the United Kingdom under his strategic planning have for the first time become not in alignment with each other. There is a real seething frustration that all the other countries have and it’s easy to see why. What’s even more concerning is that one one hand there is a monumental gamble occurring with the Furlough and yet no strategic planning to try and find immediate ways to greatly lessen the burden of what’s occurring. The strategic planning and innovation should be producing new answers every single day. Rather than having the daily Downing Street briefings on transport and charts. The conversation should be on the basics of how tenants and landlords find fair answers, where the food guarantees for this winter are going to be, what strategies the government can offer for businesses to return without affecting social distancing. The message of staying alert they need to think about themselves or its hard to know what will come first economic crisis or hunger.The waving of the children’s toys, sorry we don’t need “a great dad” at the moment just trying to do his “dad things for the kids” no we need a really straight talking, dynamic skillful strategist that is not just “thinking about his own family” but is thinking about everyone’s family. Prioritizing the welfare of the country first in this national emergency. What that actually means is beggining with the most important issues ie Pandemic strategy, food security, business and employee adaption and being strategically savvy enough to be able to explain in great detail how exactly the country artfully goes as far as it can to being a fully functioning country again within the constraints of the pandemic.So he has an allabi for why he went and that is a subject of discussion, however lets properly check this.1. He left his house with Corona virus.2. His partner left the house with Corona virus.3. They sat in a confined space in a car less than two metres apart from their children, with or without wearing masks I wonder?4. They drove 400 miles and if they would have broken down then that would have created other issues.5. They stayed in another property.So my consideration from a “strategist in a national emergency” perspective is firstly why has he got the job in the first place? If he is a seemingly busy father as he was presenting himself as this morning. Yet, from a strategy perspective in a national emergency why is he wasting time in a car travelling to work. Would it not be better for him to be living and working from the same place to save time?In an emergency situation like this doing four things almost all of the time. 1. Work. 2. Sleep. 3. Time to refresh his thinking in order to work. 4. Methods to obtain strategic inspiration. That really should be the content of his life. Being truly excellent strategist he should be living strategy, not juggling chores. A bit of family time is understandable of course. Yet chores should be delegated. The UK needs someone thinking on strategy and managing departments of strategists 24/7 that help the country re-plan and adapt.A strategist should have his life organized so all the usual domestic chores are covered, so he has maximum time to think and plan, after all the country is playing 5-D chess with a pandemic and the country needs to know how he best intends to get 65,000,000 people out of the current conundrum.The other aspect of this is to some extent as a strategist with such high levels of responsibility for so many people and under these emergency conditions that if there was something that helped him do his work, if that was going to help him work better and save lives then there should be grounds for there being exceptions in terms of his actions and in terms of the resources he has available to him to call upon. However, this would all be well justified if the strategy work he had been producing was brilliant, yet it’s not. really is the type of standard in terms of strategy the UK’s top strategist should be producing at this time, considering the UK is the most affected countries in the world for the size it is.So looking at this from another angle.1. The strategy for Nightingale Hospitals was good..2. The use of the army in helping with the logistical side of the pandemic again, very good thinking. The speed and capacity in setting up those hospitals was an inspiration to the world and other countries then had a template to work to and whilst this may have been complimented by the decision to have hospital ships on both coasts of the USA. This was all really effective thinking.3. The fact that there were too many hospital beds was the correct way to go considering the scale of the crisis. For a pandemic scenario, it’s better to widely over estimate resources than underestimate as that is the only way to save lives.4. The strategy for PPE was and still is incompetence unequalled. The UK by now five months into this. There have been deaths in the hundreds of medical staff. This is a complete disgrace for the country that invented clothing manufacturing. A good strategist would by now have turned the deficit to an advantage and the UK would be the top manufacturer of PPE in Europe and be exporting.5. The Sending of elderly people back to care homes where they infected other people in the care homes, where there are staff untrained to deal with Covid19 patients and without PE equipment. When people in care homes could have been sent to Nightingale Hospital and received safe and professional help. They were instead sent to care homes and therefore further spread the virus.6. Being so late to define and provide even a detailed explanation or even a vague theory in the context of BANE fatalities when there is a thesis in the UK that has been promoted for the past month and is being ignored is shocking .7. The fact that nurses are 1. Risking their lives. 2 Crying in their cars. 3. Dying. 4. Protesting and begging for PPE in a time of emergency. This is when most manufacturing sites in the country are not in use and the entire population is trying to occupy themselves. It’s just wrong, the whole situation. In my option there is more grounds to sack him on PPE as this is risking the lives of the whole country.8. The “Herd Immunity” mistake. This was as illogical as telling people to not use condoms for sex to build up herd immunity to HIV/Aids virus. The policy would pure guess work and if the correct strategic action would have been taken at the right time the UK may not now by having to borrow in a month more than 80 Billion, which is far more than half the NHS annual budget.9. Ignoring the fermented food's link which correlates 100% with countries that have best-overcome Covid19 and been the most resistant to it. With 91% of patients dying in the Uk having secondary symptoms. These also being illnesses that affect probiotic flora and digestion. This being ignored even with Imperial College doing research into this in the context of COVID19 and their being very substantial scientific evidence proving the effectiveness of some foods against coronaviruses.10. The use of “track and trace” when this was most relevant prior to the whole country being infected.11. The instigation of temperature checking at UK airports two months after Indonesian Airports.12. The lack of any temperature testing in streets and shopping centers even three months after Indonesia.13. The mixed messages with wearing facemasks.14. The consideration that NHS employees from abroad would have to pay for their own medical care even if they caught Coronavirus whilst doing their jobs.15. The pay freezes of NHS staff and lack of bonuses when they are risking their lives everyday.16. The lack of presenting any feasible explanation to Kawasaki and Covid Toes when there is a theory on this that is not being considered.17. The harvests of vegetable and fruit production in the fields is essential and yet bringing in a plane full of Romanian farm labourers is clearly not an effective answer. There needs to be better strategy work on this as soon as possible. I have designed a model that would achieve this goal and be very fair on the people that pick the harvests.What could be done better.1. Clear science on each and anyway as potential prevention presented and explained to all, especially care home and NHS staff.2. Full explanation of any viable thesis that could indicate how or why BAME communities are more vulnerable and how they may be able to protect themselves better, namely presenting the datary links which is represented in all International statistics.(worldometers dot com.3. Tennant and Landlord dispute resolution established to decide on cases where landlords and tenants do not reach a previous agreement. All judgments means-tested and the advantage goes to the least means able party. Therefore, there are not landlords with many houses and shops squeezing out of business tenants and there are not highly means available tenants putting landlords without means out of business.4. Businesses should be grouped as to how pandemic resistant they are. Furloughing schemes shifted so that there is both give and take. The creating of a fully functioning collaborative economy, a sharing economy, a crowd source economy and a crowdfunding economy.5. The teaching of “Integrated Strategy” creation so any company or organization can utilize this in order to help them reduce their dependency and increase and connect to opportunity..6. Creation of strategy centre to present new strategies every day.7. Creation of cooperative hub networks to feed into a national resource network.8. Integrated Strategy for the NHS established immediately to benefit all NHS staff and increase resources.These are few strategies, each of them helps the people, the country and reduces the need for unnecessary borrowing. These should have been instigated before the virus even reached the UK. If these would have then there would have been far less economic disruption. The sooner they are instigated the better for people that help from all sectors of society.There should be a full review of all government strategy. Mr Cummings, his strategies both for the government. However do I think he should be fired? He has become a strategist for a pandemic from being engaged in partisan politics. There is no spin doctoring Covid19. Whilst the original strategy for Covid19 may have been to “save the economy” If that means borrowing 90 Billion a few weeks on, then I question the strategy is to save the economy.Whilst there are references made to us fighting a war against this virus, you cannot win a war by public relations. The government needs a strategist that specializes in solving the most challenging to solve problems. Not just someone that agrees with the a political perspective.Do I think he should be sacked? I believe the needs of the country and the people have to be put first. That equates to having ever-improving strategies every day. Yes of the death stats unless they are producing new answers and there needs to be consistency. In my opinion, he is certainly not suited to being in the job he is in at this time. However, continuity and lack of disruption is first priority. Where we are today. People, business, self-employed, landlords, tenants and people that eat food all require strategy that is effective. If that strategy can be produced better with him being a part of that then yes, otherwise no. The needs of the country has to come first, this is still every bit an emergency and so, therefore, clear thinking is a priority. Being honest about the situation and tapping into the extraordinary collective wisdom of the people so each, and every answer can be made the best use of. This is more important by far than thinking in terms of people's careers.The UK for the size of the country is struggling with Covid19, 36,675 people have lost their lives to this pandemic. From here the best way through this crisis has got to be a much better strategy, if there is an advantage towards instigating that strategy with Dominic Cummings in then he should stay, if not then he should go.However, either way based upon the strategy he has produced to date and the errors made, keeping him as head of strategy is wrong, and if the example above and the figures do not show that now they will continue to. The UK certainly needs a rethink on every aspect of the virus and a new ever-improving strategy makes good sense.