Home Electrical Contractor Free Electrical Contractor Business Strategy Questionnaire 2.1 Business Ownership Questionnaire
The company ownership section of the business plan for Lights On Electrical, Inc. is where you tell the reader of the plan about how your business is structured and how many partners or owners the business has. This is a very important area of the business plan on Electrical Contractor since this is where you tell the banks, non-bank lenders and prospective venture capitalists who owns the shop.
Ownership v/s Management
It is not uncommon in the small business world for the key managers of the business to be a small or silent partner in the business while the majority of the controlling interest in the business is in the hands of one or two individuals. It is particularly common amongst family run businesses to find that the person with the managerial experience handling the day to day operations of the business may not have the financial capital or credit and collateral to be able to buy or own the business outright and there may be a friend or family member who will act as a silent partner and assist in the business getting underway.
Structure of the Business Entity:
The choice of structure of Business Entity for a Electrical Contractor is a complex matter and we recommend that you consult your attorney and or your CPA for advice before you make a decision on how a business should be structured. In the Electrical Contractor you can choose from the most commonly used forms like Sole Proprietor, General Partnership, Limited Partnership, S-Corporation and C-Corporation to the more complex ones like Limited Liability Partnership and Limited Liability Corporations.
Does the structure of Lights On Electrical, Inc. affect its ability to get business loans or venture capital?
The short answer is yes. When banks and non-bank lenders are looking to small business loans or SBA loans, they often require that the small business be an incorporated entity or formal business structure. The reason for that has to do with the litigious nature of the business environment nowadays. It is generally understood that entities like Sole Proprietorship and General Partnership may leave the business owner vulnerable to lawsuits where their own personal wealth and assets could be at risk when compared to other forms of business entities. It is usually preferred by lenders that small businesses incorporate. Certain industries have requirements that entail that the small business owner have at minimum a certain business structure to be able to address the issues of liability. Many large companies that have franchisees insist that their franchisees are incorporated as either Corporations or Limited Partnerships so that they have a larger degree of protection in the event of a lawsuit. Even if the practice in the Electrical Contractor is to have a sole proprietorship structure, we highly recommend in these litigious times that you consider the options of incorporating into a more formal business entity structure after consultation with your CPA and attorney.
Information on Incorporation
We have a wonderful Free Incorporation Guide as well as a completely Free State Incorporation Resource Directory that will give you a ton of information on the benefits and disadvantages of different kinds of business structures Electrical Contractor as well as where to go in the state of Ohio to set up the business structure for your small business.
The Foundation Grant Directory is a free listing of sources for grants by state. Why not look if there is some free money out there for your business. Hey - you never know!
The Business Loan Application covers every item you will need in your loan package and tells you how to get approved for business loans.
Fire your loan broker and use our Free Business Loans Bank / Lender Directory to find every bank in the country lending to small businesses.