A business is defined by Wikipedia as an unincorporated company or sole proprietorship, sometimes having only one or few partners. Businesses may be sole proprietors, partnerships, corporations, limited liability companies (LLCs), or service businesses. Businesses can also be sole proprietors, partnerships, corporations, LLCs, and for-profits. Professional services are excluded from the definition of a business.
A corporation is a legal form in which one or many people to own and manage the assets of another company. This company is separate from its owners and usually has separate operating and capital finances. Limited partnerships, which share in the profits and losses of the corporation, are also classified as corporations. A limited partnership agreement contains the details of the partnership, including the investors and liability for business debts.
For most purposes, a sole proprietorship is a more appropriate entity than a corporation or a limited liability company. A sole proprietorship is considered a partnership or business and therefore liable for all business debts. Its owner(s) are individually and exclusively liable for the operation of the business. In contrast, a corporation or limited liability company is generally formed for the benefit of all members, who are then individually and jointly responsible for their portion of the profits.
A corporation, limited liability company, or sole proprietorship must report its profits and loss statements yearly to the U.S. Secret Service under the Internal Revenue Code. It must also pay taxes on its income and dividends to the IRS.
There are five main keys takeaways for running a successful small to medium sized business. These include strong management, marketing, sales, public image, and the structure of the business. Although each of these key takeaways can be expanded upon, these are the basics. All other factors of the organization must be considered in light of these basic principles.
Strong leadership includes the ability to set goals and devise a strategy to achieve those goals. A sole proprietorship lacks this ability and must hire a board of directors to set the goals and strategy for the business organization. Having a clearly stated purpose for the business and an executive leadership team will help achieve those goals. The board of directors will help set the terms of the business and help to oversee the day to day activities of the business organization. A good marketing plan, sales strategy, and public image strategy to help the organization achieve its goals.
Selling a service or product is the first and most important step. Many people do not want to sell in this situation, and that is where a marketing plan comes into play. A great marketing plan can drive interested clients to your firm and increase profits. A strong executive leadership team and/or a skilled marketing team will identify the best key terms related to the products or services that the firm is offering and will build a reputation for the firm on the market. A good marketing strategy will also include the development of the firm’s brand.
The purpose of starting any type of business is to make money, however, the goal of most businesses is to create a long-term value for their customers. A firm must have a well-defined long-term goals and strategies in place in order to achieve those goals. A firm cannot sell widgets to individuals; it must offer a service or product that individuals desire. This article has provided a brief overview of basic concepts of business success.
Identifying and focusing on core competencies is an important factor in the success of any business. All organizations should have a specific, clearly defined set of key business goals. These goals should be written down and organized by the leaders in the organization. Once these goals are identified, they can then be used as a guide by the company to achieve the company goals. A key takeaway from this point is to always remember, “A picture is worth a thousand words.”
Marketing should always be considered a second thought process, after developing and implementing a business plan. Market research should always take place before any advertisement campaigns are created. A marketing team should be involved in each step of the advertising process, from researching key terms associated with the target market, through to the creation of ads, and finally, into the distribution of those ads. Once advertising is developed, it should be used to develop a targeted advertising campaign to reach the targeted audience. All advertising should be considered in light of potential profitability. When the marketing process has been developed, and is in place, any advertising efforts should be tracked and monitored closely to ensure a continual return on investment.
Once all the advertising, market research, and related processes have been developed, the firm should track all metrics and trends to determine if the strategies being employed are producing the desired results. Once profitability is reached, and a firm is generating a sufficient amount of revenue minus costs, the firm should look at increasing the size of the business. This can either be done organically, by buying another company with complementary products, or by taking on another partner who has the experience necessary to grow a larger business. Regardless of which method is chosen, the goal should always be to expand the firm into new markets, reaching more customers and generating more profit.