This document discusses various forms of business ownership including sole proprietorships, partnerships, corporations, S-corporations, franchising, and joint ventures. It outlines the key characteristics of each including ownership requirements, tax treatment, advantages, and disadvantages. Criteria like liability, ease of formation, access to capital, and control are compared across the different structures.

1. Wirausaha dan Bentuk
Perusahaan
Kelas Pengantar Bisnis
Fakultas Ekonomi
Universitas Padjadjaran
Bandung
1

2. Bill Gates
2

3. ENTREPRENEU
R
SESEORANG YANG MEMPUNYAI
KREATIVITAS SUATU BISNIS BARU
DALAM MENGHADAPI
RESIKO DAN KETIDAKPASTIAN
YANG BERTUJUAN UNTUK PENCAPAIAN
LABA DAN PERTUMBUHAN USAHA
BERDASARKAN
IDENTIFIKASI PELUANG
DAN MENDAYAGUNAKAN SUMBER-SUMBER
SERTA MEMODALI PELUANG TERSEBUT
3

4. CIRI-CIRI ENTREPRENEUR
 MEMPUNYAI HASRAT UNTUK SELALU
BERTANGGUNG JAWAB BISNIS DAN
SOSIAL
 KOMITMEN TERHADAP TUGAS
 MEMILIH RESIKO YANG MODERAT
 MERAHASIAKAN KEMAMPUAN UNTUK
SUKSES
 CEPAT MELIHAT PELUANG
4

5. CIRI-CIRI ENTREPRENEUR 2
 ORIENTASI KE MASA DEPAN
 SELALU MELIHAT KEMBALI PRESTASI
MASA LALU
 SIKAP HAUS TERHADAP “MONEY”
 SKILL DALAM ORGANISASI
 TOLERANSI TERHADAP AMBISI
 FLEKSIBILITAS TINGGI
5

6. USAHA KECIL
D ONE MAN ENTERPRISE
E
V
E FAMILY ENTERPRISE
L
O
P SMALL SCALE ENTERPRISE
M
E
N
T
MEDIUM SCALE ENTERPRISE
BIG SCALE ENTERPRISE 6

7. Factors Affecting the Choice
 Tax considerations
 Liability exposure
 Start-up capital requirements
 Control
 Business goals
 Management succession
plans
 Cost of formation

8. Major Forms of
Ownership
 Sole Proprietorship
 Partnership
 Corporation
 S Corporation
 Limited Liability Company
 Joint Venture

9. Advantages of the Sole
Proprietorship
 Simple to create
 Least costly form to begin
 Profit incentive
 Total decision making authority
 No special legal restrictions
 Easy to discontinue

10. Disadvantages of the Sole
Proprietorship
 Unlimited personal liability
 Limited skills and capabilities
 Feeling of isolation
 Limited access to capital
 Lack of continuity

11. Ownership
Requirements Tax Treatment Liability
One owner Income and losses Unlimited
“pass through” to personal liability
owner and are
taxed at personal
rates

12. Advantages Drawbacks
Low start-up costs Unlimited personal liability
Freedom from most Personal finances at risk
regulations Miss out on all kinds of
Owner has direct control business tax deductions
All profits go to owner Total responsibility
Easy to go out of business if May be more difficult to raise
necessary financing

13. Advantages of the Partnership
 Easy to establish
 Complementary skills of partners
 Division of profits
 Larger pool of capital
 Ability to attract limited partners
 Little government regulation
 Flexibility
 Taxation

14. Disadvantages of the
Partnership
 Unlimited liability of at least one partner
 Capital accumulation
 Difficulty in disposing of partnership interest
 Lack of continuity
 Potential for personality and authority
conflicts

15. Types of Partners
 General partners
 Take an active role in managing a business.
 Have unlimited liability for the partnership’s debts.
 Limited partners
 Cannot participate in the day-to-day management
of a company.
 Have limited liability for the partnership’s debts.

16. Ownership
Requirements Tax Treatment Liability
Two or more Income and losses Unlimited
owners “pass through” to personal liability;
partners and are Personal assets
taxed at personal of partners are
rates; flexibility in at risk
profit-loss
allocations to
partners

17. Advantages Drawbacks
Ease of formation Unlimited personal liability
Pooled talent Divided authority and
Pooled resources decisions
Somewhat easier access to Potential for conflict
financing Continuity of transfer of
Some tax benefits ownership

18. Types of Corporations
 Domestic – a corporation doing business in
the state in which it is incorporated.
 Foreign – a corporation doing business in a
state other than the state in which it is
incorporated.
 Alien – a corporation formed in another
country but doing business in the United
States.

19. Advantages of the
Corporation
 Limited liability of stockholders
 Ability to attract capital
 Ability to continue indefinitely
 Transferable ownership

20. Disadvantages of the
Corporation
 Cost and time of incorporating
 “Double taxation”
 Potential for diminished managerial
incentives
 Legal requirements and regulatory “red
tape”
 Potential loss of control by founder(s)

21. Ownership
Requirements Tax Treatment Liability
Unlimited number Dividend income is Limited
of shareholders; taxed at corporate
no limits on types and personal
of stock or voting
arrangements shareholder levels;
losses and
deductions are
corporate

22. Advantages Drawbacks
Limited liability Expensive to set up
Transferable ownership Closely regulated
Continuous existence Double taxation
Easier access to resources Extensive record keeping
Charter restrictions

23. S Corporation
 No different from any other corporation from a
legal perspective.
 For tax purposes, however, an S corporation
is taxed like a partnership, passing all of its
profits (or losses) through to individual
shareholders.
 To elect “S” status, all shareholders must
consent, and the corporation must file with
the IRS within the first 75 days of its tax year.

24. Ownership
Requirements Tax Treatment Liability
Up to 75 Income and losses Limited
shareholders; no “pass through” to
limits on types of partners and are
stock or voting
arrangements taxed at personal
rate; flexibility in
profit-loss
allocations to
partners

25. Advantages Drawbacks
Easy to set up Must meet certain
Enjoy limited liability requirements
protection and tax benefits May limit future financing
of partnership options
Can have a tax-exempt
entity as a shareholder

26. Articles of Incorporation
Elements to Include:
Company name
Business purpose
Names and addresses of incorporators
Names and addresses of initial officers and directors
Address of corporation’s home office
Capital required at time of incorporation
Capital stock to be authorized
Corporate bylaws
Corporation’s time horizon
Other pertinent miscellaneous information

27. The Franchising Boom!!!
 Sales of $1 trillion in virtually every
product or service imaginable. Boom!
 More than 4,500 franchisers operating
some 600,000 outlets worldwide.
 Franchise sales account for 44% of
total retail sales.
 A new franchise opens somewhere in
the world every six-and-a-half
minutes.

28. Types of
Franchising
 Tradename
 Product distribution
 Pure
(or Comprehensive or Business
Format)

29. Benefits of Franchising
 Management training and support
 Brand name appeal
 Standardized quality of goods and
services
 National advertising program
 Financial assistance
 Proven products and business formats
 Centralized buying power
 Site selection and territorial protection
 Greater chance for success

30. Drawbacks of Franchising
 Franchise fees and profit sharing
 Strict adherence to standardized
operations
 Restrictions on purchasing
 Limited product line
 Unsatisfactory training programs
 Market saturation
 Less freedom

31. Ten Myths of Franchising
1. Franchising is the safest way to go into business
because franchises never fail.
2. I’ll be able to open my franchise for less money
than the franchiser estimates.
3. The bigger the franchise organization, the more
successful I’ll be.
4. I’ll use 80 percent of the franchiser’s business
system, but I’ll improve upon it by substituting
my experience and know-how.

32. Ten Myths of Franchising
(continued)
5. All franchises are the same.
6. I don’t have to be a hands-on manager. I can be
an absentee owner and still be very
successful.
7. Anyone can be a satisfied, successful franchise
owner.

33. Ten Myths of Franchising
(concluded)
8. Franchising is the cheapest way to get into
business for yourself.
9. The franchiser will solve my business problems
for me; after all, that’s why I pay an ongoing
royalty fee.
10. Once I open my franchise, I’ll be able to run
things the way I want to.

34. Detecting Dishonest Franchisers
 Claims that the contract is “standard; no need to
read it.”
 Failure to provide a copy of the required
disclosure documents.
 Marginally successful prototype or no prototype.
 Poorly prepared operations manual.
 Promises of future earnings with no
documentation.
 High franchisee turnover or termination rate.
 Unusual amount of litigation by franchisees.

35. Detecting Dishonest
Franchisers
(continued)
 Attempts to discourage your attorney from
evaluating the contract before signing it.
 No written documentation.
 A high pressure sale.
 Claims to be exempt from federal disclosure laws.
 “Get rich quick” schemes, promising huge profits
with minimal effort.
 Reluctance to provide a list of existing
franchisees.
 Evasive, vague answers to your questions.

36. The Right Way to Buy a
Franchise
 Evaluate yourself – What do you like and
dislike?
 Research your market.
 Consider your franchise options.
 Get a copy of the franchiser’s Uniform
Franchise Offering Circular (UFOC) and read
it.
 Talk to existing franchisees.
 Ask the franchiser some tough questions.
 Make your choice.

37. Factors That Make a Franchise
Appealing
 Unique concept or marketing approach
 Profitability
 Registered trademark
 Business system that works
 Solid training program
 Affordability
 Positive relationship with franchisees

38. Trends Shaping Franchising
 Changing face of franchisees
 International opportunities
 Smaller, nontraditional locations
 Conversion franchising
 Multiple-unit franchising
 Master franchising
 Piggybacking (Combination franchising)
 Serving baby boomers

39. Ownership
Requirements Tax Treatment Liability
Two or more Income and losses Limited, although
owners “pass through” to one partner must
partners and are retain unlimited
taxed at personal liability
rates; flexibility in
profit-loss
allocations to
partners

40. Advantages Drawbacks
Good way to acquire capital Cost and complexity of
from limited partners forming can be high
Limited partners cannot
participate in management of
business without losing
liability protection