Business start-up process - Essay Example

Choosing a Legal Structure In order to start a new business and to move forward in any given industry, it is important first to actually determine the overall legal structure of the firm. Legal structure of the firm describes as to what will be the liabilities and obligations of the owners of the business. However, to exactly decide and choose a legal structure, it is important first to decide on certain other issues which will ultimately determine as to what legal structure a business should chose.

The first part is to evaluate the capital in hand and what you can achieve with that much capital. This therefore will further determine the overall financing requirements and what sources of finances to be sourced from outside. It is also important to evaluate the type of business to be started while at the same time determining the capital requirements for the business. After evaluating the business, evaluate the management skills because management skills technically determine as to what kind of business to be run.

If an individuals or group of individuals are not skilled enough to run a relatively complicated or simple organization such as a sole proprietorship It is also critical to actually determine the number of persons who will be involved in running the overall affairs of the business. This step comes after the determination of skills and ability to raise the finances, it is important to evaluate the number of people required for running the overall business affairs of the firm. Assessment of liabilities and risks is the next step in the process of choosing right legal structure for the firm.

Each type of business carry different risks as sole proprietors may be personally liable for all the liabilities of the firm whereas shareholders in a corporate are only liable up to their shareholding in the firm. This step will therefore help to crystalize the kind of liabilities the owners of the new business are willing to take. The assessment of the personal tax situation is the next step because tax liability and its impact on the personal as well as business income can create important impact on the overall income of the firm.

It is also because of this reason that the assessment of income is the next step. At this step, it is critically important to actually formalize the overall income expectations and what new business expects to earn. Based on this assessment the overall business plan of the firm is prepared. The step before choosing the legal structure for the firm, evaluating and assessing the long term business plan of the new business is crucial. The new business plan actually will determine the overall strategic orientation of the firm in future.

Long term business plan will outline as to what the firm actually wants to achieve in long run and what resources will be required to achieve this. Once this assessment is completed, the next step is to choose from either the sole trading business, partnership, trust or a company depending upon the factors described above. Protecting the Business In order to critically protect the business, it is important firs to determine and identify the business name in order to ensure that it is not used by others and its goodwill is not cashed out.

Identification of the business structure as well as the assets is another important step because it determines as to what assets need to be protected by the business. If the assets are non-registerable i.e. they cannot be registered with any authority, choosing suitable IP and obtaining copyrights for the domain names are important steps which need to be taken in order to protect the assets of the business. However, if the assets are registerable, it is important to design the trademark and obtain patents for it.

The overall process of obtaining patents is to apply through IPAUS where if you are already registered, you just need to log on to the system however, if you are new user, you need to register yourself first before actually applying for the patents. After the registering process, the next step is to upload all the required documents to register for the patents and pay the required fees. Once this step is completed, the application will be processed by the authority and decision will be made as to whether the patent should be granted or not.

The overall process therefore requires registration of the patents to secure and safeguard the intellectual property of the newly formed firm. Business Insurance In order to properly assess the business insurance needs, it is important to identify the business name, the overall structure of the business, business location and type of the business. This is considered as important in order to understand and better evaluate the business insurance needs of the newly formed firm. Once this phase is over, it is important to actually search for the viable insurance plans which can fulfill the criteria and business needs.

The overall evaluation of the insurance firms however, should be based upon assessing the financial stability of the company as well as the best customer services offered. Once an insurance company is evaluated based on this criteria, the next step involves the identification of the required insurance. The required insurance falls into three distinct classes of insurance and the firm must it has successfully covered the insurance for liability, people as well as the asset and revenue insurance.

Liability insurance may cover public liability, professional indemnity as well as product liability. The people insurance however, will cover the employee superannuation as well as the employee compensation. The asset and revenue insurance however, will be covering the building and contents, electronic equipment as well as the employee dishonesty. The business insurance needs of the organization can be different public liability insurance may cover the firm for the liabilities incurring towards any third party whereas professional indemnity can actually safeguard the firm against the losses incurred by third parties due to professional advice given by the firm.