| Before setting out into the great sea, it is wise to chart | | | | paying taxes at the corporate level. For those that |
| the waters. What's the destination? Where are the | | | | want to depend on gifts, grants, some government |
| currents? Where are the shoals? What's the fastest | | | | contracts and donations, the nonprofit structure is the |
| route? How's the weather? There are a lot of pitfalls | | | | way to go. After incorporating as a nonprofit a 501c3 |
| at sea and just as many in launching a small business. | | | | form must be filled out and returned to the Internal |
| The essential chart to success is a business plan. | | | | Revenue Service in order to qualify the company to |
| In an ocean of blue sky and blue water the chart is | | | | reward donors with tax credits. |
| essential with maps, radio, GPS, and compass. A new | | | | So, the structure of profit corporations is based on the |
| business requires its own plan. So many entrepreneurs | | | | purpose of the organization, who the owners are and |
| set out enthusiastically on an idea, without thinking | | | | the best advantages for them in avoiding liability and |
| through the elements for success. Charting a business | | | | benefiting from profits or losses. |
| strategy requires knowledge of the: | | | | The products and services of new businesses are |
| Corporate structure | | | | central to the success of those businesses. They must |
| Purpose of the entity | | | | be: |
| Goals of the owners | | | | Appealing products and services |
| Will the corporate structure be a C-corp, and S-corp, a | | | | Priced competitively for the customers |
| partnership, a limited liability corporation, or a non profit | | | | Reliable, beneficial and fulfilling |
| entity? There are reasons why one or the other is | | | | Assets for any business are products and services |
| best for you. The C-corp is the common stock | | | | that are in demand. The process of creating demand |
| corporation that has stockholders, pays taxes on | | | | for a product or service is slower, more intensive and |
| profits and pays dividends on those profits to the | | | | more expensive. The more appeal the product has the |
| stockholders. The S-corp is owned by individuals, not | | | | faster it will fly off the shelves. Understanding the |
| corporations, passing all profits or losses to the | | | | competition is critical in positioning your product so it will |
| stockholders. The partnership limits the liability of the | | | | move. And having a higher price on a product is not |
| owners and pays them profits. The limited liability | | | | necessarily a hindrance to success. A better marketing |
| corporation can be owned my individuals and | | | | strategy can make up for cheaper prices. |
| companies, passing through profits and losses without | | | | |