This paper will focus on a business situation while focusing on a single business entity and discussing the current business environment and emphasizing on business strategies and recommendations. The current and future business strategy will address factors such as liability, financial, legal, and the span of control of all members involved in the business entity while ensuring a successful and profitable venture for all vested parties involved in the facilitation of the business. The business entity that will be discussed is Joe's Landscaping Service and will address the above factors.
Joe is operating a small lawn care business as a sole proprietor. His current assets amount to $25,000, this includes his equipment and his truck. Joe also has three full-time employees. Joe is responsible for their salary and tax deductions. The labor laws are different in every state, so Joe must know the current law in the state he resides.
Lawn care is some areas may be seasonal, Joe must also know how to budget for the winter months when the work is slow. He may have to pay unemployment tax for his employees when they are not working. Currently, Joe's wife is taking care of the books. She has not been involved in any of the daily business operations. Without proper accounting experience and knowledge of the current tax laws, she might not know how Joe can benefit from certain business incentives. Aside from the lawn care portion of Joe's business; he also manages a small equipment rental service. This side of the business carries extremely high liability. Joe needs to have proper rental agreement and contracts reviewed regularly.
A sole proprietorship can offer Joe some protection, but not as much as if his business were organized as a Limited Liability Corporation (LLC). A LLC protects Joe's personal assets...