In this case we are presented with Shania, a Christian lady who wishes to set up a coffee shop. She deems that her business operate based on Christian values and principles. However, to make that happen, she has to make a number of critical considerations on what will best suit her enterprise.
On paper, formation of a business is usually portrayed as an easy endeavor. However, the actualization of the idea is quite challenging. This is because of the many fine details involved in between ranging from the business name, type of business, number of employees and even at times, integration of the owners personal norms and beliefs into the business. Here, I have commented on the business form, corporate name information, and her choice of employees considering her staunch Christian beliefs.
When considering the type of a business to start, there a number of options to choose from. They include; sole proprietorship, general partnership, limited partnership, corporations, limited liability companies, and cooperatives. Their differences arise from their organizational structure and also size. It would be in Shania’s best interests to go for the general partnership. Why?
Foremost, her husband has agreed to help her with the startup capital. Although he insists on having minimum participation in the business, this in its own qualifies him as a partner. On the contrary, if the other party was not his husband, I would advise differently say, limited partners. This is because both directors have a financial obligation towards each other; they should act in the organizations best interests as a whole rather than for their own. General partnerships are nontransferable and limited to the life of partners. This business form can easily be defined as an agreement between two or more people who want to undertake business together. It correlates with marriage intensely. Marriage can be defined as an agreement between two people who run a family together. In general partnerships, the company’s roles are also shared equally. This includes all the profits and losses. This realization presents the first and only demerit associated with this choice since Shania’s husband chooses not to be involved in the businesses daily functions. More reason to support this choice of business includes the fact that; they require very little paperwork, have a simple structure, are easy to dissolve, have pass through taxation and profit procedures just to name but a few.
Shania, who is looking to open a Christian coffeehouse near Denver, considered setting up her coffeehouse as a franchise but the ramifications accompanied by it, changed her mind. Her best option would be to open it as an independent coffee house.
This is owed to the following factors;
- In franchising, she requires more investment capital, since there are additional costs in buying an already established and reputable brand name.
- She has less control over her business operations since she would have to consult with the franchise when it comes to major decisions involving the brand.
- Franchising involves hefty paperwork and follow up from the government e.g. the development of a disclosure document among other regulatory documents.
Shania has decided that she wants to name her coffee shop “The Gathering Place”. Upon research of this company name, I found out that it was not available for use in the state since it was already being used by other businesses including churches. I also checked to see whether it was available as a trade mark and realized that this process was a little bit detailed since it requires her to fill in her company description and other minor details only she would know about. Though unavailable, her choice of name was a little dissatisfying on my part. I would have preferred a more intimate name like “Shania’s Coffee Haven”
Additionally, I would advocate for Shania to register her company as a trade mark since it would go a long way in safeguarding her rights as the business owner, reducing copycat products and even in the case where she uses a “special recipe” for her coffee ensure that it would always remain legally bound to her coffee shop alone.
When it comes to whom to have in her business either as an associate or as an employee, Shania is faced by a very delicate judgment call. Her husband should be the only partner in order to improve the cohesiveness of their relationship since introducing third parties may bring divided loyalties during decision making.{(Proverbs 31:11-12), (Malachi 2:14)}. This may have a detrimental effect on the shops performance. Her sister should be allowed to work there since she also represents the Christian values the business is forged upon. Also bearing in mind that this is a startup company, she may be the only willing and dedicated employee to work there during its infancy till it stabilizes and is able to properly remunerate its workers. Carlos who is a non-believer, I am of the opinion that she employs him. In the bible Paul encourages Christians to work with non believers though not to be equally yoked with them. {(1 Corinthians 10-25), (2 Corinthians 6:14-18)}
Employing Carlos will also open doors to people from all denominations portraying Carlos as an ambassador for the non believers which will in turn go a long way to grow her company’s target audience.
REFERENCES;
- Kubasek, N. K., Brennan, B. A., & Browne, M. N. (1996). The legal environment of business: A critical-thinking approach. Upper Saddle River, NJ: Prentice Hall.
- Colorado.gov. (n.d.). Retrieved May 15, 2016, from https://www.colorado.gov/apps/jboss/cbe//start-business.xhtml
- U.S. Small Business Administration | The U.S. Small Business Administration | SBA.gov. (n.d.). Retrieved May 15, 2016,