ENTR FPX 5412 Assessment 1 New Business to Consider

Student Name

Capella University

ENTR-FPX5412 New Ventures and Entrepreneurship

Prof. Name

Date

Starting a New Business

Commencing a new business offers numerous advantages, such as being one’s own boss, reaping rewards from success and growth, and enjoying flexibility in working hours. As a self-employed entrepreneur, the autonomy to control one’s destiny is a key benefit [Williams, n.d., p. 1033]. The potential rewards may stem from the success and growth outlined in the business plan, showcasing the entrepreneur’s achievement in creating a new venture. Additionally, the flexibility of working hours, while requiring initial hard work, becomes more pronounced as the business flourishes [Williams, n.d., p. 1033].

However, it is crucial to consider associated risks, including startup costs, the competitive marketplace, and personal strengths and weaknesses. Entrepreneurs should assess their suitability for self-employment, evaluate startup costs, and research the marketplace to ensure a competitive edge over rivals [Williams, n.d., p. 1033].

Buying an Existing Business

When purchasing an existing business, one inherits established customers and a reputation, making the process less risky. The benefits include a proven concept, existing relationships, and a clear focus on building upon previous accomplishments [IBBA, n.d., p. 1033]. Despite these advantages, there are potential risks, such as immediate changes, a pre-existing bad reputation, and challenges in personalizing the business. Entrepreneurs must carefully evaluate these factors before acquiring an existing business, particularly if it is facing difficulties in the market [IBBA, n.d., p. 1033].

Buying a New Franchise

Starting a new franchise offers substantial benefits, such as a support and education system, lower risk, and a loyal customer base with brand recognition [Review, n.d., p. 1033]. The reduced risk is attributed to the backing of a larger corporation, providing access to an established customer base. However, risks include high initial investment, limited creativity, and shared financial information [Review, n.d., p. 1033].

Which Model Suits You Better

For our woodwork business, we envision starting a new business. Our personalized creations, catering to the western and rustic theme, target a wide market. As a small business, we aim to build a customer base through family and friends, leveraging our creativity and personalized approach.

Legal Structure of New Business

Considering taxes, limitation of personal liability, ease of transferability, and investor expectations, we opt for a Limited Liability Company (LLC) for our sole proprietorship [Katz, 2014, p. 1033]. While liability is a concern, we plan to address legalities and potential employees once our business expands.

Conclusion

Starting a new business involves careful consideration of risks and benefits. With an educational foundation, we plan to focus on market research, product quality, and client base expansion. Establishing a legal structure is crucial, and our progression to a storefront will be guided by our business plan and market analysis. While existing businesses and franchises offer advantages, our preference for creativity and individuality aligns with our chosen entrepreneurial path. Our business plan aims to bring enjoyment to clients through unique, creative projects.

References

IBBA. (n.d.). What are the benefits of buying a business instead of starting one? Retrieved from International Business Brokers Association: https://www.ibba.org/buying-vs-starting-abusiness/

Katz, A. (2014, August 13). Determining the Best Legal Structure for Your Business. Retrieved from Entrepreneur: https://www.entrepreneur.com/article/236450

Review. (n.d.). The Pros and Cons of Buying a Franchise: Is it Right for You? Retrieved from FranchiseBusinessReview: https://franchisebusinessreview.com/post/franchiseadvantages-disadvantages/

Williams, M. (n.d.). Benefits of Starting a Business. Retrieved from Wolters Kluwer: https://www.bizfilings.com/toolkit/research-topics/launching-your-business/benefits-ofstarting-a-business

ENTR FPX 5412 Assessment 1 New Business to Consider