In these economically challenging times, when family members are struggling with increasing costs and increasing unemployment rates, it is imperative that consumers have the means to purchase goods and services they need without having to rely on their families’ income. Family-Owned Businesses (FOBs) provide the consumer with the ability to buy products and services that do not depend on the income of their family members. They provide consumers with a way to own a small business that provides a solid profit for the family members, and they provide a secure source of income for their children.
A family-Owned Business has many advantages to both the consumer and the company. As an owner of a small business, the consumer enjoys greater flexibility and control over their finances. They also enjoy greater control over the business and can exercise more control over their employees. The benefits to the business are clear: profits increase and business stability increases.
Many families invest in their small family business because it provides a form of income to help them provide for their family. However, many small family-Owned Businesses still face serious difficulties, due to financial difficulties, family conflict, and the economic downturn.
Many family-Owned Small Businesses operate as a sole proprietorship. This means that the owner owns the business, but does not hold a majority share of the business. Although not necessarily immoral, most family-Owned businesses are still de facto unreliable or moral.
Many of these smaller family-Owned Small Businesses are in reality sole partnerships. Many family-Owned Businesses have been set up through a business corporation, which allows the owner to maintain a high degree of ownership interest, while still taking advantage of the tax advantages and other benefits offered to business owners. Because of the fact that there is no general partnership registration required in most states, the owner can choose to keep his ownership interests separate from the business.
Family-Owned Businesses that are not in fact family owned but have been formed as a sole proprietorship can be run in several ways. Some families operate the business themselves, while others delegate managerial duties and hire others to manage certain departments of the business. Others operate the business out of state, such as in Europe or China.
The disadvantages of owning a sole proprietor are numerous, including: the possibility of defaulting on loans, having to deal with the personal conflicts of business disagreements, the inability to take risks, and being forced into a lower tax rate by state laws. In addition, owning a sole proprietor business can leave the owner vulnerable to lawsuits brought on by customers or employees. It can also leave the owner open to the potential losses incurred when the business takes a wrong turn. Even if the owner is able to avoid these risks, the owner may still be at risk of losing the assets in the case of bankruptcy, which can lead to severe financial difficulties.
Owning a business that provides a solid profit for the family allows the family to remain financially secure. It provides the family with additional opportunities to contribute financially to the business and build a good reputation for the business. It is a win-win situation for all involved.