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BMS CTE single proprietorship

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									COURSE               6208 Exploring                   Unit A   The Nature of Business,
                     Business, Marketing                       Economics and Entrepreneurship
                     and Entrepreneurship
COMPETENCY           1.00         B2                  13%  Understand principles of
                                                           business.
OBJECTIVE            1.01          B2            6%        Understand the purpose and
                                                           functions of business.
ESSENTIAL                   Why do people start businesses?
QUESTIONS                   What are examples of activities that businesses perform?

                                     UNPACKED CONTENT
   I. Sole Proprietorship
      A. Owned by one person
      B. Advantages
         1) Easy to start
         2) Owner is his/her own boss
         3) Owner keeps all profits
      C. Disadvantages
         1) Owner must pay for everything needed for the business.
         2) Difficult to obtain capital needed to start business.
         3) Owner might lack business skills.
         4) Unlimited liability—owner has full responsibility for company's debts and can lose
            entire investment as well as personal assets.
      D. Examples
         1) Floral shops
         2) Bookstores
         3) Farms

   II. Partnership
       A. Owned by two or more people.
       B. Advantages
          1) Relatively easy to start
          2) Easier to obtain capital than in a sole proprietorship
          3) Partners share different skills and talents.
          4) Partners share the risks of the business.
       C. Disadvantages
          1) Partnership agreement is needed to start the partnership.
          2) Partners might not get along.
          3) Partners must share the profits.
          4) Partnership must be reorganized if one partner quits.
          5) Partners share unlimited liability—all partners share the responsibility of a bad
             decision made by one partner (including debts).
       D. Examples
          1) Law firms
          2) Medical practices
          3) Tom and Ray's Auto Body Repair

   III. Corporation
6208 – Exploring Business, Marketing and Entrepreneurship             2008
Page 28
       A. Owned by many people (stockholders), but treated by law as one person
          (corporation can own property, pay taxes, make contracts, etc.)
       B. Advantages
          1) Corporations can raise money by selling stock.
          2) Limited liability—stockholders can only lose what they have invested.
          3) Corporation continues when stockholders sell shares of stock.
          4) Corporation may make money by selling more shares of stock.
       C. Disadvantages
          1) Corporations are taxed on their profits.
          2) Government closely regulates corporations.
          3) More difficult to start a corporation because they must obtain a corporate charter
             from the state in which headquarters is located.
       D. Examples:
          1) Nike
          2) IBM
          3) Google
       E. Multinational Corporation - A corporation that has its facilities and other assets in at
          least one country other than its home country.
          1. Such companies have offices and/or factories in different countries and usually
             have a centralized head office where they coordinate global management.
          2. Examples are Coca-Cola, Wal-Mart, AOL, Toshiba, Honda and BMW.

   IV. Franchise
       A. Contractual agreement between the parent company (franchisor) and the franchisee
          (business operator) to sell a company's products or services in a specific geographic
          area
       B. Advantages
          1) Easy to start
          2) Franchisee can rely on the good name and expertise of the parent company.
          3) Franchisee can get help from the proven methods of the franchisor—especially
             good if franchisee lacks experience.
       C. Disadvantages
          1) Some franchisors are strict about how the business is run.
          2) Franchise is limited in what products or services can be sold.
          3) Franchise must operate like every other franchise.
       D. Examples
          1) Taco Bell
          2) Blockbuster
          3) McDonald's




6208 – Exploring Business, Marketing and Entrepreneurship         2008
Page 29
                                  INSTRUCTIONAL ACTIVITIES
                  ACTIVITIES               RELEVANCY TO OBJECTIVE               RESOURCES
1.    Business Ownership—How              This activity will interest the    Teacher website
      Sweet it Can Be! Activity           students in learning more about    http://www.econedli
       Visit both the teacher website    three of the four major forms of   nk.org/lessons/inde
         and the student website at the business organization, and the       x.cfm?lesson=EM5
         right prior to beginning the     advantages and disadvantages       33&page=teacher
         lesson.                          of each form. The candy
       If desired, duplicate the "Sweet kisses and the title of the         Student website
         Opportunities" case sheet for    activity will engage the           http://www.econedli
         the students from this site:     students' interest in this         nk.org/lessons/inde
         http://www.econedlink.org/less objective. The students will         x.cfm?lesson=EM5
         ons/EM533/em533_Sweet_Op learn about sole                           33
         portunities.swf.                 proprietorships, partnerships,
       Work through Lesson 1 with        and corporations by exploring      Small bag of
         the students, facilitating class the websites given in the          Hershey's kisses.
         discussion as the students       activity, and by discussing the        OR
         view the website.                case studies with their            Stickers with
       Divide class into small groups    classmates. The activity is        pictures of "sweet
         for Lesson 2. Each group         designed to promote student        treats" (optional).
         should have a:                   interest in this objective.
          Leader/facilitator
          Recorder
          Reporter
          Time keeper/task master
       Assign each group of students
         two of the cases to study and
         make recommendations.
         Allow students approximately
         15 minutes to complete their
         case studies. Circulate and
         offer assistance as needed.
       When the groups have
         completed their cases, have
         each group reporter report on
         the recommendations made by
         the group for each case.
         Facilitate class discussion as
         the students report.
         (Discussion suggestions are
         given at the teacher website at
         the right.)
       Reward students with a
         Hershey kiss (if allowable) at
         the conclusion of the activity—
     6208 – Exploring Business, Marketing and Entrepreneurship     2008
     Page 30
                                  INSTRUCTIONAL ACTIVITIES
                  ACTIVITIES              RELEVANCY TO OBJECTIVE                       RESOURCES
          stickers with "sweet treat"
          pictures may also be used.


2.    PowerPoint Presentation                   When the students take notes         1.02 Cornell Notes
       Distribute the 1.02 Cornell             using the Cornell Notes format,
         Notes handout to students and          they will be more focused on         1.02—Types of
         have them taken notes on the           the content of the PowerPoint        Businesses
         form during the PowerPoint             and have a way to organize the       PowerPoint
         Presentation. You may have             important concepts. Students
         to explain the concept to the          will be able to keep their page      http://www.scoe.org
         students. Information about            of notes for reference as they       /content.php?PageI
         Cornell Notes can be found at          progress through the activities      d=535 (Information
         the Sonoma County AVID                 in the objective. Having             for teachers about
         website                                concepts about each of the four      Cornell Notes)
         http://www.scoe.org/content.ph         forms of business organization
         p?PageId=535.                          in one chart will help the
       Facilitate as students view the         students be able to COMPARE
         1.02—Types of Businesses               (B2) the forms more easily.
         PowerPoint presentation .
       Ask several students to share
         their summary after viewing
         the PowerPoint presentation.



3.    Own Your Own Business                     This activity will allow students    1.02 Own Your
       Distribute the 1.02 Own Your            to be creative while helping         Own Business
        Own Business activity to                them better UNDERSTAND
        students.                               (B2) that the sole proprietor is     1.02 Own Your
       Explain to the students how             responsible for all the activities   Own Business
        important marketing or                  of the business (a                   Grading Rubric
        promoting the business (from            disadvantage of a sole
        Objective 1.01) is for a sole           proprietorship). This activity
        proprietorship.                         connects forms of business
       Ask students to think about the         organization (Objective 1.02) to
        sole proprietorship they would          what the students learned in
        like to create. Have them list          Objective 1.01 about the
        the required items on the first         functions of business.
        page of the activity for
        homework and bring it to class,
        ready to create their flyer and
        business card.
       Allow students time to work on

     6208 – Exploring Business, Marketing and Entrepreneurship             2008
     Page 31
                                 INSTRUCTIONAL ACTIVITIES
                   ACTIVITIES              RELEVANCY TO OBJECTIVE                    RESOURCES
          their flyer and business card in
          class. Circulate and offer
          assistance as needed.
          (Teachers may need to give
          students a template for the
          business card and the flyer.)


4.    Project Partnership                       This activity will give help      1.02 Project
       Duplicate the 1.02 Project              students better UNDERSTAND        Partnership Activity
         Partnership activity sheets            (B2) the risks and rewards of
         and sample partnerships prior          organizing a business as a        Box or "hat" with
         to the start of class.                 partnership. By working with a    individual sample
       Cut the sample partnerships             partner, students will gain a     partnership
         into individual rectangles so          better grasp of the concept of    businesses (from
         students can "draw" a                  partnerships in business by       the activity listing)
         business for the activity.             helping them see an advantage     for students to
       Distribute the 1.02 Project             to a partnership—sharing skills   select for the
         Partnership activity sheets to         and talents.                      activity.
         the students.
       Have students work in pairs to
         complete the activity. Each
         pair will draw a partnership.
       Circulate and assist as
         needed.
       At the conclusion of the
         activity, have students report
         their decisions to the class.
         Facilitate a class discussion.




5.    Famous Corporations                       This activity will interest       1.02 Famous
       Distribute the 1.02 Famous              students in learning more about   Corporations
         Corporations activity to               corporations as they explore
         students.                              the Hoovers website. The          www.hoovers.com
       Students may work in pairs or           students will be able to relate
         individually.                          the study of corporations to      1.02 Famous
       Students will visit the                 businesses with which they are    Corporations Key
         www.hoovers.com website to             familiar. Students will
         complete the activity chart.           COMPARE (B2) the activities,
       Assist students as needed.              risks and rewards of
       Facilitate a class discussion at        corporations with those of
     6208 – Exploring Business, Marketing and Entrepreneurship          2008
     Page 32
                                  INSTRUCTIONAL ACTIVITIES
                   ACTIVITIES              RELEVANCY TO OBJECTIVE                    RESOURCES
          the conclusion of the activity.  partnerships and sole
          (If a corporation has a negative proprietorships and to see
          net income, explain to the       some major differences.
          students that the corporation
          had a net loss and discuss
          possible reasons.)




6.    Framework of a Franchise                  This activity will further the     1.02 Framework of
       Distribute the 1.02 Framework           students understanding of          a Franchise
         of a Franchise activity to             franchises—the requirements,
         students.                              the benefits, and the risks. In    www.entrepreneur.
       Students may work individually          selecting one of the top           com/franchise500/i
         or in pairs.                           franchises, students will be       ndex.html
       Students will select one of the         better able to relate to this
         franchises on the 2007                 popular form of business           1.02 Framework of
         Franchise 500 for the activity.        organization, which will help      a Franchise
       Students will use the website           them be able to COMPARE            Grading Rubric
         www.entrepreneur.com/franchi           (B2) franchises to the other
         se500/index.html to complete           forms of business organization.
          the activity.
         Circulate and offer assistance
          as needed.
         At the conclusion of the
          activity, have students report
          their findings to the class.
         Facilitate a class discussion.

7.    Categorizing By Types of                  This activity will help students   1.02 Categorizing
      Businesses                                review the concepts of the four    By Type Business
       Distribute the 1.02                     major types of business
         Categorizing By Type                   organization that they have        1.02 Categorizing
         Business activity to students.         learned—sole proprietorship,       By Type Business
       Have students classify each             partnership, corporation and       Activity Key
         business listed as a sole              franchise. Classifying the
         proprietorship, partnership,           businesses will help the
         corporation, or franchise.             students better UNDERSTAND
         Students may use previous              (B2) the concepts.
         activities, notes, and the
         Internet for the activity.
     6208 – Exploring Business, Marketing and Entrepreneurship           2008
     Page 33
                                 INSTRUCTIONAL ACTIVITIES
                  ACTIVITIES             RELEVANCY TO OBJECTIVE                        RESOURCES
         Circulate and offer assistance
          as needed.

8.    Comparing Business                        This graphic organizer will give    1.02 Comparing
      Organizations                             the students a visual aid to        Business
       Distribute the 1.02 Comparing           assist them to COMPARE (B2)         Organizations
         Business Organizations                 the four major forms of
         activity to students.                  business organization by listing    1.02 Comparing
       Have students work in pairs to          the advantages and                  Business
         complete the activity.                 disadvantages of each system        Organizations KEY
       When students have                      in a visual format.
         completed the activity,
         facilitate a class discussion of
         the activity.

9.    Forms of Business Organization            This activity will allow the        1.02 Forms of
      Comparison                                students to review the forms of     Business
       Distribute the 1.02 Forms of            business organization and           Organization
         Business Organization                  COMPARE (B2) them by listing        Comparison
         Comparison activity to                 similarities and differences in a
         students.                              chart format. The chart format      1.02 Forms of
       Teachers may wish to print the          will help the students easily see   Business
         graphic organizer and                  the similarities and differences    Organization
         distribute it to the students, OR      among the four forms of             Comparison KEY
         to distribute the file                 business organization.              http://www.sba.gov/s
         electronically for the students                                            mallbusinessplanner/
         to complete.                                                               start/chooseastructur
       Students may refer to the                                                   e/START_FORMS_O
         website at the right for a                                                 WNERSHIP.html
         review of forms of business
         organization.




     6208 – Exploring Business, Marketing and Entrepreneurship            2008
     Page 34
              INSTRUCTIONAL SUPPORT
                    MATERIALS




6208 – Exploring Business, Marketing and Entrepreneurship   2008
Page 35
Name: ______________________________________                Class: _____________

1.02 Cornell Notes

Cue Column                            Note-taking Column
Sole Proprietorship



   Examples




   Advantages




   Disadvantages




Partnership



   Examples




   Advantages




   Disadvantages




6208 – Exploring Business, Marketing and Entrepreneurship         2008
Page 36
Name: ______________________________________                Class: _____________

Corporation



   Examples




   Advantages




   Disadvantages




Franchise



   Examples




   Advantages




   Disadvantages




6208 – Exploring Business, Marketing and Entrepreneurship          2008
Page 37
Name: ______________________________________                Class: _____________


                             1.02 Own Your Own Business
                                  Sole Proprietorship Activity

   1. Brainstorm a business that you would like to create and run
      own your own as a sole proprietorship. You can use the list
      provided or create one on your own.

   2. Create a flyer and a business card in a word processing or
      preferably a desktop publishing software (such as MS
      Publisher) using the following directions:

               For the flyer- the purpose of flyer should be to advertise
               your business in a creative way so that consumers want
               to buy it. Use a “hook” to get the attention of the reader.
                     -   Name of Business
                     -   Description of products or services offered (you may want to include
                         prices depending upon your business)
                     -   Company logo and/or motto
                     -   Location (and possibly directions or map)
                     -   Hours of Operation (For example- 8-5 M-F)
                     -   Contact info such as: your name, phone number, address, e-mail
                         address, and website.
               For the business card
                     -   Company Name and logo and/or motto
                     -   Contact Name
                     -   Phone #
                     -   Address
                     -   Website address
                     -   E-mail address

   3. Post advertisements in your classroom and hand out your
      business cards.



6208 – Exploring Business, Marketing and Entrepreneurship           2008
Page 38
Name: ______________________________________                Class: _____________




6208 – Exploring Business, Marketing and Entrepreneurship          2008
Page 39
Name: ______________________________________                Class: _____________

                             1.02 Own Your Own Business
                               Sole Proprietorship Activity
                             Examples of Sole Proprietorships

Several examples of sole proprietorships are listed below. You may select one
of these businesses, or another business that interests you (with teacher
approval).

      Artist
      Bakery
      Barber shop
      Beauty shop
      Book store
      Café
      Dance studio
      Lawn care business
      Local carpenter
      Local clothing store
      Local construction company
      Local dry cleaners
      Local photographer
      Local restaurant
      Local surf shop
      Pet sitting business
      Small engine repair shop
      Tae Kwon Do studio
      Tailor/seamstress
      Web design business




6208 – Exploring Business, Marketing and Entrepreneurship          2008
Page 40
                     1.02 Own Your Own Business Grading Rubric
Student’s Name ________________________ Class Period _____
                                                            Max # of points      Total Points Given
   Flyer
               Name of business                                    5
               Description of products or                         10
                services offered
               Company logo and/or motto                           5
               Location (and possibly                              5
                directions or map)
               Hours of operation                                  5
               Contact Information                                10
                 Name
                 Phone number
                 Address
                 E-mail address
                 Website
               Appearance                                          5
           Correct spelling/grammar                               10
   Business Card
           Company name and logo                                   5
             and/or motto
               Contact name                                        5
               Phone number                                        5
               Address                                             5
               Website address                                     5
               E-mail address                                      5
               Appearance                                          5
               Correct spelling/grammar                           10
   TOTAL POINTS                                                   100
Comments:


6208 – Exploring Business, Marketing and Entrepreneurship                     2008
Page 41
Name: ______________________________________                Class: _____________

                               1.02 Project Partnership
   A partnership is a type of business in which partners share with each other the profits or
   losses of the business undertaking in which all have invested.

   Directions: Choose a partner. You and your partner are going to draw a business out of
   the hat and make plans to open that business by answering the following questions.

               What kind of products or services will you sell?



               What is your business name?



               Who will buy your products or services? (Adults, teens, children, etc.)



               Where will your business be located (in your home, a shopping mall, on the
               Internet, a shopping center, etc.)?



               What skills will each of you bring into the partnership?



               How will you advertise your products?



After answering the questions with your partner, consider the following in a class
   discussion.

               How did you feel discussing these questions with your partner?
               What are some of the compromises you worked out?
               Do you think it will be easier financially to have two people starting a
               business as opposed to one? Why or why not?
               If your partnership is forced to file bankruptcy, who will be liable to pay the
               past due bills?
               Why should partnerships have an agreement before they start?



6208 – Exploring Business, Marketing and Entrepreneurship            2008
Page 42
1.02 Project Partnership
Sample Partnerships


Law Firm                            Restaurant              Cleaning Business


Landscaping                         Clothing Store          Tutoring Service


Tax Preparation                     Computer Repair         Medical Office


Automobile Repair                   Hair Salon              Graphic Design


Video Arcade                        CD Store                Catering Business


Home Repair                         Bicycle Repair          Bakery


Dry Cleaners                        Counseling Services Furniture Store


Dentists Office                     Book Store              Pizza Parlor


Jewelry Store                       Photography Studio      Dance Instruction


Child Care Center                   Flower Shop             Karate Instruction


6208 – Exploring Business, Marketing and Entrepreneurship     2008
Page 43
Name: ______________________________________                 Class: _____________




Complete the chart by researching corporations using the Hoovers website www.hoovers.com use the search bar of this site to search
and find information on each company.


  Ticker             Company Name                      CEO      Net Income (Last      Product or Service           1 Top
  Symbol                                                              Year)                Offered               Competitor
1. MSFT

2. KO

3. NKE

4. XOM

5. WMT

6. BAC

7. GM


After completing the chart, please list the characteristics of a corporation on the lines below:
________________________________________________________________________________________________________________________
________________________________________________________________________________________________________________________
________________________________________________________________________________________________
6208 – Exploring Business, Marketing and Entrepreneurship          2008                          Page 44
Answers may vary. (Answers as of 9/1/2007 are given)
Complete the chart by researching corporations using the Hoovers website www.hoovers.com use the search bar of this site to search
and find information on each company.

  Ticker             Company Name                     CEO           Net Income (Last     Product or Service         1 Top Competitor
  Symbol                                                                  Year)               Offered
1. MSFT         Microsoft Corporation          Steven Ballmer      $14,065 million     Computer Software           Google, IBM

2. KO           Coca Cola Company              E. Neville Isdell   $5,080 million      Soft drinks.                PepsiCo, Nestlé

3. NKE          Nike, Inc.                     Mark G. Parker      $1,491.5 million    Shoes, athletic shoes.      Adidas, New Balance

4. XOM          Exxon/Mobil Corporation        Rex W. Tillerson    $39,500 million     Oil and gas—fuel.           BP, Chevron, Shell

5. WMT          WalMart Stores,                H. Lee Scott, Jr.   $11,284 million     Discount department         Costco, Target
                Incorporated                                                           (warehouse) retail
6. BAC          Bank of America Corp.          Kenneth D. Lewis    $21,133 million     Banking, investments,       Citigroup, Wachovia,
                                                                                       credit cards                Wells Fargo
7. GM           General Motors Corp.           Richard Wagoner, ($1,978) million **    Cars and trucks             Daimler Chrysler,
                                               Jr.                                                                 Ford Motor, Toyota

After completing the chart, please list the characteristics of a corporation on the lines below:
__Corporations are owned by stockholders. Corporations can make more money by selling more stock. Corporations have a formal
legal structure. Corporations are led by the CEO and or Chairman of the Board._________________________________________


6208 – Exploring Business, Marketing and Entrepreneurship                2008                            Page 45
Na Name: __________________________                  Class: _____________
                                    1.02 Framework of a Franchise



A Franchise is a right granted by a manufacturer to a distributor to
distribute their products. Note franchises can be exclusive in that no
one else may be given the right to sell the same products in the same
territory or they may not.




Use the list of top American Franchises in 2007, www.entrepreneur.com/franchise500/index.html, and
answer the following questions concerning one franchise of your choice from the list.
     1. What is your franchise name?


     2. What year did the company began?


     3. What year did the franchising begin?


     4. Who is the franchisor, and how many employees does it have?


     5. What was the number of U.S. franchises in year 2006? Did 2006 experience growth in the
        number of U.S. franchises since 2005?


     6. List some special programs in which the company participates.


     7. What is the franchise fee?


     8. What is the ongoing royalty fee?


     9. What are the terms of agreement?


     10. List three qualifications to own this franchise.


     11. What type of support is provided by the franchisor?



6208 – Exploring Business, Marketing and Entrepreneurship               2008
Page 46
Name: ______________________________________                    Class: _____________

     12. How does this franchise rank according to other franchises?




6208 – Exploring Business, Marketing and Entrepreneurship              2008
Page 47
Name: ______________________________________                         Class: _____________

                                           Top American Franchises
1.02 Framework of a Franchise
2007 Franchise 500
           Franchise Name/Description                                                 Startup Costs
  Rank
    1      Subway Submarine sandwiches & salads                                       $74.9K-222.8K
    2      Dunkin' Donuts Donuts & baked goods                                         $179K-1.6M
    3      Jackson Hewitt Tax Service Tax preparation services                        $48.6K-91.8K
    4      7-Eleven Inc. Convenience store                                               Varies
           UPS Store, The/Mail Boxes Etc. Postal, business & communications          $153.95K-266.8K
    5
           services
    6      Domino's Pizza LLC Pizza, breadsticks, buffalo wings                      $141.4K-415.1K
    7      Jiffy Lube Int'l. Inc. Fast oil change                                      $214K-273K
    8      Sonic Drive In Restaurants Drive-in restaurant                               $861.3K
    9      McDonald's Hamburgers, chicken, salads                                      $506K-1.6M
   10      Papa John's Int'l. Inc. Pizza                                                 $250K
   11      RE/MAX Int'l. Inc. Real estate                                              $25K-199K
   12      InterContinental Hotels Group Hotels                                          Varies
   13      Jani-King Commercial cleaning                                              $11.3K-34.1K+
   14      Cold Stone Creamery Ice cream, Italian sorbet                             $294.3K-438.9K
   15      Curves Women's fitness & weight-loss center                                $31.4K-53.5K
   16      Century 21 Real Estate LLC Real estate                                     $11.8K-522.8K
   17      Liberty Tax Service Income-tax preparation services                        $33.4K-59.9K
   18      Ace Hardware Corp. Hardware & home improvement                               $600K-1M
   19      Midas Auto repair & maintenance services                                   $243K-329.7K
   20      Super 8 Motels Economy motels                                               $285K-2.8M
   21      Merle Norman Cosmetics -Cosmetics studio                                   $29.6K-165.4K
   22      Kumon Math & Reading Centers Supplemental education                        $30.5K-110K
   23      Jan-Pro Franchising Int'l. Inc. Commercial cleaning                         $3.3K-49.9K
   24      Matco Tools Tools                                                           $79K-182K
   25      Servpro Industries - Insurance/disaster restoration & cleaning             $97.3K-154.7K
   26      Hampton Inn/Hampton Inn & Suites Midpriced hotels                           $3M-10.5M
           Chem-Dry Carpet Drapery & Upholstery Cleaning Carpet, drapery &            $24.6K-203.6K
   27
           upholstery cleaning
   28      Days Inns Worldwide Hotels & inns                                           $391K-5.7M
   29      Budget Blinds Inc. Window coverings                                        $79.7K-153.1K
   30      Supercuts -Family hair care                                               $106.8K-197.9K




6208 – Exploring Business, Marketing and Entrepreneurship                     2008
Page 48
                  1.02 Framework of a Franchise Grading Rubric
Student’s Name ________________________ Class Period _____
                                                            Max # of points      Total Points Given

                 Franchise name                                   5

                 Year company began                               5

                 Year the franchising began                       5

                 Who is the franchisor?                           5

                 Number of employees the                          5
                  franchisor has

                 Number of U.S. franchises                        5
                  in year 2006
                   Was that growth from                           5
                  2005?

                 Special programs in which                        10
                  the company participates

                 Franchise fee                                    5

                 Ongoing royalty fee                              5

                 Terms of agreement                               10

                 Three qualifications to own                      15
                  this franchise

                 Type of support provided                         10
                  by the franchisor

                 Rank of this franchise                           5
                  according to other
                  franchises
     TOTAL POINTS                                                 100
Comments:



6208 – Exploring Business, Marketing and Entrepreneurship                     2008
Page 49
Name: ______________________________________                               Class: _____________
                                     1.02 Categorizing by Type of Business

Looking at the list below; read, decide, and write the name of each business in the correct column
(Sole Proprietorship, Partnership, Corporation, or Franchise).

Davie’s Dog Walking Service                                      Exxon Mobile
McDonald’s                                                       Balcor & Realty Investors
General Motors (GMC)                                             Brauvin Real Estate L.P.
Ford Motor Company                                               Papa John's Int'l. Inc
Winkler & Winkler Accounting Firm                                Fox Strategic Housing Income Partners
Pottery by Ashley                                                Richardson & Goins Medical Practice
Patty’s Party Planning                                           Betty’s Beauty Salon
Bank of America                                                  Subway
7-Eleven Inc                                                     Dunkin Donuts
Wal-Mart                                                         Cooke Construction

Sole Proprietorship              Partnership            Corporation                  Franchise




SOLE PROPRIETOR is someone who owns an unincorporated business by himself or herself.
If you're going into business on your own, the simplest legal structure is the sole proprietorship. A sole proprietor can
be held personally liable for any business-related obligation. This means that if your business doesn't pay a supplier,
defaults on a debt, or loses a lawsuit, the creditor can legally come after your house or other possessions. In the
eyes of the law, a sole proprietorship is not legally separate from the person who owns it.

PARTNERSHIP is a type of business entity in partners share with each other the profits or losses of the business
undertaking in which all have invested. A contract is made between individuals who, in a spirit of cooperation, agree
to carry on an enterprise, contribute to it, by combining property, knowledge or activities and to share its profit.
Partnerships are often favored over corporations for taxation purposes.

FRANCHISE - A business relationship in which an owner (the franchisor) licenses others (the franchisees) to operate
outlets using business concepts, property, trademarks and trade names owned by the franchisor. A franchise does
the following: 1. Sells a business opportunity to any person, 2. Allows the buyer to use your company name or logo;
3. Charges a fee to the buyer (inside or outside of product or service); 4. Provides any significant assistance or
maintain any significant control over any part of the business.

CORPORATION - A legal entity that is separate and distinct from its owners. Corporations enjoy most of the rights
and responsibilities that an individual possesses; that is, a corporation has the right to enter into contracts, loan and
borrow money, sue and be sued, hire employees, own assets and pay taxes.

6208 – Exploring Business, Marketing and Entrepreneurship                            2008
Page 50
                                  1.02 Categorizing By Type of Business KEY

Looking at the list below; read, decide, and write the name of each business in the correct column
(Sole Proprietorship, Partnership, Corporation, or Franchise).

Davie’s Dog Walking Service                                      Exxon Mobile
McDonald’s                                                       Balcor & Realty Investors
General Motors (GMC)                                             Brauvin Real Estate L.P.
Ford Motor Company                                               Papa John's Int'l. Inc
Winkler & Winkler Accounting Firm                                Fox Strategic Housing Income Partners
Pottery by Ashley                                                Richardson & Goins Medical Practice
Patty’s Party Planning                                           Betty’s Beauty Salon
Bank of America                                                  Subway
7-Eleven Inc                                                     Dunkin Donuts
Wal-Mart                                                         Cooke Construction

Sole Proprietorship              Partnership            Corporation                  Franchise
Davie’s Dog Walking Service      Winkler & Winkler      Bank of America              McDonald’s
                                 Accounting Firm
Pottery by Ashley                Balcor & Realty        Exxon Mobile                 Subway
                                 Investors
Patty’s Party Planning           Brauvin Real           Ford Motor Company           Dunkin Donuts
                                 Estate L.P.
Betty’s Beauty Salon             Fox Strategic          General Motors (GMC)         7-Eleven Inc
                                 Housing Income
                                 Partners
Cooke Construction               Richardson &           Wal-Mart                     Papa John's Int'l. Inc
                                 Goins Medical
                                 Practice

SOLE PROPRIETOR is someone who owns an unincorporated business by himself or herself.
If you're going into business on your own, the simplest legal structure is the sole proprietorship. A sole proprietor can
be held personally liable for any business-related obligation. This means that if your business doesn't pay a supplier,
defaults on a debt, or loses a lawsuit, the creditor can legally come after your house or other possessions. In the
eyes of the law, a sole proprietorship is not legally separate from the person who owns it.

PARTNERSHIP is a type of business entity in partners share with each other the profits or losses of the business
undertaking in which all have invested. A contract is made between individuals who, in a spirit of cooperation, agree
to carry on an enterprise, contribute to it, by combining property, knowledge or activities and to share its profit.
Partnerships are often favored over corporations for taxation purposes.

FRANCHISE - A business relationship in which an owner (the franchisor) licenses others (the franchisees) to operate
outlets using business concepts, property, trademarks and trade names owned by the franchisor. A franchise does
the following: 1. Sells a business opportunity to any person, 2. Allows the buyer to use your company name or logo;
3. Charges a fee to the buyer (inside or outside of product or service); 4. Provides any significant assistance or
maintain any significant control over any part of the business.

CORPORATION - A legal entity that is separate and distinct from its owners. Corporations enjoy most of the rights
and responsibilities that an individual possesses; that is, a corporation has the right to enter into contracts, loan and
borrow money, sue and be sued, hire employees, own assets and pay taxes.

6208 – Exploring Business, Marketing and Entrepreneurship                            2008
Page 51
1.02 Comparing Business Organizations

         Sole Proprietorship
                                                                                 Partnership
             Advantage;
                                                                                Advantage;




             Disadvantage:
                                                                                Disadvantage:




                                                               Types
                                                                Of
                                                             Business
                                                            Organization
         Corporation
                                                                                        Franchise
            Advantage;
                                                                                       Advantage;




            Disadvantage:
                                                                                       Disadvantage:




6208 – Exploring Business, Marketing and Entrepreneurship             2008                     Page 52
Name: ______________________________________                Class: _____________
1.02 Comparing Business Organizations

   1. Name some similarities between sole proprietorships and partnerships.




   2. Name some similarities between partnerships and corporations.




   3. Name some similarities between corporations and franchises.




   4. Name some similarities between partnerships and franchises.




   5. Name some similarities between sole proprietorships and franchises.




   6. What would be the safest form of business organization for a new, inexperienced business owner?



6208 – Exploring Business, Marketing and Entrepreneurship           2008                        Page 53
1.02 Comparing Business Organizations— KEY
Answers may vary.



        Sole Proprietorship                                                      Partnership
               Advantage:                                                      Advantage;
        Easy to start                                                        Relatively easy to start
        Owner keeps all of profits                                           Partners share skills and risks

               Disadvantage:                                                   Disadvantage:
        Difficult to obtain funding                                          Need Partnership Agreement
        Owner has full responsibility                                        Partners share profits




                                                               Types
                                                                Of
                                                             Business
                                                            Organization
                Corporation                                                             Franchise
               Advantage:                                                            Advantage;
            Can raise money by selling                                             Easy to start
            stock                                                                  Help from parent company
            Limited liability
                                                                                      Disadvantage:
               Disadvantage:                                                      Franchisor may be strict
            Taxed on their profits                                                 Limited in products or services
            Closely regulated by                                                   sold
               Government




6208 – Exploring Business, Marketing and Entrepreneurship             2008                        Page 54
   1.02 Comparing Business Organizations Key

   1. Name some similarities between sole proprietorships and partnerships.

   Both sole proprietorships and partnerships are easy to start



   2. Name some similarities between partnerships and corporations.

   Both partnerships and corporations have more than one owner.


   3. Name some similarities between corporations and franchises.

   Both corporations and franchises have to have written agreements prior to starting—a corporate charter for a corporation, and a
   franchise agreement (contract) for a franchise.


   4. Name some similarities between partnerships and franchises.

   In both partnerships and franchises, skills and talents needed to run the business can be shared—in the partnership by the partners,
   and in the franchise from the parent company. In both partnerships and franchises, the owners only receive part of the profits.

   5. Name some similarities between sole proprietorships and franchises.

   Both are easy to start.


   6. What would be the safest form of business organization for a new, inexperienced business owner?

   A franchise would probably be safest since the parent company (the franchisor) offers training and assistance in starting and
   running the business


6208 – Exploring Business, Marketing and Entrepreneurship           2008                            Page 55
1.02 Forms of Business Organization Comparison
List characteristics for each form of business organization as you respond to each question at the left.
Characteristics                  Sole                       Partnership     Corporation     Franchise
                             Proprietorship
Describe the
owners of this
form of
organization.
What special
paperwork is
necessary to start
this form of
business?
Is this form of
business easy or
difficult to start?

Who receives the
profit from this
form of business?

What are
examples of this
form of business?



6208 – Exploring Business, Marketing and Entrepreneurship            2008                 Page 56
1.02 Forms of Business Organization Comparison—KEY
List characteristics for each form of business organization as you respond to each question at the left.
Characteristics                  Sole                       Partnership           Corporation           Franchise
                             Proprietorship
Describe the               One owner                    Two or more             Many owners—         The owner is the
owners of this             business—the sole            owners—the              the stockholders     parent
form of                    proprietor                   partners                                     company—the
organization.                                                                                        franchisor.
What special               None, unless a               A partnership          A corporate           A franchise
paperwork is               business license is          agreement is needed charter must be          agreement must
necessary to start         required                     to start the business. completed and         be completed.
this form of                                                                   approved by the
business?                                                                      headquarters
                                                                               state.
Is this form of            Easy to start                Relatively easy to     Difficult to start    Easy to start
business easy or                                        start
difficult to start?
Who receives the           The single owner             The partners must       The stockholders     The franchisee
profit from this           receives all the             share the profits.      MAY share some       receives some of
form of business?          profits.                                             of the profit if a   the profits, but
                                                                                dividend is paid.    must pay some
                                                                                                     to the franchisor
What are          Floral Shops                          Law Firms               Nike                 Taco Bell
examples of this  Book Stores                           Medical Practices       IBM                  McDonald's
form of business?                                                               Google               Blockbuster
answers may vary

6208 – Exploring Business, Marketing and Entrepreneurship               2008                          Page 57

								
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