EC 3025 – Synchronous Activity 1(Tutorial)
Problem Type Question
Dean is a successful sole practitioner offering business consultancy services to a number of local companies. His chief competitor is Caroline, who offers similar services. Caroline and Dean decide that they wish to work together, but are unsure as to which business structure would be most appropriate. They seek your advice regarding which business structure would be most suitable, bearing in mind:
They wish to avoid significant levels of formality and regulation
They want to have flexibility in establishing the procedures by which the business is to be run
They want to be able to run their affairs in private
They want to avoid personal liability for the debts and liabilities of the business
The process of creating the business should be relatively cheap and quick
They do not want to invest significant amounts of their own capital in setting up the business and will probably wish to Taise capital from outside sources
They wish to take on employees.
Discuss to what extent the various business structures fulfill all, or some, of the above aims and advise Dean and Caroline which business structure would be most suitable for their business.
