Are you looking to start your own Butcher business or expand your already existing butcher business? If so, it is important that you consider the effect your choice of business structure will have. Many business owners have difficulty choosing the best business structure for them, as all the combinations and permutations of business goals and the business structures available can be overwhelming. However, this need not be the case, for as you begin to decide which business structure is best for your business, you should focus only on the basics. After you have a basic understanding of each separate business structure available to you, it will quickly become apparent which ones will suit your needs, and which ones will not. Consequently, you will then be able to focus on the few structures that will work best for you, avoiding the quagmire in which other business owners find themselves. Finally, you will be able to take this shortlist to a legal professional to ensure you have not missed any legal implications that arise from your choice of business structure, and begin to create the masterpiece that will be your butcher business.
Should I choose a partnership business structure?
One example of a business structure you could choose for your butcher business is that of a partnership. A partnership allows you to pool your resources with other like-minded individuals or business owners. This can help to create a business that is more stable, reliable and financially secure than if you were to run the business by yourself. Such a structure would allow you to see off most competition in today’s competitive environment, and ease some of the strain you would experience if you were to choose something like a sole trader business structure. However, to form a partnership you will need to have complete faith in any partner you would choose.
The primary benefit of a partnership, as opposed to other business structure options such as a company, is that its administration is relatively cheap. Consequently, you do not have to worry about ASIC returns, statutory requirements to keep a register or costs associated with incorporation of a company. The result of this is that you can get a partnership up and running much quicker than other business structures. Also, partners can get a 50 per cent CGT discount that is not available to other structures. Finally, a partnership business structure provides considerable financial flexibility to partners, as profits are shared according to Partnership Agreement, and debt can be deducted against other income partners.
Should I choose a company business structure?
Instead of choosing the partnership business structure mentioned above, you could opt for a company structure for your butcher business. Incorporating allows you to be more aggressive in the running of your business, and poses a threat to many other butcher businesses in Australia. However, it is possible that the additional costs and regulations required to run a company under the law will hinder rather than help you.
The primary benefit of a company business structure is that any financial debt incurred by the company remains with the company. Therefore, unlike a partnership structure, there will be no personal financial risk for you when making business decisions. The price of this enormous benefit, however, is increased running cost, an inability to access profits directly and numerous legal requirements as to how the company is to be run. Consequently, this structure is recommended for a butcher business that is either already established or one with substantial finances and looking to expand quickly.
If you are looking to start you own butcher business or expand your already existing butcher business, it is important that you consider the effect your choice of business structure will have. Although partnership and company business structures are only two options available to you, they are a good place to start, as you begin to gain an understanding of all the structures from which you can choose. If you would like to see a list of some of these business structures, please click here. Finally, if you have any other questions relating to which business structure will best suit your business, please call LegalVision for a fixed-fee quote.