...family member’s experience and background, they need to respect any decision either of them make on their jobs. Another very important topic is stablishing how much money each of them are going to earn, and agreeing up-front how equity will be distributed. They need to have a clear and honest communication about how the business is running, so when changes are needed they have been identified with enough time and data. A good recommendation for this topic would be to have business meetings periodically. Conflict is inevitable, the key is whether you handle it well or allow it to destroy the business and/or the family. Conflicts should not be personalized. 2. Suppose that Cooper and Schwinoff had approached you when they were launching Zatswho concerning the form of ownership they should use. Which form of ownership do you recommend they use. Why? I would have recommended them to use Limited Liability Company (LLC).LLC is a hybrid entity that combines favorable aspects of the corporation and partnership. The LLC features pass-through taxation of the partnership, and limited liability of the corporation. I see it like this - the LLC is a partnership that offers the limited liability protection of a corporation. Or conversely, it's a corporation that's taxed like a partnership; very convient for Cooper and Schwinoff’s business. 3. Zatswho’s target Market Since the idea to produce photo flashcads came from Trish Cooper who is a 52 years old grandmother, the best target market...
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...CASE STUDY: WEEK 3 ZATSWHO LT CASE STUDY WEEK 3: Zatswho 1. What tips can you offer Cooper and Schwinoff about family members who start and run a business together? What pitfalls would you warn them to avoid? Answer: Suggestion for family members starting a business: “Successful copreneurs learn to build the foundation for a successful working relationship before they ever launch their companies. Some of the characteristics they rely on include: ■ An assessment of how well their personalities will mesh in a business setting ■ Mutual respect for each other and one another’s talents ■ Compatible business and life goals—a common “vision” ■ A view that they are full and equal partners, not a superior and a subordinate ■ Complementary business skills that each acknowledges in the other and that lead to a unique business identity for each spouse ■ A clear division of roles and authority—ideally based on each partner’s skills and abilities—to minimize conflict and power struggles ■ The ability to keep lines of communication open, talking and listening to each other about personal as well as business issues ■ The ability to encourage each other and to lift up a disillusioned partner” (Scarborough 25) References: Scarborough, Norman M.. Effective Small Business Management VitalSource eBook For DeVry University, 10th Edition. Pearson Learning Solutions. <vbk:9781256323235#outline(5.8.8)>. b) Challenges: Family businesses sometimes suffer from negative...
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