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Custom Legal, Social, and Economic Environments of Business 2 essay paper sample

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Starting a business from a feasible idea requires adequate deliberation. The person with the business idea in question does not have enough capital implement it and seize the opportunity. He or she does not also have the essential management skills to run the business once it starts. However, the market niche would yield very much if this chance is exploited. This is because the home appliance to be manufactured will be an alternative and preferred to similar ones which are already rated dangerous.

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A sole proprietorship is a business entity with a single owner who is said to have no separate existence with the business. The business person will incur all the loss and other expenses single handedly. On the other hand, it is beneficial because it has no elongated protocols if one wants to start it and all the profits are only accruable to the owner (Lucas, 2000).

A partnership involves several individuals who start a business and consequently share both the profits and losses. It could be limited liability or unlimited depending on how the partners have registered it. It is beneficial because the expenses and losses are shared equally among the partners but non beneficial if profit is little and has to be shared among many partners (Lucas, 2000).


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A corporation is an organization that has been granted more rights than the rest of business organization types. It is a tedious process to incorporate an organization but it has several privileges once it qualifies. The owners have separate legal entity from the business so they are not responsible if the business is liable for anything (Lucas, 2000).

The best business type for this business idea in question is a partnership, and may be later expanded to be a corporation. According to the features of a partnership, it is the most applicable business model for such a situation. The members will pool a share of capital which will be used to start the business. Therefore, the pioneer of this idea does not have to look for capital alone. In case any loss or expenses are incurred, the partners will share and not one person as it would be in sole proprietorship. All members will participate in management of the business. This will allow the business to be operated as expected. With time the members may decide to incorporate the business and fully enjoy the privileges of a corporation. In this case, the partner would be the spouse.

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