Private Company Limited By Shares Law Company Business Partnership Essay

Published Date: 02 Nov 2017

1. INTRODUCTION

There are a lot of factors to consider before your start your own business. Find out if your business idea is viable, whether you have the personality it takes to be successful, and how to draw up a basic start-up business plan

1.1 Objectives

The aim of my research is to analyze open new business. As well method of how to open up the business.

2. METHODOLOGY

My research begins....

3.1 Setting Up a Design Practice : Business Plan

A business plan is a tool which helps entrepreneurs to plan their businesses. It is a written summary that describes important aspects of the business. The nature of the business plan will be determined by the purpose for which it is needed. Persons seeking funding will require a formal business plan. This is best done by a professional with the relevant experience.

(http://www.gov.vc/index.php?option=com_content&view=article&id=210:business-planning&catid=46:business-news&Itemid=55)

http://www.businessdictionary.com/definition/business-plan.html

1. Small, Medium, Large Enterprises

Small firms showed to have differences advance to training, recruitment and work organization than medium or larger firms. Small firms liked to give partiality to outer applicants in filling situations and were less likely to use formal enrollment methods or to use presentation or personality tests in filling vacancies. SMEs showed a lower predisposition to provide formal off-the-job training than large firms, but employees took a similar amount to that provided by larger firms, where this was available. It was also the case 42 Small and Medium-sized companies that employees of SMEs were less likely to feel displeased with the training that they had received and were more likely to powerfully agree that managers encouraged employees to develop their skills. In conditions of work organization, there was little evidence that the use of team-working within workplaces wide-ranging greatly with firm size, but SMEs made less use of problem-solving groups or suggestion schemes than large firms. They were also less likely to carry out evaluations or to provide training on practical flexibility, although employees of small firms were more likely to be functional flexible in perform than employees who worked for larger firms. Working patterns depicted to be rather different in SMEs in that there was less use of shifts, zero hours and annual hours contracts, while the employment of part-time workers was common. There was some data of greater workforce strength in small firms, both based on management and employee reports, although SMEs did make greater use of fixed-period and temporary contracts and freelancers. They were also less likely to use agency workers or subcontractors to supplement their own employees. Besides the fact that employees were more likely to feel that their job was secure in SMEs, it was also notable that they reported greater job influence and independence and expressed greater satisfaction with their work, and with the organization that they worked for, than the employees of large firms.

2 Small, Medium, Large - Manufacturing System

Flexible Manufacturing

It uses equipment that is controlled by a number of computer Numerical Control(NC) computers. The production relies more on robotic cells than manufacturing personal which allows the business owner to change the products manufactured to react to customer or market needs. The use of automation produces a product that is manufactured to precise specifications which in turn produces improves the quality of the product.

Disadvantage - high initial cost of the manufacturing equipment

Intermittent Manufacturing

If a small business is going to manufacturer products that are of a similar type, they can adopt an intermittent manufacturing method. Business that manufacturer items that are similar in Nature, but have variations, are suitable for "intermittent manufacturing. Example, a company that only manufactures tires for bicycles will sell tries that are of different sizes to fit a variety of bicycle wheels. Business will manufacture batches of the same product depending on demand and then will manufacture a batch of the same or another product. It is good for products, which are based on fluctuating demand.

Custom manufacturing

This method is used by a large number of small busniesses. This method allows business owners to fully customize their finished product to the requirements of the customer. Many items can only be manufactured in this method due to their complexity or the skill required in manufacture cannot be replicated by a machine. Small business owners that work alone often specialize in items that are made using custom manufacturing.

Manufacturing is not limited only to large business; thousands of small businesses manufacture items that are used by customers across the world. Small manufacturing business can be very successful when they offer items there niche products where they have very few competitions. Small business owner should remember that they do not have to know every aspect of running a business and can use professional services such as accounting, marketing and technology companies to gain a competitive advantage.

3. Commerce, Service, Non physical items based products

3.2 Legalities

Small Business Set Up : Legalities

A business firm is either a sole-proprietorship or a partnership. Individuals and companies, being "legal persons", may set up and own a business firm.

Individuals and companies registering business firms need not be Singaporeans or incorporated in Singapore.

The manager of a business firm must be: a Singaporean, Singapore Permanent Resident, Singapore Employment Pass Holder or Dependant's Pass Holder.

Structure of business entities; sole-proprietorship, partnership, company

Sole-Proprietorship

A sole-proprietorship is a business owned by one person or one locally incorporated company. It is the simplest and most flexible business structure. A sole-proprietor has unlimited liability.

Set Up Cost

Fees for approval of business name : S$15 per name

Registration fees : S$50

Yearly renewal fees:S$20

Advantages

*Quick and easy to set up - Many low-risk service businesses such as copywriters, small retailers, pet groomers and designers start off as sole-proprietorships

*Easy to administrate

Sole-proprietors do not need to audit their accounts or file annual returns with ACRA

* Easy to manage - The owner is the sole decision maker

*Exclusive use of profit

The owner receives all the business profits.

Disadvantages

* The owner bears all costs and risks

* The owner is personally accountable for debts and losses. The owner may be required by law to sell off personal assets (e.g house, car, shares, etc) to pay off debts and losses. You may want to avoid setting up as a sole-proprietor if your business involves big risks and possibly huge losses.

*Borrowing powers for sole-proprietors are more limited. To secure loans from banks and lending institutions, the owner must be prepared to put up his/her own personal assets as collateral.

*The owner cannot raise funds by selling a stake in the business to investors as sole-proprietorships can only be owned by a single, individual or company.

* As the business and owner are inseparable, the business may come to a standstill when the owner falls sick or dies.

Partnerships

General Partnership

Like a sole-proprietor, the business of a partnership has to be registered under the Business Registration Act. A partnership may consist of individuals or companies , the minimum number of partners is two and the maximum is twenty. Once there are more than twenty partners, the business must be registered as a company under the Companies Act. As general partnership is not a separate legal entity, members of the partnership are jointly and severally liable for the debts of the partnership.

Set Up Costs

Fees for approval of business name : S$15 per name

Registration fees : S$50

Yearly renewal fees : S$20

Advantages

*Quick and easy Set Up - other than registering with ACRA, there are no other formalities required. However, it is advisable to draw up a Partnership Agreement with the help of a lawyer. The contract helps to define the role, responsibilities and profits due to each partner.

* Easy to administrate - Partnerships do not need to audit their accounts or file annual returns with ACRA

* More resources and sources of funds - Partners bring resources, experience and funds to the table. Banks and other lending institutions may also be more willing to lend based on the combined assets of all the partners.

Disadvantages

*All partners bears the costs and risks. As each partner has the implied power to act on behalf of the partnership, a partner can be made accountable for the loss caused by another partner.

* Partnerships are automatically dissolved when a partner exits or dies. The remaining partners will have to form a new partnership.

* Like sole-proprietorships, partners are personally accountable for busniess debts and losses. The partners may be required by law to sell off personal assets (e.g. house, car, shares, etc) to pay off debts and losses.

* Decisions relating to the partnership (e.g addition of new members, change in the nature of business) must be agreed by all partners.

Limited Liability Partnership(LLP)

A LLP is a business structure that offers all its members limited liability while allowing them to retain the flexibility of operating the LLP as a traditional partnership. A partner of an LLP is not personally liable for the malpractice of other partners in the firm. The partner is however personally liable for his own negligence and personal misconduct. LLPs are commonly used by professional firms and start-ups.

Set Up Costs

Fees for approval of LLP name : S$15 per name.

Registration fees: S$150

Yearly renewal fees: Not applicable.

Fees for conversion from a business or a company into an LLP: S$ 100

Advantages

*Limited Liability - The personal assets of the partners are protected. In addition, owners are not personally accountable for the wrongful acts of other owners. However, partners can be personally accountable for debts and losses resulting from their own carless actions.

* Perpetual succession - Any changes in the LLP (e.g resignation or death of partners) do not affect its existence, rights or liabilities.

* Easy to administrate - Like partnerships, there is no need to audit or file annual returns with ACRA. However, the appointed manger must make an Annual Declaration to ACRA stating whether the LLP is able to pay its debts as they become due in the normal course of business.

* More attractive to investors- investors may be more willing to join as silent partners as liability for partners is limited.

Company Incorporations

1. Private Company Limited by shares

Most companies in Singapore are private companies limited by shares and bear the suffix "Pte Ltd" or "Private Limited" to its name. A private company which wishes to maintain than 50 shareholders must be converted to a public company limited by shares.

2. Exempt Private Company (EPC)

An Exempt Private Company (EPC) is one with less than 20 individual shareholders and with no corporate shareholder. An EPC does not need it accounts to be audited if revenue is less than S$5 million for the financial year. However, professional firms filing on behalf of EPC may still require the hardcopy exempt certificates from directors as evidence of compliance and for record purposes.

3. Public Company limited by guarantee

A public company limited by guarantee is one which carries out non-profit making activities that have some basis of national or public interest, such as for promoting art, charity etc. There is no share capital.

4. Public Company limited by shares

A public company limited by shares is one where the number of shareholders can be more than 50. The company may raise capital by offering shares and debentures to the public. A public company must register a prospectus with the Monetary Authority of Singapore before making any public offer of shares and debetures.

5. Branch Office of Foreign Company

Foreign companies may conduct business in Singapore by establishing a branch office. Any foreign company wishing to register a branch has to engage a professional firm such as a corporate secretarial firm or a legal firm to assist in the application.

6. Representative office

A foreign companies may establish a representative office in Singapore to undertake promotional and liaison activities on behalf of its parent company. The office, however, directly or on behalf of its parent company, must not be engaged in business, conclude contracts, provide consultancy for a parent company, must not be engaged in business, conclude contracts, provide consultancy for a fee, undertake transshipment of goods, or open or negotiate any letter of credit.

Approval for the establishment of a representative office must be obtained from IE Singapore.

7. Operational Headquarters (HQ)

The Singapore Government encourages companies to use SIngapore as a base to conduct headquarters management activities to oversee, manage and control their regional and global operations and business. The HQ can be in the form of Regional Headquarters, International Headquarters, Operational Headquarters, Business Headquarters or Manufacturing Headquarters.

3.3 Intellectual Property

1. Copy Right

The Copyright Act provides that the owners of creative works such as literary works, dramatic works, musical works, artistic works, wound recordings, cinematographic films, television broadcasts, sound broadcasts, sound broadcasts, cable programmes and published editions of works enjoy a monopoly to (i) make a copy of the work, (ii) publish the work, (iii) perform or cause the work to be seen or heard in public, (iv) communicate the work to the public, (v) adapt the work and (vi) enter into a commercial rental arrangement relating to that work. Whether or not the full monopoly of (i) to (vi) applies depends on the type of work in question.

There is no requirement of formal registration - copyright is automatic and, subject to certain requirements, begins at the point of creation. The duration of copyright protection may be as the lifetime of the author and 70 years thereafter depending on the type of work. Depending on the type of infringement, a copyright owner can claim damages, an injunction and account of profits against infringers of that copyright.

Coca-Cola is a good example that it owns copyright in the design of its bottles, the design of its logos, its advertising, and generally anything it creates that can be considered an original work requiring creative effort. For example, the famous Coca-Cola logo and script design is an original artistic creation that is protected by copyright law. In other words, the right to copy the logos and script design is limited by copyright law.

2. Trade Marks

Registered trade marks are protected via the Trade Marks Act. For a trade mark to be registrable, it must, amongst other requirement, be capable of graphical representation, distinctive, non-descriptive, non-generic and non-functional. A trade mark will be considered infringing if it is similar to an earlier registered trade mark it is to be registered for goods and services which are similar to those for which the earlier trade mark is protected and as a result there exists a liklihood of confusion on the part of the public. Owners of trade marks that are well-known in Singapore have greater protection. Such marks are protected against confusing associations, dilution, tarnishment and free-riding. Depending on the type of infringement, a registered trade mark owner can claim damages, an injunction and account of profits against infringers of that trade mark.

The Coca-Cola company holds registered trade-marks in its logo and script design. Even the distinctive shape of the Coke bottle is trade-marked. These things are trade-marks because they are distinctive marks used by the company to identify its goods and services as being uniquely Coca-cola's.

3. Patents.

Patents are concerned with the protection of functional and technical inventions in the form of new products and processes. In Singapore, patent protection is governed by the Patents Act (Cap.221). Inventors can obtain patent protection for their inventions by registering their inventions with the Registry of Patents. The inventor's patent rights are not restricted as to nationality or residency so long as the parent is registered in Singapore. As most inventors are actually employees, the Patents Act provides that inventions made by employees in the course of their employment would be owned by the employer.

Patentable inventions must be new, inventive, and have industrial application. The requirements for patentability are very stringent, and the process to obtain patent protection is both difficult and costly relative to other intellectual property rights. A significant part of the difficulty lies in the need to establish that the invention is in fact "new" and the highly technical drafting of the patent documents. The patent specifications are the key to the validity of the patent and therefore, the application process would generally require the appointment of a registered patent agent who possesses the requisite skills of drafting patent specification. The relative difficulty in obtaining patent protection as compared to other IP rights is justified by the very strong monopoly granted by a patent.

The process for applying for a patent involves five main stages, namely (i) the filling of the application, (ii) the preliminary examination, (iii) the search and examination, (iv) the publication of the application and (v) the granting of the patent. The patent system in Singapore operates on a first-to-file basis.

Coca-Cola company creates various inventions to assist with its business. Many of these are patented, even the ones that are not particularly unique, since an invention does not have to be totally unprecedented to be patented; it just needs to have some element of novelty.

For example, the Coca-Cola company owns a patent on a method of making "barrier coated plastic containers." Obviously no one has the exclusive right to make plastic containers, but Coca-Cola has the exclusive right to use the particular method of making those containers that they describe in their patent.

4 Industrial Designs

A design refers to the features of shape, configuration, pattern or ornament applied to an article by an industrial process. An example of a design would be the shape and configuration of a fancy speaker system. Protection for the design created for industrial use can be sought under the Registered Designs Act ("RDA") by registration of the design with Registry of Designs. For a design to be registration of the design with Registry of Designs. For a design to be registrable, the main requirements are that the design must be new, it must be industrially applied and its features are not solely for a functional purpose. Once a design has been registered, the owner of the registered design can prevent others from using the same or similar design. If any other person uses the registered design without permission, the owner of the registered design may obtain damages or an account of profits, and an injunction against continued use.

The protection of industrial designs overlaps to an extent with other intellectual property rights like copyright as some industrial designs are also artistic works. In certain cases, the design may also be protected as a trade mark. Also, there are restrictions on copyright infringement actions for works registrable under the RDA. The disadvantage of protection under the RDA relative to other intellectual property rights is that the designs can only be protected for a maximum of 15 years.

(Import and Export legal system)

3.4 Time Management

Generation of effective teams is dependent upon company's performance ethic. 'Team' is defined as a small number of people with complementary skills who are committed to a common purpose, performance goal, and approach for which they hold themselves mutually accountable.

Team success work

multi-functional involvement simultaneous full-time involvement communication co-location communication shared resources outside involvement

Team Leader

Build commitment/confidence

Keep purpose, goals/approach revevant/meaningful

Do real work

Create opportunities with outsiders.

Monitor timing/ schedules for planned activities

Strengthen the mix/ level of skills.

3.5 Teamwork Skills

3.6 Budget Planning : Projected Profit/Loss

- Basic of Taxation in Singapore (Import and Export tax system)

In Singapore, taxes are levied on income of companies, individuals and property. In addition, taxes are levied on use of property and consumption which are known as property tax and goods and services tax respectively. However, there is no capital gains tax.

For business in Singapore that have earning of SN$300,000.00 the tax is only 17%. Also, if your company is just starting up, you can enjoy a tax exemption of 100% of SN$ 100,000.00 and 50% of SN$ 200,000.00