Feb. 25th 2011
In partial fulfillment of the requirements of ADM 1300
Date: February 25th, 2011
Subject: Derek’s Shawarma
Problem: Derek and Sal needed to decide how to structure the ownership of their business.
* Maintain the status quo * Choose the general partnership * Choose the limited partnership * Choose the public corporation * Choose the private corporation
Facts considered: * Derek graduated from the Telfer School of Management at the University of Ottawa 13 years ago, and his specialization in management. * Derek started his career in a middle management position at a firm in Ottawa; but Derek didn’t satisfy…show more content…
pros | cons | It has no expense. Derek will keep his current income. | Derek will not feel satisfied with his success in the corporate world. | There is no risk as well as uncertainty. They have the normal life as before. | The potential promotions were not enough to keep him inspired. | Derek can get a stable income to keep his life moving on. | They cannot make a lot of money if they don’t run this business. | Sal have a peaceful retirement, he doesn’t need to worry about his work. | |
Although this is a no cost option in the short term, it will cost a lot in the long term. Derek will feel worse in his day-to-day work. Sal cannot keep busy during his retirement. Status quo will not solve the primary problem. Depending on compare pros with cons in the table, it’s better for them to run this business. Showing their talents in business will be an unforgettable experience in their lives. So, this alternative cannot solve the problem.
No.2: The general partnership
The general partnership means both Derek and Sal are actively involved in managing the firm and have unlimited liability. Sal not only financial supports the shawarma restaurant, but also participates actively in the business. This can decrease Derek’s pressure in management. Sal can know what is happening in his restaurant, can keep busy in his retirement, and he can make decisions in this business.
pros | cons | Both of them can do their best to manage this business, they have