Business Formation

I have accepted the challenge of creating the following business entity from the provided list of four hypothetical business entities.

Five friends have gotten together to form a commercial construction business. Two of the friends have sizeable assets, but little construction experience. These two also have some experience in running companies. The other friends have a small amount of capital to invest. Their major contribution to the group is that all three formerly worked for very successful homebuilders, and one individual headed the local division of a national construction company for the past two years. Even with their combined savings, the group realizes that they will need to either obtain bank financing or outside investors. Bank financing will require that the five friends put up their personal assets as collateral. Outside investors will not demand personal collateral, but will demand control. The five friends believe that the company will be a success. Yet, even without having to give a bank personal collateral, they are concerned that if the business fails, they could lose everything they have accumulated.

1) Idea/vision for the business.

I will name this business, ALR Commercial Development, LLC. I envision the business as one, which operates with honesty, integrity, and provides leadership within the communities in which it operates. The business would also provide superior customer service and strive to complete all projects on a timely basis. ALR would focus on developing small and large-scale shopping malls. The target area for projects would first be throughout the New York area. If successful, we would then take on projects in Long Island and New Jersey.

2) Identify legal and regulatory issues to be considered in creating/modifying this business.

Business operations are monitored by government agencies. These agencies help protect the public from harm. In creating my commercial construction business one of the matters I need to first consider is in hiring employees. The New York State Department of Labor is New York State’s primary advocate for job creation and economic growth through workforce development. The department administers New York’s unemployment insurance system, labor exchange system, and Welfare-To-Work programs. The department also oversees state worker protection programs, including enforcement of safety and health regulations in the public sector, state labor laws and federal statutes related to working conditions, wages and hours, and laws related to Public Work. The Department of Labor serves as the State’s principal source for labor market information and offers a variety of services designed to help businesses find workers and people find jobs (www.labor.state.ny.us/agency ). The two other federal agencies to consider are the Equal Employment Opportunity Commission (EEOC) and the Occupational Safety and Health Administration (OSHA). The EEOC exists to prevent discrimination in employment based on race, color, religion, sex, or national origin and other unlawful employment practices. The OSHA ensures that all employees have safe and healthy worksites. I will need to do my homework on employment law. Other legal issues include the filing and paying of proper taxes, which is, monitored the Internal Revenue Service (IRS www.IRS.gov ).

3) How would you select professionals to rely upon for business advice, and whom would you choose?

In New York City (NYC), future business owners and existing business owners can tap into many free services offered by the local chambers of commerce, business libraries, and various not-for-profit groups. In order to get ALR commercial development off the ground I would first seek the assistance and advise of these professionals. My first stop would be the Brooklyn Business Library (www.biz.brooklynpubliclibrary.org). Many resources can be accessed via the Internet and/or by attending low-cost workshop services. One great resource that is available is SCORE (the Service Corps of Retired Executives) these executives provide free business counseling at the Business Library. Experienced business people offer private, one-hour sessions of business coaching. You will also learn to write a business plan, apply for a loan, and improve you management skills. An entrepreneur is usually matched with an executive who has experience in the type of business you are looking to create. In my case I would look to pair up with an executive who has experience in commercial development.

The second resource that I would utilize is the NYC Business Solutions Center at the Brooklyn Chamber of Commerce is an initiative of the New York City Department of Small Business Services (SBS) and brings the services of SBS to the five boroughs of NYC (www.ibrooklyn.com/businesssolutionscenter