How to Start Your Own Business – Firms & Corporate Governance

If you’re thinking about starting a new business, you need to start by defining what kind of business you want to start. A business is pretty straightforward – it’s simply defined as a human enterprise or group of human enterprises that engage in specific activities for the purpose of earning a profit. A business may be for-profit enterprises run solely to meet a social need or a purely for-private, non- Profit enterprise. The most common types of businesses include manufacturing, retailing, and related services such as financial services and transportation. Some examples of businesses that meet these broad criteria are fast food restaurants, retail stores, home businesses, and franchises that distribute products manufactured by other companies.


To ensure maximum profits for your firm, it’s important to decide what kind of profit model you wish to adopt. There are two general kinds of profit models: positive cash flow and non-cash operating profit models. Positive cash flow and non-cash operating profit models maximize profits by generating profits immediately and paying their bills on time. Non-cash operating profit models minimize expenses by relying on retained earnings to generate profits and paying taxes on these profits only after a predetermined amount of time has passed.

In order to ensure maximum profitability for your firm, it’s important that you establish and adhere to corporate governance policies. These policies specify how and who are responsible for making sure the firm meets its obligations in a timely and effective manner. It’s important that you set the appropriate corporate governance policies that match the nature of your firm. For instance, a lending firm may wish to consider corporate liability in the lending industry as compared to a technology firm.