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Hitesh Jhanji, Lovely Professional University
                                                                          Unit 8: Setting up a Small Business Enterprise




                  Unit 8: Setting up a Small Business Enterprise                                Notes


             CONTENTS
             Objectives

             Introduction
             8.1  Steps for Starting a Small Enterprise
                 8.1.1   Assumptions

                 8.1.2   Raw Material or Market Site
                 8.1.3   Material Index
                 8.1.4   Need for Enterprise Location

             8.2  Selection of the Type of Organisation
                 8.2.1  Selecting a Business Entity: Sole Proprietorship
                 8.2.2   Selecting a Business Entity: Joint Partnership

                 8.2.3  Selecting a Business Entity: Limited Liability Company (LLC)
                 8.2.4   Selecting a Business Entity: Corporations
             8.3  Summary
             8.4  Keywords

             8.5  Review Questions
             8.6  Further Readings

          Objectives

          After studying this unit, you will be able to:

               Describe the steps for starting a small business
               Explain the concept of enterprise location
               Discuss the selection of type of organization

          Introduction

          In the previous unit, we dealt with the concept of business plan and feasibility study and also
          discussed about the value and importance of a business plan. This unit will help you to understand
          the procedure of starting up a small business. The various sections and sub-sections of this unit
          will also summarize how to select the type of organization for startup of small business. Planning
          is the first and the most crucial step for setting up a business or venture.

          Indeed, the consumer’s sovereignty has always been considered as vital today as in ancient time.
          It was largely through small business that civilization was spread to all four corners of the then
          known world. Small businesses brought to the have-nots the benefits of such things as Babylonian
          astronomy, Greek philosophy, the Jewish calendar, and Roman law. Since then many nations,
          both developed and developing, have recognized the crucial importance small business as a
          useful source of growth: the former as complementary to large industry; and the latter for the
          creation of new employment avenues on a large scale in the shortest possible time.


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