If you are looking for ways to invest in the business world then you should consider talking to an attorney who is experienced with commercial law and the rules and regulations that govern investing. Commercial law is primarily concerned with the exploitation of the assets of others in order to benefit from those assets. Understanding the ins and outs of commercial law can help you take advantage of opportunities and avoid potential pitfalls that could affect your business.
A partnership is an agreement where two business owners enter into a business deal together, often as members of an ownership group. Partnerships can be individualized, where one partner purchases a controlling interest in the other’s business, or it can be formed between multiple partners. The partners in a business partnership can be individuals, corporations, interest-based industries, educational institutions or groups. Businesses can be composed of one or more chain stores, franchises, or regional partners. In a partnership agreement, the business owners normally control the outcome of the business and divide profits and losses equally.
Franchise operations fall under the type of partnership agreement. These kinds of partnerships exist in many different types of franchise businesses. Franchises are types of businesses that allow numerous independent shops to work together under one roof to sell the same type of product under one brand name. In some cases, franchisees sell only a portion of the brand when the franchise agreement is purchased. Franchise businesses are usually very successful, because they are appealing to other small businesses and franchises alike.
In franchise agreements, the business owners typically form a limited liability company or LLC. This means that all the partners are treated as an entity separate from the franchisor, but one that has the same rights and responsibilities as other partners. All franchisees have equal opportunity to make a profit but also have the same rights to participate in franchise auctions and to sue the franchisor if they feel their rights have been violated. The reason behind this is that the partnership agreement prevents some sort of joint venture scams that could happen with multiple independent stores working side by side under one roof. Also, the franchisee has no control over the stores, so any complaints from the franchisee could be a potential liability for the franchisor.
Another example of general partnership agreements is a limited liability company or LLC. Under these agreements, all the partners share in the liability of the company but have different opportunities to control it. The general partners usually own a majority share in the LLC, while the limited partners are only required to invest a specific percentage of the funds. Limited partners share in the profits of the business, while the general partner retains all the equity in the LLC.
Businesses can also create general partnerships and limited liability partnerships. If a person owns two franchises and wants to form a new partnership, a general partnership agreement could be formed. A limited liability partnership agreement is much more preferable as it gives the partners a legal certainty that they will not be personally liable for the debts of the partners. These types of partnerships have grown in popularity because they are a good option for start-up businesses that lack capital to purchase startup businesses of their own. These auctions, via sites such as Boat Parts are also available online.