Activity:

Help me start an essay that addresses the following questions posted by Jennifer and her partners. This report should be well researched and offer specific recommendations for her company. Write in an essay format that answers the following questions.

• What is the business environment like for Jennifer and the type of business she is planning? What dimensions of the business environment might impact Jennifer's business, and how? What other areas should she consider?
• What ethical and social responsibility issues should Jennifer consider in this business? What can Jennifer do to be a good corporate citizen? Be specific in your recommendation.
• What are the types of business forms that Jennifer might consider choosing for her small business? What are advantages and disadvantages of each, which do you recommend for Jennifer, and why?
• What sources of funding are available for small businesses? What are details, advantages and disadvantages of each, which do you recommend for Jennifer, and why?

Scenario: You are a small business consultant who has been hired by Jennifer to advise her on a business opportunity that she wants to undertake. Jennifer is an entrepreneur who wants to start a new clothing store in her suburban hometown with her target market being female baby boomers. Your task is to provide Jennifer a written assessment of the opportunity, plus recommendations that can help her be successful. This is the first of two meetings that you have scheduled. In this meeting, you will focus on the various dimensions of the business environment that will impact Jennifer's small business, ethics and social responsibility, types of business forms, and sources of funding available to finance the small business. You are to explain options and give your recommendations to Jennifer. Telling her options for her to evaluate will not be sufficient. She has hired you to tell her options but also evaluate them for her, and give her your specific recommendations.

Your role: You are a consultant newly hired by Jennifer to help her understand and provide expertise, research, and recommendations for planning and opening her new clothing store. As the consultant, you are being paid to provide specific and unbiased advice to Jennifer and her business partners. This is part one of a two-part You Decide. In part one, your consulting efforts will focus on the dimensions of the business environment and how each one will impact Jennifer's small business, ethics and social responsibility, types of business forms, and sources of funding available to finance the small business. Note that all of these topics have been covered in Weeks 1 through 3 of this course. Be sure to utilize the textbook and other research as necessary. You will base your recommendations on research, facts, and proven methods, and not simply your opinion.

Key players: Jennifer (store owner)Hello, thank you so much for coming to our meeting today. Let me introduce the team that is represented here. First of all, I am Jennifer, the founder of Jennifer's Clothing Store. To my right is Mr. David Green, who is a cofounder and an important adviser to our company, and to my left is Mr. George Hendrick, who is our finance director. Let me be brief and talk a bit about what we want to do today. I am considering the launch of a new clothing store in my suburban hometown. I have actually found three possible locations that are available for lease. Any one of them would be excellent for a clothing store. I hope you can shed light, from a business perspective, on various factors we should think about when we are choosing our store location. We have a great team here today, and I hope that someday, the business can be big enough to sell so I can retire with my husband. Other than that, I do not have any particular short- or long-term goals for the store. That is all I have to say for now; I want to turn it over to David to discuss.

David Green - Co-founder - Thank you, Jennifer. I have a few items that I would like to discuss in this meeting. First, let's chat about the need for a truly ethical and responsible company. Jennifer and I recognize the importance of having a store that preaches a culture of ethics, is responsible to the environment, and a true member of the local community. We would like for you to think about ways our company can show the general public that we care about these issues. Secondly, Jennifer and I have talked about this company and know the clothing business, but we have no legal background whatsoever. We would like for you to recommend the legal form our business should adopt. Should it be a general partnership? Should we get an LLC? A corporation? We simply do not know and hope that you can do some research and give us some sound advice. Please be sure to tell us why you chose the legal form, because this will be important for us to understand. In addition, we are concerned about funding to start the business. We have some money available to us as George will explain to you, however, we are also interested in investigating options for other sources of funding. Those are the issues I would like to see addressed; now I want to turn it over to George, our finance director, to discuss the financial issues.

George Hendrick - finance director - Thanks, David. Now we need to talk about the initial funding needs of this firm. We estimate that Jennifer would need about $20,000 to get the store ready to open. This includes basic renovation of the location we choose such as painting, a sign, and store fixtures. One advantage is that Jennifer doesn't need a complex payment processing system or cash registers, because she can check customers out using applications on a smartphone. This will save her several thousand dollars compared to a retailer who doesn't use this technology. Jennifer also needs to buy inventory, but she's uncertain how much inventory to buy. She could buy $10,000 of merchandise inventory, which would give her some basic styles in different sizes. However, she's considering buying an additional $20,000 of merchandise inventory, which would give her several additional styles for customers to choose from, plus many popular accessories. In addition to the start-up costs, Jennifer will require some working capital to run the store until it becomes profitable. It typically takes 3 to 4 months before a store is selling at its maximum potential. Jennifer has $35,000 in savings and has room on her credit cards for $20,000 more. What recommendations do you have for acquiring the capital needed to get this store off the ground? Should we look at equity financing or debt financing? And in either case, where should we look to find the funding? We realize this part is challenging, and your recommendations will be important for this start-up. That is all we have at this time; we look forward to reading your report, and we thank you for your time.