Important Farm Business Terms Define

1. Sole Proprietorship:  A one-person operation. The business may have a number of employees or hired persons; but the proprietor owns, runs, and manages the business.

2. Partnership: An aggregation of owners. Two or more persons contribute their assets to the business and may share the management, responsibility, profits, and losses. Each partner pledges faith in the other partners and stands liable for the actions of all partners within the scope of partnership activities.

3. Limited Partnership: A special form of partnership permitted by state law to have one or more partners whose liability for partnership debts and obligations is limited to their investment in the business. A limited partner is just an investor. If a limited partner participates in management, then liability will exist for all partnership obligations like a general partner. A limited partnership must have at least one general partner who handles the management of the business and who is fully liable for all partnership debts and obligations.

4. Corporation: An artificial being created under state law. A corporation is a separate business entity distinct from its owners, who are called shareholders because they own shares or interests in the corporation. The major characteristic of the corporate form of business organization is this sharp line of distinction between the business and the owners. The corporation is a separate legal entity as well as a separate taxpayer.

5. Tax-Option Corporation: A creation of federal tax law. A corporation in all aspects except that the corporate entity pays no income tax because each shareholder owner reports his or her share of corporate income for income tax purposes on their individual income tax returns. Tax-option corporations are subchapter S corporations.

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Business Services in the UK

This chapter examines business services’ impressive recent record in raising its share of value added and employment in the UK. It considers the sector’s productivity performance, including how business services can have a positive impact on the productivity of the wider economy through the services they provide. It also considers the contribution business service firms are making to UK manufacturing and concludes with a discussion of the level of concentration in these sectors.

All industries in this table are grouped within 2 digit divisions in the Standard Industrial Classification (SIC), and where possible industries are further broken down to a 3 or 4 digit level. Different SIC groupings are quite varied in size by definition, and direct comparisons may at times have limitations. Some groupings within the business services sector are more homogenous than others. The industries contained in the 74 group, ‘other business activities’, are the most diverse. They include a number of well-known professional services (legal and accounting) alongside industrial cleaning and labour recruitment. The 74 category also contains a group entitled ‘miscellaneous business activities’, which in turn has a further category entitled ‘other business activities’ (SIC 74.87). This category includes many important businesses including speciality design activities, conference organisation and brokerage activities and it alone has a GVA of over £15 billion.

Five industry groupings within the sector each generated more than £15 billion in GVA in 2004 – other software consultancy and supply (SIC 72.22), legal (SIC 74.11), architectural and engineering activities (SIC 74.2), labour recruitment (SIC 74.5), and within the miscellaneous group ‘other business activities’ (SIC 74.87). In terms of employment, five industries also provided more than a third of a million jobs – labour recruitment, industrial cleaning, other business activities, architectural and engineering activities, and other software consultancy and supply. The five sectors with the highest numbers of enterprises were other business activities, business and management consultancy, architectural and engineering design, other software consultancy and supply (each with more than 50,000 enterprises), and other computer related activities (with around 32,000).

Why Develop a Business Plan and Who Should Be Involved in the Planning Process?

New and experienced business owners, regardless of history or current situation, can benefit from business planning. As an experienced producer, you may develop a business plan to: map out a transition from conventional to organic production management; expand your operation; incorporate more family members or partners into your business; transfer or sell the business; add value to your existing operation through product processing, direct sales or cooperative marketing. It’s never too late to begin planning! If you are a first time rural land owner or beginning farmer who may be considering the establishment of a bed and breakfast or community-supported agriculture (CSA) enterprise, business planning can help you identify management tasks and financing options that are compatible with your long-term personal, environmental, economic, and community values. Business planning is an on-going, problem-solving process that can identify business challenges and opportunities that apply to your marketing, operations, human resources and finances, and develop strategic objectives to move your business beyond its current situation toward your future business vision. Once developed, your business plan can be used as a long-term, internal organizing tool or to communicate your plans to others outside your business.

Use your business plan to:

• ·         Make regular or seasonal marketi Make regular or seasonal marketing, operations, human resources and finance decisions.
• ·         Pursue long-term personal, economic, environmental and community goals.

Develop a business profile for communicating within or outside your family to potential business partners, lenders and customers. Before you begin working through this Guide, take a few moments to consider where you are in the business life cycle and why you are developing a business plan. Are you just beginning? Ready for growth? Planning to consolidate and transfer out of the business?  Based on your position in the business life cycle, what do you want to accomplish? Do you need to explore a critical finance- or operations-related challenge that you currently face? Research a perceived marketing opportunity? Prepare for an anticipated internal change in human resources? Most likely you have several, interdependent planning motives. This Guide is designed to help you work through many of them. Be aware, however, that retirement and farm transfer issues are not treated directly in the text or Worksheets. If retirement and business transfer are your critical planning issues, you may benefit by working through the first few tasks (identifying values, reviewing your history and current situation, and identifying your vision and goals), before talking with an attorney or financial consultant to help you develop specific business liquidation or transfer strategies.