Private Partnership the Way To Go

My major privately held corporation makes pencil erasers that look like celebrities from movies. The company is wildly successful, especially our Pirates of the Caribbean line, featuring Johnny Depp. Kids just love them; they add so much fun to their daily academic work. The demand is just as huge as expected. We started the idea and now we have to increase the production and supply of the erasers to satisfy the publics demand. Our plant is very small and the amount of erasers we make daily is limited. Therefore, we have to build a new plant. However, money is an issue. We do not have sufficient funding ourselves and need to find the funding through other resources. We have also made the decision to keep the company private and seek a partner to help raise the money we need to obtain a new plant.

There are many reasons that support our decision. There are some advantages of working individually. If I am the only owner of our business, I could do whatever I want, be in control over my business, and take all the gains. However, I also have to bear the risks by myself. If the erasers become unpopular, and the company goes out of business, the losses are mine. The risks rest with me. Some people feel it is great to be the boss, and enjoy the pride of ownership. While I disagree with that, I also recognize that pride does not necessarily make your company a good company. Your pride of being the boss will have no effect on your company. There are more disadvantages than advantages in working privately, but disapprove of the choice of getting a loan and doing everything as sole.

Creating a partnership can solve some disadvantages of working alone in a private company. In this way, the company will share the responsibilities and risks. A partner can also bring valuable contributions to the company. A partnership will increase the assets of the company bringing new vision and managerial experience. More importantly, the risks would be shared in case the eraser business is not successful.

Although going public is not necessarily a bad idea, it is not the best option for my business. As a public company, we may have limited liability and greater financial capital, but we would have an increase in taxation. In addition, there would be a tremendous amount of paper work and filing of financial reports involved causing the company’s expenses to rise. Furthermore, it would be difficult to meet the demands of a public company because of increased government control, and the many rules and regulations it would have to follow. Our product of erasers would not need to be so regulated.

Having considered all the pros and cons, we have come to the conclusion that keeping the company private while finding a partner is the best choice for this business. With a partner, it will be easy to raise the financial capital to grow the business. Perhaps a celebrity would want to help run the business. The partner must be fun to work with, somebody who shares the same passion, and eager to develop the business. By combining both the managerial skills and talent of a strong partnership, it will make the business soar.