Forms of Business Organization: Francis B. Palumbo and George E. Rippel Jr.
When entering any type of business venture, many considerations must be taken into account. The type of business is quite important, in that it could be a small business, perhaps a community pharmacy, or it could be a large business, such as a major pharmaceutical manufacturer. In between are many other possible scenarios, including small group practices or consulting businesses. Each type of business has its own method of operation, its own financial needs, its own needs for governance such as a board of directors or shareholders, and its own expected profitability. In deciding what form of organization to use in conducting business, it is important to look at issues such as these and decide what is best for the short run, the medium run, and the long run. That is to say, when a small business is being put together the individuals might not have need for a regular corporate structure but may opt to enter into a partnership or some other form of organization. As the business grows and prospers, their organizational needs would be different and they may in fact need to take on the structure of a larger corporation. Many of our large corporations grew out of one individual’s hard work and foresight.