In preparing your replies, consider only the employee issues in Question 4.
4. Advise Shania on which of the interested persons she should include in her business, why, and in what role(s). If she chooses not to take in a particular party, what reasoning should she give each person, if any? Your analysis must include biblical perspectives, such as biblical considerations of marriage and of business relationships with non-believers.
Reply to the threads of 2 classmates who reached a different conclusion than you did. Identify the points of difference in your analyses and explain how your application of the relevant law to the facts of this situation led you to a different conclusion.
Then, assume that Shania opened her coffeehouse and became so successful that she has 20 employees and needs to promote 1 of them to be the night shift supervisor. The employee base is quite diverse; in fact, Shania believes she should promote a racial or ethnic minority employee to demonstrate how inclusive her business has become. Explore the legal, ethical, and biblical issues if Shania makes her promotion decision entirely on that basis. What are her options?
Each reply must be supported by 3 scholarly sources, other than the textbook/course materials. Each reply must be properly cited in current APA format.
Review the Assignment Instructions for Discussion Board Forums, noting especially requirements for word counts, scholarly sources, and biblical worldview integration.
FIRST REPLY …………… Fredrick Croft
Form of Business
Shania’s goal of opening up a coffee shop in the area could be highly successful, especially utilizing a Christian theme and particularly appealing to other religious persons that reside in the area. The first thing Shania must decide is what form of business would best accomplish her goals. While a sole proprietorship is attractive due to its low startup costs and ease of setup, taking on complete liability for all debts incurred along with the inability to raise capital by selling shares of the business is not a good long term business model. Similar to a sole proprietorship, a partnership also will expose Shania to liability to debts owed by the company, as well as debts that her partner enters into (Kubasek, Browne, Barkacs, Herron, Williamson & Dhooge, 2015, p. 464). Seeing as she also does not have someone who she should share ownership in the business, aside from maybe her husband who she could use as a capital investor, a partnership is not the best option. The last two options Shania has with regards to business setup is to create an LLC or a corporation. Due to the simple and flexible nature of an LLC in a sense that it allows for many of the same limited liabilities that corporations do, yet requires much less record keeping and does not require many stipulations that corporations do, an LLC would be Shania’s best option for forming a business. By creating an LLC, Shania would have a much easier time with record keeping, tax reporting and liability shielding.
Determining whether to franchise or not is a big decision for Shania to make. Franchising offers many advantages when making a startup such as providing “tried and true” guidance in the early stages of business setup and operations. Also, franchising has shown to aid in defending market share when competition enters into your market (Welsh, Davis, Desplaces, David & Falbe, 2011). By choosing the franchise with that requires Shania’s coffee shop to use the company name and trade dress, she would have much less control over the name and overall atmosphere she could create, however this would benefit her in that the shop would have higher brand recognition and a built in customer base to go along with that. By opting for the franchising option that would supply Shania with product and staff training only, she would be able to build the atmosphere that she wanted and chose a name that she desires. The third option is to forgo franchising all together and build the business from the ground up her own; by doing this she would have complete control over every aspect of the business, but also have much heavier a burden with regards to supplier relations and staff training. Franchising gives new business owners the opportunity to hone their management abilities without having to account for every minute detail of the business operations (Hansen, 2018). Her choice here would greatly depend on both the amount of time and capital she has available to her. While franchising has its benefits, if Shania has the ability to bootstrap the business from the ground up with personal funding then she would likely do well in forgoing these options as she would not be beholden to product volume requirements or to create an atmosphere not her own. “Poor is he who works with a negligent hand, but the hand of the diligent makes rich,” (Proverbs 10:4, New International Version). The Lord rewards those who work hard in an honest and true manner; by creating a culture in her own company that rewards good, honest and true behavior, she will surely succeed in her business ventures.
The Gathering Place
The name Shania has chosen for her business will lend to be highly problematic as there is already a non-profit organization with the same name in Denver, Colorado . Not only is the name not available in the area, the organization has already trademarked the name for use and is in ownership of social media sites with the same name (“The gathering place”, n.d.). Due to these reasons, Shania will need to think of a different name for her business. “A good name is more desireable than great riches; to be esteemed is better than silver or gold,” (Proverbs 22:1, New International Version). Shania would be best to chose a name that is dissimilar to other companies and potential competitors as a means of differentiating her business and allowing for her to develop greater brand equity in the name (Alserhan & Alserhan, 2012).
Choosing Business Partners
In choosing business partners, Shania has multiple different friends and relatives to pick from, but not all of them are likely to be the most suitable. Shania’s husband Marvin has already made available the fact that he is willing to support her in her business venture financially, and she should greatly consider taking advantage of this opportunity. Kelsey, Shania’s sister, is a unique circumstance that proves troublesome; while she wants to work at the coffee shop and would likely be a good person to help run the store, the fact that Kelsey’s husband does not want her to work there creates a problem. Scripture may guide Shania in her contemplation of hiring her sister as the current situation stands: “It is to one’s honor to avoid strife, but every fool is quick to quarrel,” (Proverbs 20:3, English Standard Version); “The wisest of women builds her house, but folly with her own hands tears it down, (Proverbs 14:1, English Standard Version). Regardless of if Kelsey’s husband is a Christian or not, it should not be Shania’s place to be the cause of conflict between the two. The best course of action here would be to sit down with both Kelsey and her husband and try and come to a workable solution where both of their wishes are fulfilled; there may be a simple compromise that could be reached or simple objections that can be set at ease by planning out the venture together. If no compromise can be met, then I would likely recommend Kelsey does not come work for the shop; however, if she insists, then do not stand in the way of her sister’s goals as to avoid conflict with her sister. Lastly, Carlos seems to have a good eye for business; he seems like a good person to have on the team from a marketing perspective and could prove beneficial in growing the business. “Do not be unequally yoked with unbelievers. For what partnership has righteousness with lawlessness? Or what fellowship has light with darkness?” (2 Corinthians 6:14). On the other hand, Carlos being a non-believer may not have the same convictions or moral compass that Shania has and could possibly lead the business astray in pursuit of financial gain. Shania could hire Carlos on as an employee, but would likely be best to avoid joining in partnership with him as his motivations are purely money and it would give up control over her own business.
Alserhan, B., & Alserhan, Z. (2012). Naming businesses: names as drivers of brand value.” Competitiveness Review: An International Journal, 22(4), 329-342. Doi: 10.1108/10595421211247169
Hansen, D. (2018). Climbing the Ladder: 3 Lessons From a Franchisee-to-CEO: A powerful benefit of franchising is that it serves as an incubator to develop talented business professionals rapidly. The skills needed to run a successful franchise can differ from those needed to be successful as a franchisor. Franchising World, 50(2), 38+
Kubasek, N. K., Browne, M. N., Barkacs, L., Herron, D., & Dhooge, L. (2016). Biblical worldview edition of dynamic business law. N. J. Kippenhan (Ed.). New York, NY: McGraw Hill Education.
“The gathering place – trademark details.” Justia. Retrieved from https://trademarks.justia.com/854/69/the-gathering-85469710.html
Welsh, D, Davis, A., Desplaces, D., & Falbe, C. (2011). A resources based view of three forms of business in the startup phase: implications for franchising. Journal of Small Business Strategy, 22(1), 47-65.
SECOND REPLY……….. Jennifer Augustin
Business Form that Best Suits Shania’s Business Goals
When considering a Limited Liability Company (LLC) versus sole proprietorship, in Shania’s position, the safest choice would be to choose an LLC. The biggest risk with the sole proprietorship is the personal assets that legally can be seized, compared to an LLC that would only have liability in the assets tied to the business (Kubasek, Browne, Barkacs, Herron, & Dhooge, 2016). As an example, if a lawsuit were to come forward from someone slipping on a slick floor in the coffee house, in a sole proprietorship, the owner’s house, car and any other personal assets may be at risk. By obtaining an LLC for Shania’s coffee house, it provides protection for her personal assets.
Franchise Versus Independent Coffeehouse
In a comparable coffee house franchise, Lasaters Coffee & Tea®, requires a 10-year contract, no additional royalties and the initial startup costs are between $257,500 – $309,500, as well as, a $35,000 one-time franchise fee. As a requirement, you must have $60,000-90,000 in liquid assets in order to start your coffee shop. Store design, training and equipment are part of the initial costs (Franchising, n.d.). Shania would not be required to negotiate equipment or supply costs, but would be required to own and operate particular machinery and sell specific products.
As an independent coffee house, Shania would lack the brand recognition, but would potentially need far less in initial investment. She would have the flexibility to design and implement her business the way that she intended. If she has previous barista experience, but does not have the required $35,000 and $60,000-90,000 in liquid assets to invest, then she may be wiser to open her own independent coffee house.
The Availability of Trademarking the Coffee House Business Name
The Gathering Place has trademarked the name in the state of Colorado. The Gathering Place is a non-profit refuge for women, children and transgendered. Although they are not in competing markets, a trademark infringement may be claimed, because it may be confusing to people as to the affiliation of each organization. The Gathering Place does not have a religious affiliation and is very inclusive to individuals. If individuals in need see a coffee house with the same name sake, they may falsely believe that they are affiliated, and assume the refuge shares the same values or that the two are connected.
Also, Shania may receive more or less business based on the beliefs of others. The Gathering Place is a supportive operation to women and children, as well as those that are transgendered. Those that are against the LBGT community may boycott the coffee house. Carlos suggested marketing the coffee house to the Mormon temple. 114 individuals were surveyed that identified as transgendered and Mormon, what was concluded was that a majority of those surveyed did not feel accepted within the Mormon church, as well as, confusion within the Mormon community of gender identities other than male and female (Sumerau, Cragun, & Mathers, 2016). It is not recommended that Shania name her coffee house “The Gathering Place”, instead she should choose another name that does not have a trademark within the state of Colorado.
Shania is the owner, as well as the management. By having a mature Christian serve in the owner/management capacity, she would have a direct influence on the values that the company would hold (Wood & Heslam, 2014). Shania’s husband, Marvin, stated he wanted little to do with the business other than to provide capital, therefore would not have a direct role in the business. Assuming that since Shania is opening a coffee house, she would have background knowledge of how to make coffee, Shania would initially be the barista trainer. She should consider cross training Kelsey and Carlos on how to make beverages and any of the baked goods.
Kelsey would be a cashier and a barista, assuming she would be an honest, hard worker. She has not worked outside the home in a while, and her husband does not support her endeavor, therefore a compromise would be if her hours coincided with her children’s school schedule. By having a job that did not interfere with her children’s obligations, but still having the ability to work out of the house may be a fair solution. Having Kelsey’s excitement about the business and Christian background would prove to be an asset for Shania. Shania may want to consider to hire Kelsey at a lower end job, with the potential to promote as the coffee house grows. Her husband must be supportive in his wife’s endeavors, as the Bible says in Philippians 2:3, :”Do nothing out of selfish ambition or vain conceit. Rather, in humility value others above yourselves” (NIV). Kelsey’s husband needs to be supportive in her aspirations. With the narrowed way of thinking, his wife cannot make possible what she sets out to do.
2 Corinthians 6:14 discourages believers and non-believers in business partnerships, “Do not be yoked together with unbelievers. For what do righteousness and wickedness have in common? Or what fellowship can light have with darkness” (NIV)? Carlos may not have the Christian point of view, but by being immersed in a Christian environment, Carlos may be encouraged to explore the Christian faith. Shania is the shepherd, and the employees are her flock. This could be an opportunity that is mutually beneficial for Shania and Carlos. Carlos seems like he is progressive in his thinking, trying to think of applicable markets for the coffee house, Shania could share the Christian faith with Carlos and also gain an employee that is wanting the coffee house to be successful.
Carlos would be a good fit for marketing, as he is already looking for new target markets to approach. However, Carlos needs to conduct more research on those markets in which he intends to reach. For example, Carlos suggested reaching out to the Mormon temple. Mormons refrain from caffeinated beverages, such as coffee and tea, and treat their body as an earthly temple; therefore he may try the approach of marketing healthy baked goods (“The Word of Wisdom Helps Us Care for Our Bodies and Spirits”, n.d.). As suggested previously, it would be recommended that Carlos is also cross trained in the barista position and how to make any of the bakery goods. By Shania training all of her employees in each position, it gives her the flexibility and increases her chances of having a successful business.
Franchising. (n.d.). Retrieved June 30, 2018, from https://lasaterscoffee.com/franchising/
Kubasek, N. K., Browne, M. N., Barkacs, L., Herron, D., & Dhooge, L. (2016). Biblical Worldview Edition of Dynamic Business Law. N. J. Kippenhan (Ed.). New York, NY: McGraw Hill Education.
Sumerau, J. E., Cragun, R. T., & Mathers, L. A. B. (2016). Contemporary religion and the cisgendering of reality. Social Currents, 3(3), 293-311. doi:10.1177/2329496515604644
The Word of Wisdom Helps Us Care for Our Bodies and Spirits. (n.d.). Retrieved from https://www.mormon.org/beliefs/word-of-wisdom
Wood, E. A. S., & Heslam, P. S. (2014). Faith and business practice amongst christian entrepreneurs in developing and emerging markets. Koers – Bulletin for Christian Scholarship, 79(2) doi:10.4102/koers.v79i2.2131