Starting your own business (legal questions)

J

jimbowie7

Joined
Mar 13, 2005
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I was thinking of starting up my own LLC (Limited Liability Company) for making knives. However, I'm not sure what I should be using to describe the business?

There are several categories such as "Manufacturing," etc. (But unfortunately no "knifemaker" or "bladesmith" status). I'd be interested to hear what anyone else has used that has set up their own LLC.

By the way, I believe Spyderco is set up as a "Design" company, I guess this gives them flexibility to develop a wider range of products down the road. Should I be going this route too in case my interests change? I doubt it, as once you've made your first knife, you're hooked! ;)

Thanks! :thumbup:
 
who exactly would be involved in production, if it's just you I don't know what the advantages of an LLC would be over a sole proprietorship
 
I'd recommend you talk with your attorney AND accountant.

For me, in Indiana, a Sub S corp. was the best decision, based on probably more accounting benefits than legal benefits.

It would be nice to think a Sub S corp or LLC would limit liability to assets of the organization should there be a concern with something that would test that, but as a good friend, who is also an attorney said, "You are the sole stockholder, and the only employee of the corp. No litigating attorney worth his salt would go after only the corp and not you individually as well should there ever be a misshap with one of your knives and one of your customers.."
The best way to avoid litigation is to do your best to make your best knives.
Oh, and I said "manufacturing" as a category....advise of accountant every bit as important as advise of attorney....
 
Talk with your insurance company also about proper coverage and the unforseen, like Joe Blow coming by your shop unannounced to visit, walking into your shop and cutting himself and then deciding to sue you, or loss due to theft, and windstorms and stuff like that.

STR
 
I went through this for my day job, and I think John R. has some good points. This is a place to get good advise from pros that you trust. For me, an LLC didn't quite do it legal, tax, accounting wise but I imagine every situation is different.
Best of luck, Craig
 
hardheart said:
I don't know what the advantages of an LLC would be over a sole proprietorship
Click to expand...

A corporate entity shields the owner from liability, where as a sole proprietorship does not.

JB7: don't rely on us goofballs; contact the Small Business Administration for info, then see a lawyer who practices in this area.

cheers
 
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