Seek help to launch family restaurant

Dear Bruce: I am starting a small pizza business with my brother in Connecticut. The business will serve approximately 40 to 50 diners at a time as well as take-out service. Would forming a limited liability company be the right thing to do? We will employ only my brother and I full-time and five additional people part-time, as well as our children, who are of working age. I look forward to your answer. – D.C., via e-mail

Dear D.C.: I am not against starting any enterprise that is not incorporated. I’m sure you’ll realize that you also will have to get a federal ID number, workers’ compensation, a sales tax number and all the other little things that all of us business people are required to do.

You should talk to a competent accountant about setting up all of these accounts and use an attorney to put the LLC together. You mentioned your children are of working age. I don’t know of any exclusion from requirements with regards to Social Security contributions, particularly when they will be working for a corporation. You say you’ll only be employing you and your brother, your kids and five additional people. That’s a pretty good-size operation. You should start from Square 1 doing it right and that requires the services of a competent accountant to apply for all of the things that you mentioned, an insurance agent who knows his or her business and makes certain you are covered for all eventualities and, of course, the attorney. Best of luck.

Dear Bruce: My wife and I have an idea for a product, which is currently used in the medical field but has a practical use at the retail level. Can we do this, or would the patent on the original products prevent it? If we are able to get a patent, where do we begin: online, eBay, direct distribution and retail stores? It seems to require a lot of time and money. – J.S., via e-mail

Dear J.S.: If you had a patent, say, on toilet paper and you found a use for filling cracks around windows with it, this would not change the basic protection for the material. Your observation that getting a product to market is a very expensive venture is astute and accurate. While places such as the Internet and eBay are very inexpensive, introducing a new product through these mediums, while not impossible, is extraordinarily difficult. The conventional avenue – distributors, retailers, etc. – surely has great possibility of success but entails very large expenditures of money.

Dear Bruce: I am self-employed. Two years ago, I purchased a second existing business doing the same thing as the one I am now running. From almost Day 1, the business at the new place started declining and there seemed nothing that I could do to prevent it. Last June, I closed the doors and put the building up for sale. The building still has not sold. I have had a lot of people wanting to buy, but they mostly lack financing. For the last two months, I have borrowed money from my open credit line that I have for my other business to make the payments and other monthly expenses. In two more months real estate taxes are coming due. I am presently just making interest payments, but feel I cannot go on doing this.

Do I need to get an attorney and find out my options? I do not want to lose my other business and my home over this building. I am truly afraid and do not know what to do. My wife is feeling the same. Anything you can offer is truly appreciated. – S.M., via e-mail

Dear S.M.: It appears to me that the building is overpriced. Now, it might be that you paid too much, or your expectations are too high. When real estate doesn’t sell, there is either a problem with the land, or the building is overpriced. Overpriced is simply defined as more than a willing buyer is able to pay.

You asked if you needed an attorney. You are selling real estate – of course you need an attorney. How much of a beating you’re willing to take on this transaction is another matter.

One problem: You have to know when to hold and, more importantly, when to fold. This might be the time to lick your wounds and get on with your life.

Bruce Williams is a national radio talk show host and syndicated columnist.

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