Incorporate Pass-By Businesses, Destination Businesses, and Virtual Businesses

There are various different types of businesses when it comes to site selection. The three main categories that most business owners deal with are pass-by businesses, destination businesses, and virtual businesses. Each of these have their own pros and cons.
Pass-by businesses survive by the quantity and quality of the traffic that flows in the streets in front of their location. These are the businesses that customers visit typically because they are on their way to something else. They can include restaurants, hair salons, retail stores, and other commodity service oriented businesses. The best location for these businesses are next to similar establishments or around traffic drivers such as Wal-Mart or HEB. Signage and visibility is extremely important to these businesses.

  Destination businesses can be a little more liberal in their site selection. Typically these businesses will draw clients from further distances and thus may not require a location near a traffic driver. Some of these businesses include theme parks, speciality shops, or expert service providers. While the business itself will drive the customers to its doors, the business owner may have to allocate a large amount of resources to let its target market know about the businessí existence and location. On the flip side, these businesses typically command a higher selling price per unit.
Vitual location based businesses are entities that do not require a brick and mortar location, but are typically homebased businesses that the customers only visit via the internet or over the telephone. These businesses include web-based businesses, plumbers, electricians, and other service providers that visit the client at their home.While the lack of a true store front saves the businesses owner some expenses, the marketing of the businesses is paramount to the survival of these entities.

  In order to detemine under which category your business falls, simply ask yourself these questions, ìDoes the client need to visit my store, and if so, will that person travel out of their way to come to my store?î If the client never has to visit you, then itís a virtual or homebased location. If they do need to visit you, but will not travel out of their way to do so, then your business is a pass-by business. On the other hand, if they will travel out of their way, then it is a destination business.

Incorporate in New Mexico (Nmprc)


A corporation is the most complex and formal
business structure. A corporation exists as a
distinct legal entity. As a legal ìperson,î separate
from its owners, the corporation can make its own
contracts, raise capital, assume liability, and ó
just like the rest of us ó pay taxes. Corporations
are usually formed by the authority of a state
government. In New Mexico, they are governed by
the New Mexico Public Regulation Commission
(NMPRC).

If you wish to establish a corporation, specific
statutory criteria must be met. (see Are Your
Papers In Order?)
Having a corporation may provide you with
a vehicle for raising capital through the sale of
shares of stock to either selected individuals or the
general public. While shareholders own the corporation
and select the management, they are generally
not liable (in their roles as owners) for claims
against the corporation beyond, of course, the
amount they invested in the stock.

The corporationís status as a separate legal
entity provides for continuity of existence. Death
of an officer, director or stockholder, or the transfer
of shares, for example, do not result in the termination
of the corporation. Its management can continue
to conduct business as before.

Advantages:

ï Limited investor liability
ï Transferability of ownership
ï Separate legal ìpersonî
ï Continuity of existence
ï Access to investment capital
ï Delegated authority to hired
  management

Disadvantages:

ï Complexity of formation
ï Double taxation
ï Charter limitations and

Government Regulations

ï Administration of corporate structure
ï Dissolving the corporation can be
  expensive