Co-Op

[MikieTaps]

Hey Guys and Gals,

Here is what I am looking to do.

I want to rent/lease a small warehouse mostly just to store, and to work out in when its raining, Caveman Training type equipment. Big Ass tires, chains, med balls, weights, sandbags, etc...

I have a few friends that are interested in splitting the rent with me. I am wondering if there is a way I can set up a co-op or something legal entity that I can get people to "buy into" or join, where they will be liable for their portion of the rent legally every month... mostly I am trying to figure out how to protect myself.

I was thinking about setting up a LLC and selling memberships, but I would like to avoid the headaches of the accounting/legal/tax issues that brings up... I am a CFO for a Tech Start up... I have enough headaches to deal with as it is.

Does anyone have any advice on any formal "business structures" or "co-op plans" I should consider, or is there anything I am missing, like needing insurance etc... Thanks!

[LisaS]

ADA and access issues seem to always come into play for things like this - if there is a restroom it needs to be accessible, etc. Not sure where the private vs. public lines are drawn for something like you are proposing & the ADA.

[MikieTaps]

Thanks for the quick response!

I really am trying to make it kind of a hang out for my friends, but I want to shed some of the risk.

[VoloInnovations]

THe Co-op idea always has appealed to us although we have a traditional company. But the thought of everyone being involved in the ownership will hopefully get everyone thinking about the space and equipment respectfully - perhaps not such an issue with caveman type training but you will be suprised the things you will end up haveing to fix/maintain/clean!!!

I think there is substantial paperwork to maintain a co-op and annual meetings and quorums that must be present so If it is just for fun it may simply be too much work. Get in touch with a lawyer about what is required to maintain a co-op annually. YOu may also have to do a higher level of tax returns for the co-op which could also increase your annual expenses significantly.

Good luck!

[drjamesroman]

I don't think from a legal standpoint setting up a co-op would be a good idea. I don't think you really need to go to that much trouble. If the other trainers sign the lease they are already liable for their part of the contract. Also, be careful when setting up this type of business structure. The more people you have involved in any particular business the greater the chance for failure. They're is a saying in business, "Partners are for Dancing." And that's it. Most people want to work with a partner because they think that they will get an extra person's effort and help with running a business. This rarely ever works out. Most of the time, one person ends up working harder than the other partner and it ends up tearing the business relationship apart. I would not set myself up in business with anyone other than myself. If you want to get more information on Fitness Business Management, check out my FREE business coaching blog, www.myfitnessmarketing.com

Dr. Roman