A sole proprietorship is probably the easiest form of business to create. But, there is some sentiment out there that you should avoid forming a sole proprietorship. Yet, most businesses are still sole proprietorships. So, how do you decided? What factors should be taken into consideration when deciding what form of business to create? Thoughts?

Most business minds negate the idea of sole proprietorship. First, they are not satisfied with the liability risks of this form of business. It also has limited access to capital. The business also does not progress once the owner is declared bankrupt, insane or dead (Vietzen, 2015). There is also no tax benefit. However, despite all the negative claims and reviews, most people still have a preference for it given its advantages such as its simplicity in formation and maintenance, in addition to the owner having cheap labor from family and friends and enjoying all the benefits (Vietzen, 2015). Some essential that should be examined before starting up a business include; ease of forming the business and raising capital, the legalities required, the customer base, possibility of being expanded among other key factors. One a personal stance, starting up a business should be based on and driven by the passion, preference, talent, and intention of the owner.

References

Vietzen, L. A. (2015). Law Office Management for Paralegals. Wolters Kluwer Law & Business.