Becoming your own boss sounds like a dream come true to many people who’ve spent far too many years toiling away in tiny corporate cubicles. Yet as wonderful as it may sound to finally leave behind certain types of supervisors and colleagues, striking out on your own often requires long hours spent completing projects for highly diverse clients. Furthermore, the financial side of being a sole proprietor can become rather intimidating – as client needs change and new deadlines hover on the horizon.
However, compared to partnerships, corporations, and other business structures, “a sole proprietorship is the simplest and most common structure chosen to start a business.” Since you won’t be incorporating your business – you’ll usually be viewed as being “one and the same” with the very work you do.
Here are some other factors that often provide positive benefits to sole proprietors.
Special Advantages of Being in Business This Way
You control nearly every aspect of your business. You choose your own work days and hours. Also, all profits belong to you (though you must keep up with all business debts);
Low start-up costs. As a sole proprietor, your legal costs for starting up your business will normally be quite minimal. However, in some cases, it will be up to you to build up an inventory of products to sell, and to obtain all required permits and licenses;
Simple tax requirements. Filing your annual tax return should be fairly simple, especially if you keep proper records throughout the year regarding all of your earnings and deductible expenses;
Disadvantages Facing Sole Proprietors
- You must generate business. You’ll need to become an excellent “rainmaker” -- someone who can find new clients and motivate them to make use of your services for extended periods of time;
- It’s up to you to locate all necessary funding for general business and marketing needs;
- Unlimited liability. You can potentially face unlimited legal liabilities for your work since you and your business are basically viewed as “one and the same;”
- Economic cycles and changes in workflow can greatly affect your bottom line. Sudden changes in your clients’ need can create major stress. It can also take time to figure out how to competently provide your services to numerous clients on an ongoing basis;
To obtain help with handling all of your Georgia business planning needs, please contact Shane Smith Law today. You can schedule your free initial consultation with a knowledgeable Peachtree City estate planning attorney by calling: (770) 487-8999.