Business

Business Tips & Info



Sole Proprietorship

Sole proprietorship is the simplest and most common form of ownership for small business.

A sole proprietorship is owned by one person. The owner decides what products to sell or what services to provide, how much to charge, when the business will be open etc. If you choose this option nothing legally separates you and your personal finances from those of your enterprise and your business is taxed through the personal income tax you pay.

There is no limit to the amount of profit your business could make and the owner also has unlimited liability. This means that the owner is responsible or liable for all debts or losses that the business owes. If the business owes more than it owns, the owner may have to sell personal property ( for example a car or house ) to pay the debts of the business. If the business earns a profit, the owner gets to keep everything that is left over after income taxes and other expenses have been paid.

There are both advantages and disadvantages to a sole proprietorship.

ADVANTAGES:

Low start-up costs.

Greatest personal freedom and totally on your own. No one can tell you what decisions to make or how to run your business.

You receive all the profits and that could increase your motivation.

Ability to change business direction or practices very quickly.

Few legal restrictions.

Easy of starting or discontinuing business.

Losses incurred during your first few years can be claimed to reduce taxes on other sources of your personal income.

You don't have to share the business secrets with anyone.


DISADVANTAGES:

Totally on your own, no one to give you new ideas or help you with certain decisions, except your chosen advisors.

You are the only liable if your business fails.

It is harder to borrow money because there's no partner to share the debt load.

No one can easily take your place if something happened, and no one have the same commitment to your company as you do.

Long hours of work.

When your business becomes more profitable and generate more income than you currently require you will be taxed at higher personal tax rates.


Related Links:

Partnership

Incorporation

Buying An Established Businesss

Buying A Franchise

The Business Fundamentals

Using Professionals

The Lawyer

The Accountant

The Banker

Market Research

Your Products or Service

Your Customers


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Negative phrasing can be damaging in your marketing campaign and advertising project, silently destroying it from the inside. When you are designing marketing campaign and advertising for your business, stress the positive, not the negative. You'll gain far more customers and new business that way. Although this has been proven time and again, many businesses keep right on sending negative ads to their customers and prospects, and most do it without even realizing it. Learn more...



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Did You Know?

Experience has shown that the more focused you are about your target market, the greater your chances of success. You must identify as precisely as possible WHO will buy from you and WHY.

Any target market is broken down into smaller groups or segments known as market segments. The most common market segments are based on age, income, ethnic background, geographic location and education. Find out more...