Friday 5: why avoid sole proprietorship

In starting and growing a consulting business, you face many decisions. One of the earliest decisions you need to make involves the structure of your business. Should you set up a sole proprietorship, partnership, corporation or some other structure? Nina Kaufman offers this discussion of the reasons to avoid sole proprietorship.

However, even if sole proprietorships offer some drawbacks, you shouldn’t beat yourself up for running one. Incorporation involves a higher level of organization, record keeping and business management. Sole proprietorships can be extremely flexible — and they’re cheap and easy to set up. I launched as a sole proprietorship and, although I now have more than one business, I still enjoy the flexibility of such a business structure.