Some entrepreneurs dream of creating a huge company, employing hundreds.
Others would rather be a “one-person show” as a sole proprietor.
A sole proprietorship is owned and run by one individual who receives all profits. It has the benefit of being relatively easy and inexpensive to establish.
Of course, that only tells part of the story. There are several disadvantages to sole proprietorship to be aware of and guard against as well.
My name is Sam Mollaei, and as a Business Lawyers for Entrepreneurs, I can help you decide what type of business organization – including sole proprietorship – might be right for you.
And of course, if you have any questions about your unique situation, feel free to email me.
By the end of this post, you’ll know what the disadvantages of sole proprietorship are so you can make an informed decision as to whether this business structure is right for you.
1. Your Liability Is Unlimited
The most serious disadvantage of being a sole proprietor is unlimited exposure to liabilities and lawsuits.