Business Start Up Help: 3 Disadvantages of a Sole Proprietorship

Getting the proper business start up help can assist you in deciding what type of business to start. A sole proprietorship is one of the most commonly used business models today. Here are a few of the disadvantages of a sole proprietorship. 

1 - Liability

When you are a sole proprietor, you are going to assume all of the liability for your business. You are going to be responsible for repaying all of the debts that are incurred for your business. You will also be risking your personal possessions if a client sues you.

2 - Getting Capital

As a sole proprietor, it can also be very difficult to get financing for your business. The lender is simply going to look at your personal situation when determining whether to give you capital or not. This can make it very difficult to get the money that you need for your business when you need it.

3 - Less Professional

Another disadvantage of using a sole proprietorship is that it is going to look unprofessional in the eyes of potential customers. People like to deal with businesses instead of individual people. Therefore, you might have trouble getting enough business to stay afloat with this business model.

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