Businesses that are best suited for sole proprietorship



Company registration is extremely important for every business in order to protect your business and secure its rights. It protects you from risks and losses and at the same time shields the business from personal liability, more capital contribution, more customer attraction, greater stability and grooms the company’s potential...

There are various forms of businesses available that one can register with. Hence, you should have clarity on the type of your business, your goals and objectives since each of these types come with their own legal implications. Among all, online sole proprietorship registration is the most simple one with minimal compliance procedures. The sole proprietorship is the “One Man Business Entity”. All the investments for the Sole Proprietorship business are done by a single proprietor who has complete control of the business as well as its management.

In this article, we’ll talk about the various businesses for which online sole proprietorship registration is best suited. Online Sole Proprietorship registration is very simple, but before going for it, you need to take care of some basic things like deciding a suitable business name and choosing a suitable location as the designated place for doing your business.

Let’s now understand what type of businesses should go for online sole proprietorship registration in India.

Lists of businesses most suitable for Sole Proprietorship

The organization should have the following features.
  • Minimal Capital requirements
  • Fewer Tax rates
  • Independent operations
  • Unorganized structure
  • Fewer operational risk & Low Compliance requirements

The list of businesses that are most suitable to go for online sole proprietorship registration are as follows -

Activities related to Retail Trading

The businesses involving retail trading activities such as household goods, electric goods, grocery selling, general store, merchandise, bakery etc. can be done with a very negligible risk by the sole proprietor. Capital requirements for initial investment are also very very less which helps the sole proprietor in choosing this business.

Services related to Repair & maintenance

The services related to repair and maintenance of automobiles, household appliances, electronic machinery etc. which are frequently provided at local shops, consumer places or garages can be the best suitable sole proprietorship business.

Small Scale home businesses

Small scale home businesses run with little capital requirements and with the help of a few members. It involves less risk that best matches with sole proprietorship business.

Local Transportation Services

The local transportation services like auto, e-rickshaw or minibuses require very less capital and just a few employees. It can best serve the interest of the sole proprietorship business type.

Software Consultancy services

This is a kind of service that requires basic system requirements and can be handled with a medium capital flow.

Tutoring services

Tutoring services are often provided by proprietors at home or at another suitable place. With the help of a few employees or on their own, the services can be provided as a proprietor keeping the whole sum of profit in the pocket.

Freelance Writers

Freelancers operate independently that require no capital and can operate from home also. Although starting a publishing company at the initial stage does not require an organized form of business with compliance requirements.

Clinic & medical management facilities

Most clinics and healthcare entities in their starting stage start as a sole proprietorship business. It can also be seen as a suitable sole proprietorship business type

Conclusion

This simplicity of online Sole proprietorship registration makes it popular among small traders and merchants. It’s also much cheaper, of course. This is the other reason why it’s the most widely used business structure. However, it also has disadvantages like Lack of Resources, Unlimited Liability, Lack of Credibility, issues in raising funds easily and inability to add Partners. Also, Sole Proprietorship can also hamper growth with time. After all, it’s difficult to build a big business as a single person. So, if one is looking to expand his/her business then it is advisable that this structure should be converted to another form once achieving growth to a sustainable level.


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