Leading a business as a sole proprietor is both challenging and rewarding. You are the only person who is responsible for making decisions about the organization, its direction, and whether or not it changes status to an LLC or another type of company. There is no one else to take the hit when something doesn’t go right. There’s also no one to share your successes with when the company excels. Below, you will find some important steps that sole proprietors should take as their businesses begin to grow from the Shapiro Law Group, P.C.
Have a Business Plan in Writing
A sole proprietorship does not have to legally be set up since you are operating as a company of one, but it is still important for you to have a business plan in writing. Having a plan in writing makes it easier to meet your goals, operate on a daily basis, and make sure you are performing the tasks you need in order for your business to succeed. A business plan also helps you understand the financial viability of your business and check if you are meeting the numbers necessary to grow.
Register a Fictitious Business Name
In the debate between sole proprietor vs independent contractor, one consideration is whether to register a fictitious business name. Independent contractors often operate their business under their own name. For example, if you are a marketing professional and your name is John Doe, your business name will simply be John Doe. Sole proprietors can also use their given name as their business name. When your company begins to grow, you may want to register a fictitious business name to operate under. John Doe could become JD Marketing.
Even though you are a sole proprietorship, you will still need to draft contracts for various reasons. One of those reasons is to provide your services to clients (either individuals or other companies). You should never perform any work without a contract of some kind in writing. Contracts will help protect your investment and prevent you from providing services that wind up not being paid for by the client.
Other contracts you might need to draft are sole proprietorship and partner agreements. Have you decided to partner with a friend or family member? If so, you absolutely need a contract to protect your interests in the business. As always, it is best to draft sole proprietorship contracts with the help of a business attorney.
Reduce Your Liability
When you operate as a sole proprietorship, you assume all of the liability for your company. This means that if you are sued by anyone, you are held personally responsible for the lawsuit and settling it. If this is the case, you could wind up being on the hook for a large amount of money changing hands. Work with an attorney to try and reduce the liability your sole proprietorship faces on a daily basis.
Speak to an Experienced Business Law Attorney Today
When you are working as the sole proprietor of a business, you need to have an experienced business law attorney to help you make decisions, guide you in the right direction, and help with sole proprietor contracts. Call the experienced team from the Shapiro Law Group, P.C. at (617) 431-8468 to schedule a consultation.