The meaning of Sole-proprietorship business

                   ILLUSTRATION 

One thing that business closely resembles, is a school project. Yes, we could liken business to a school project. We discovered certain similarity between business and a school project. All of them involves activities. A school project may consist of academic activities like; researching, recording of findings, discussion on findings. While, a business may consist of commercial activities like; production, trading, service rendering, purchasing, packaging or branding etc. You would realize that a student could carry out a school project alone, or do it as a team with others. Sometimes he might be at liberty to decide if he would alone or carry it out as a team. When they have liberty, some students would choose to perform the activities alone. Others may opt to perform it with a group. 

One thing is true about the activities; it must be performed. As it is with the project so is it with business. The person desiring to pursue business as a career must indulge in activities of business. He or she may choose to engage in the project alone, or with others. He is at liberty to make his choice. 

The example of the student who chooses to perform his project alone, illustrates perfectly what sole proprietorship means. It means a business established and managed by an individual.

                    DEFINITION    

Sole proprietorship is a form of business that is established; financed, managed by an individual with the aim of making profit. 

If you choose to undertake sole proprietorship it means you want to pursue the activities of a business alone. You want to own your business alone. No one else besides you would be the shareholder. You want to manage it alone. No one but you would sit down to think and come up with strategies, or implement orders. It is as if you want to treat it as an affair no one has right to interfer with.

                SECONDARY NAME

Some entities have many names. A friend of yours may have more than one name, or a nickname apart from his real name. If you do not want to call him by his name, you may address him with his nickname. Sole proprietorship is one kind of entity that has not just one name. It has another name, which is; 'One Man Business'. Throughout history it has come to be identified with this name. When people do not call it sole proprietorship, they call it, 'One man business'. Do not think they are talking about another thing if you hear them mention that title.

The title is befitting in that it is revelatory of the forger of the business, and indicative of the nature of the business; a business formed by one person. 

                  THE FORGER

If you undertake the establishment of this kind of business, you are a sole proprietor. The person who establishes a sole-proprietorship is called a proprietor. That is how they are refered to all over the world. Whenever you come across anybody that has established a business that has the nature of sole proprietorship, you can call him a proprietor. Throughout history the term has been used as a designation for owners of sole-proprietorship and distinguishes them from others. What distinguishes the forger of sole-proprietorship from every other business structures is the number of forgers. It is the only kind of business with a single former. Not more than one person establishes it.

He undertakes the activities of business establishment, which leads to his establishment.

     CHARACTERISTICS OF THE PROPRIETOR

1. The major attribute of the proprietor is formation. His efforts resulted in the formation of the business. When the steps that requires business creation is taken, creation becomes inevitable. And it is usually the result of his steps.

2. He manages the business; He controls the business policy, direction and overall affairs. The depth of his influence covers every affair of the business. His input into the business the capital and certification as the sole owner, gives him unquestioned advantages over sovereignty of business.

3. He reaps the dividends: Having no other shareholder besides him, the proprietor receives not a percentage of the profits, but full. 

4. Liabilities and risks are beared by him. Since sole-proprietorship is a ship captained by an individual. He alone faces all the danger he might encounter on his way.

                     OBJECTIVE 

Generally the proprietors aim at profit. They start this kind of business to make money. We know this because they monetize their business. They do not give out their products for free. They do not render services for free. When you want them to meet your demands you pay them for it. They engage in steps to achieve profit making.

                THE BENEFICIARY

It is a truism, that profits for every business is due the establishee. Consider; If you planted a fruit tree, in your garden, you would be the only one that has right to reap it's fruits. Except you choose to share the fruit with others, you are the only one that has the right to reap it. And so is it applicable with every business. Without a doubt therefore, the profits drawn from sole proprietorship businesses are due the sole-proprietor. He it is that provides the capital and took the steps to forge it after

CHARACTERISTICS OF SOLE PROPRIETORSHIP 

Too many are this kind of business. When we x-ray all of them, we would find certain things they all have in common, that defines them. I present to you 6 characteristics of sole proprietorship.

 1. FORMATION IS DONE BY ONE MAN

The law is that only one person can establish this kind of business. If more than one person establishes it, it is no longer a sole proprietorship, because by standard and tradition only one man owes this business. In imitation of tradition, those who want to establish this kind never indulge others in the formation. The capital is sourced by him. The business plan is written by him. 

 2. MANAGEMENT IS DONE BY ONE MAN

Management in a sense, is exercise of sovereignty. Sovereignty of a business is due the creator. The proprietor secures the sovereignty by establishing the business. No one besides the proprietor chariots the business. He controls the affairs of the business; the policies, the direction, and over all management. There is no such thing as members coming together for a meeting on what to do and when. The proprietors takes all decisions, weather it is favourable or not. 

  3. IT IS VOID OF LIABILITY PROTECTION 

In some countries there is no legal protections given to Proprietorships to restrict those they owe, from seizing their properties to compensate for their debts, as is with other business. 

 4. ONLY THE PROPRIETOR OWES THE BUSINESS

They usually do not involve others in establishing the business. They establish it alone, and certify theirselves as the owners. In the cases where they have to collect permits, they register only their name to it, which makes only them, the owners. It is not in tune with the standards of sole proprietorships to have more than one owner. If a business has more than one owner, then it is not a sole proprietorship. The most distinguishing feature if this business from others, is ownership by an individual. As we have observed, all sole proprietorships have one owners only. It is unheard of for sole proprietorship to have more than one owner.

  5. ALL THE RISKS ARE BEARED BY THE PROPRIETOR

If you own a business alone, you would also bear the risk alone. But if you own it with others, they would share it with you. It is like being on a ship alone, no one else is journeying with you, to help pull you out if you are drowning. No one else is usually victims of risks besides the proprietors.

6. PROFIT IS REAPED BY ONLY THE PROPRIETOR

What makes one a beneficiary of a business is ownership. If you do not own a business, you do not have access to it's profit. 

Having no other person as co-maker, the sole-proprietor stands as the only beneficiary, and usually reap the dividends of their business alone.