Question

If you were to do business today would you do it as a sole trader? Write an evaluative essay justifying your decision to do business as a sole trader.

Answer 1

Answer: Yes if I were to do business today I would do it as a sole trader.  When thinking about opening my own business, I might well have given some consideration to becoming a sole trader. Sole trader is also known as a sole proprietor. It is also one of the most popular, for a number of reasons, including the ease with which a business can be set up using this form. However, there are pitfalls to be aware of. A sole proprietorship is a business owned by one person, who has full control of the business and how it is run. They also own all the assets of the business and any profit that it makes. In the same vein, they are also responsible for all the debts and liabilities the business accrues. A sole trader is expected to register as self-employed with HM Revenue & Customs and will be required to submit an annual self-assessment, but generally speaking their accounting requirements are less onerous than those of a limited company. It is a common belief that setting up as a sole trader is the cheapest option for starting a new business.

There are some advantages of becoming a sole trader:

1. Control – Sole traders maintain full control of their business. Running it how they please without the interference of others.
2. Profit retention – Sole traders retain all the profits of their business.
3. Private data – Information about sole traders is kept private, unlike that of limited companies which is necessarily made public after registration with Companies House.
4. Specialist – Often a small business, sole traders can offer a more personal service with local roots and ties. This can be more appealing to potential customers in the local community.
5. Personal – Because there is no need to confer with other decision makers, sole traders can make decisions quickly and act on them swiftly, providing for the needs of their customers.

Now, for becoming a sole trader I need to take some decisions like:

I would like to Hire Help: If you I am operating as a sole proprietorship, I am the solitary owner, but I don't have to do all the work myself; I can always hire employees. Whether I am operating out of my home or from a business location, consider adding at least one part-time person to improve customer service. My clients want to have personal interaction with me, and they may have questions about our service or bill. If I hire a virtual personal assistant, I can train him to give customer service like I would, freeing him to sell products or perform services for other clients.

I would also study the prices: Research my pricing strategy would help me a lot. Survey my customers or other small businesses to see what they are charging for the same service. If I find myself in the bottom of the price range, then I can decide if I want to raise my prices for all customers or just for new customers. For existing customers who balk at a price increase, consider keeping their price the same.

I would say Thank You: Thanking my clients for their business. It's common for sole proprietors who work on commission, such as real estate agents, to give a gift to their clients when the sale is complete. If I choose to give a gift, I may be able to write it off as a business expense. Another option is to give a gift to each client once a year, such as at Christmas or on the client's birthday.

I would go online: I would love to expand my product or services to consumers outside my community. If I work from home or an external location and provide a service, such as consulting or freelance writing, I can help customers online. Compare the benefits of starting a website with the benefits of using social media network profiles to spread the word about my service. I am legally responsible for my website, and therefore I want to use online marketing strategies only if I have the time to monitor the website or social media accounts and respond to customers who contact me online.