1 Essential Question Define the term “Sole-Proprietorship” and explain the three advantages and the four disadvantages of operating a sole proprietorship Sole Proprietorships SECTION 1

2 So you want to have a business? Questions to answer… How hard to start? Start up costs, production costs, Laws or business regulations (Zoning Laws) How much control/responsibility do you want to have? More control= more responsibility How will you make profit (and make your profits grow?) Sole Proprietorships SECTION 1

3 What is a Sole Proprietorship: A business that is owned and operated by one person (You are CEO and Janitor) Oldest, Simplest, and common type of business organization Usually businesses are service based and require little start up capital. EX-plumbers, carpenters, hairstylists, or florists. Sole Proprietorships SECTION 1

4 Advantages to a sole proprietorship: easy to start up- don’t usually require much capital or legal considerations full control of the business by the owner- all business decisions made without consideration for partners or shareholders exclusive rights to profits by the owner Sole Proprietorships SECTION 1

5 Disadvantages to a sole proprietorship: unlimited liability by the owner- If business goes into debt, owner must pay all debts even if this means selling off personal prop. sole responsibility of the owner to operate the business (few day’s off/vacations) limited growth potential for the business lack of longevity of the firm- if owner gets sick or dies so does biz. Sole Proprietorships SECTION 1

6 Turn to page 146 in your book: As a class, Read the article on page 146 Copy down AND answer the two questions below in the body of your notes (right side) 1.) Describe the qualities that many Entrepreneurs possess 2.) Identify Mary Kay Ash and explain her success story as an entrepreneur. Sole Proprietorships SECTION 1