What Are Sole Proprietorship Businesses
The different business types have their own pros and cons when it comes to their operation and overall structure. For this reason, determining the business type will help the owner or owners setup and create the organizational structure of the company.
In the current setting, individual enterprises are becoming common in various fields. Aside from being common, they are also simply structured and only require minimal capitalization. For these reasons, individuals with enough starting money and the courage to venture into a whole new experience, are more likely to start their own business. Hence, the start of Sole Proprietorship businesses.
Sole Proprietorship is the most basic business type, thus most common structure for small enterprises. In business terms, Sole Proprietorship businesses, otherwise called Sole Trades, fall under the umbrella of unlimited businesses and are owned by a single individual, thus the name. Being classified as an unlimited business, Sole Proprietorship businesses and their owners are considered as a single entity, thus the liability of the Sole Trade is the liability of the owner. In this setting, the single owner is bound to the company’s liability.
Now that the main points of the Sole Proprietorship type were laid out. The next thing for owners is to register the business with Suruhanjaya Syarikat Malaysia, or commonly known as SSM. In brief, SSM is the leading agency in the registration and regulation of all businesses in Malaysia. In this context, for any business to become a legal enterprise, it should be first SSM online registration.
In part of SSM’s effort to encourage businesses to register, the business registration process is made available offline and online. For offline processing, owners are required to visit the main office of SSM to submit the required forms and requisite documents. In addition, assessment and payment of fees are done physically. In contrary, for online registration, the owners need only to register with SSM’s e-registration platform and once registered, the online application can commence. For both methods, owners will be required to submit three company and/or trade names.
To distinguish, a company name is the legal name of the business. Whereas the trade name is the name that can be used for advertising or marketing purposes. For this reason, it is usually advisable to have a separate company name from the trade name. However, for both, it is recommended to come up with names that are related to the business or industry which are easy to remember and at the same time catchy. Once the Sole Proprietorship is registered, it becomes a legitimate and legal company that can operate in Malaysia.
Ultimately, knowing the basics about Sole Proprietorship is just the start of the very long road to success. With any business, there are invaluable steps to remember, these are to understand the structure of the business, to evaluate the pros and cons of the industry and to study the market. These may not guarantee instant success, but these are ways to ensure that the business is taking the right path towards prosperity.