sole proprietorship and business risks
A sole proprietorship is one of the simple structures that applies to any new business. Opening a coffee shop is a highly developed and competitive business across different parts of the world. The company will focus on product and service innovation to attract new and keep the existing customers, and this legal structure will facilitate the process. It has to establish a unique image that allows customers to seek the services and products from the shop. The advantage of this ownership is that the owner will have direct access to profits and liable to different issues within the entity. Various liabilities, such as debts and other liabilities of the business, can be managed with minimal expenses. As a result, the owner has control over many risks that could expose the business to losses.
The taxation process is also simple, and this allows a business owner to manage different issues associated with over taxation. In the first year, the business will focus on mitigating risks related to the coffee selling business. One of the strategies is to develop an organized taxation structure. Besides, the process offers a reliable means of conducting loan repayment. Identifying the right financial models to facilitate the program will ensure that the business does run into losses in the first years. A sole proprietorship will provide this opportunity since it facilitates independent decision-making to the owner.
One of the ways to address these is to learn from its primary competitor and improve services to attract more customers within the first year of business. The other strategy is to explore opportunities noted in the region. An example of such opportunities is to expand to inland markets and other parts around the area. This is an essential measure in ensuring that the entity explores different markets at once. On the other hand, the entity will address the significant threat, such as competition, by building strong initiatives aimed at delivering quality brands and serving its customers.
Other business plan is to differentiate from the rest of the market in terms of product atmosphere and location. The idea is to establish a business at the beach park. This is an essential strategy as it would attract tourists and also create a unique environment where customers experience a different level of service from the normal coffee atmospheres. Many customers focus on the atmosphere that each store has, therefore the business will gain competitive advantage by establishing its services on this location.
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