7 Benefits of Being a Sole Trader: A Guide for Export Managers
Are you thinking of starting your own export business? If so, you might be wondering what is the best legal structure for your venture. One of the most common and simple options is to become a sole trader. This means that you are the only owner and operator of your business, and you are responsible for all its aspects, including finances, taxes, and legal issues.
But what are the benefits of being a sole trader? And how can you succeed as an export manager in this competitive market? In this article, we will explore seven advantages of choosing this business model and offer some tips on how to make it work for you.
1. Easy to set up and run
One of the main reasons why many people choose to be sole traders is that it is very easy to set up and run. You don’t need to register a company name, file annual reports, or pay any fees to start your business. All you need is a valid tax identification number and a bank account. You can also use your own name as your business name, or choose a trading name that reflects your brand identity.
As a sole trader, you have full control over your business decisions and operations. You don’t need to consult with anyone else or follow any rules imposed by shareholders or directors. You can also change your business structure or direction at any time, without any legal complications or costs.
2. Flexible and adaptable
Another benefit of being a sole trader is that you can be flexible and adaptable to the changing needs and demands of your customers and the market. As an export manager, you know how important it is to stay on top of the trends and opportunities in the global trade sector. You need to be able to respond quickly and effectively to new challenges and opportunities, and adjust your strategies and plans accordingly.
As a sole trader, you have the freedom and agility to do just that. You can tailor your products and services to suit different markets and niches, and experiment with new ideas and innovations. You can also scale up or down your business as needed, without having to worry about the impact on your partners or employees.
3. Low overheads and tax benefits
Being a sole trader also means that you have low overheads and tax benefits. Unlike a company, you don’t have to pay any corporate tax or dividends tax on your profits. You only pay income tax on your personal income, which can be lower than the corporate tax rate depending on your circumstances.
You can also claim deductions for many of the expenses related to your business, such as travel, equipment, marketing, and training. This can reduce your taxable income and increase your cash flow. However, you should keep accurate records of all your income and expenses, and consult with a professional accountant or tax adviser if you are unsure about anything.
4. Personal satisfaction and fulfillment
Being a sole trader can also give you a lot of personal satisfaction and fulfillment. You are working for yourself, not for someone else. You are pursuing your passion, not just a paycheck. You are creating something valuable, not just following orders.
As an export manager, you have the opportunity to make a positive impact on the world by facilitating international trade and cultural exchange. You can also build meaningful relationships with your customers, suppliers, and other stakeholders in the industry. You can enjoy the rewards of your hard work and achievements, and take pride in your accomplishments.
5. Creative expression and innovation
Being a sole trader also allows you to express your creativity and innovation in your business. You are not bound by any corporate policies or procedures that might limit your vision or potential. You can use your unique skills, talents, and ideas to create products and services that stand out from the crowd.
As an export manager, you can also leverage your knowledge and experience in the global trade sector to find new ways to solve problems, improve efficiency, and add value to your customers. You can also collaborate with other sole traders or professionals in the industry to learn from each other and generate new insights.
6. Learning and growth opportunities
Being a sole trader also provides you with many learning and growth opportunities. You are constantly exposed to new situations and challenges that require you to think on your feet and adapt quickly. You are also responsible for all aspects of your business, which means that you have to learn new skills and knowledge in areas such as finance, marketing, legal issues, customer service, etc.
As an export manager, you also have the chance to expand your horizons by exploring new markets and cultures around the world. You can also attend workshops, seminars, conferences, or online courses that can help you improve your skills and knowledge in the industry.
7. Work-life balance
Being a sole trader can also help you achieve a better work-life balance. You have more flexibility and autonomy over your schedule and workload. You can decide when, where, and how much you work, depending on your personal preferences and goals.
As an export manager, you can also take advantage of the technology and tools that enable you to work remotely and efficiently. You can communicate with your customers and suppliers via email, phone, or video calls, and use online platforms and software to manage your orders, invoices, payments, etc. You can also travel to different countries and regions as part of your business, and enjoy the diversity and beauty of the world.
How to succeed as a sole trader export manager
Being a sole trader has many benefits, but it also comes with some challenges and risks. You have to deal with the competition, the uncertainty, the isolation, and the stress that come with running your own business. You also have to bear all the liabilities and losses if things go wrong.
So how can you succeed as a sole trader export manager? Here are some tips to help you:
Do your research
Before you start your business, make sure you do your market research and understand the needs and expectations of your target customers. You should also research the legal and regulatory requirements for exporting goods and services to different countries and regions, and comply with them accordingly.
Plan ahead
Having a clear business plan can help you set realistic goals and objectives for your business, and measure your progress and performance. You should also have a financial plan that covers your income and expenses, your cash flow, your taxes, and your contingency fund.
Network and collaborate
Being a sole trader doesn’t mean that you have to work alone. You can network and collaborate with other sole traders or professionals in the industry who can offer you advice, support, or referrals. You can also join trade associations or organizations that can provide you with resources, information, or opportunities.
Market yourself
Marketing is essential for any business, especially for a sole trader. You need to promote your brand identity and value proposition to your potential customers and differentiate yourself from your competitors. You can use various channels and methods to market yourself, such as social media, websites, blogs, newsletters, podcasts, etc.
Deliver quality
The most important factor for your success as a sole trader export manager is the quality of your products and services. You need to deliver what you promise, meet or exceed your customers’ expectations, and provide excellent customer service. You should also seek feedback from your customers and use it to improve your offerings.
What Is a Sole Trader?
A sole trader is a type of business structure that is owned and run by one person. A sole trader does not have any partners or shareholders, and is not a separate legal entity from the owner. A sole trader can use their own name or a trade name for their business, but they must register it with the appropriate authorities if it is different from their legal name. A sole trader is entitled to keep all the profits of the business after paying tax, but they are also liable for all the losses and debts of the business. A sole trader may hire employees or consultants, but they are ultimately responsible for all the business decisions and activities.
Global Demand for Sole Traders
Sole traders are the most common form of business in many countries, especially among small businesses and self-employed individuals. According to the U.S. Small Business Administration, there were 25.7 million sole proprietorships in the U.S. in 2020, accounting for 73% of all businesses. In the UK, there were 3.5 million sole traders in 2020, making up 59% of all businesses. The global demand for sole traders may vary depending on the economic conditions, the regulatory environment, and the preferences of consumers and entrepreneurs. Some factors that may increase the demand for sole traders are:
- The flexibility and autonomy of running a business by oneself
- The low cost and ease of setting up and closing a sole trader business
- The potential tax benefits and deductions for sole traders
- The ability to adapt quickly to changing market needs and customer preferences
- The opportunity to pursue a personal passion or interest as a business
Some factors that may decrease the demand for sole traders are:
- The unlimited liability and personal risk of being a sole trader
- The difficulty of raising capital and accessing finance as a sole trader
- The lack of protection and benefits for sole traders compared to other business structures
- The competition from larger and more established businesses
- The challenges of managing all aspects of the business by oneself
References:
https://www.ssm.com.my/sites/default/files/guidelines/OWNER%20RESPONSIBILITY_new.pdf
https://www.gov.uk/set-up-sole-trader
https://cdn.advocacy.sba.gov/wp-content/uploads/2021/04/21172832/2021-Small-Business-Profiles-US.pdf
https://www.gov.uk/government/statistics/business-population-estimates-2020/business-population-estimates-for-the-uk-and-regions-2020-statistical-release-html
https://www.gov.uk/set-up-sole-trader
https://www.export.org.uk/page/Starting_to_Export
https://www.business.gov.au/Planning/Business-structures-and-types/Sole-trader
https://www.fsb.org.uk/resources-page/what-is-a-sole-trader.html
https://www.thebalance.com/advantages-of-being-a-sole-trader-393505
