Choose your Business Structure

	Business Structure
	Prepare your Business Plan

Business Structure

1.	Sole Proprietorship
	Sole proprietorship is the simplest business structure, and the company is entirely owned by the business owner. It is suitable for small-scale businesses.
	Advantages: Business owners have the absolute power over decision making, and enjoy relatively high flexibility in running the company Easier book-keeping Owners simply need to complete the business registration procedures to get started - low registration and other administrative expenses     Disadvantage: Sole proprietors are personally responsible for all the liabilities of the business, and might have to pay creditors with their own property or other personal assets, should the company gets into any solvency difficulties
2.	Partnership
	Generally suitable for professional service companies set up by two or more people. Before starting a partnership, you should draw up a partnership deed to specify the sharing ratios of various partners. If there is no deed, the legal presumption is equal sharing among partners.
	Advantages: The range of skills and experience that partners can share and bring to the business Relatively simple business structure, only required to complete the business registration procedures to start up, relatively low registration and other administrative expenses Book-keeping is relatvely simple     Disadvantages: Partners are personally responsible for all the liabilities of the business, and might have to pay creditors with their own property or other personal assets, should the company gets into any solvency difficulties The partnership is subject to immediate dissolution in the event that any partner passes away, unless there is specific provision under the partnership deed to the contrary
3.	Limited Liability Company
	New Start-ups may consider forming a private limited liability company if their businesses may be exposed to substantial liabilities and credit risks. Owners of a limited liability company are called shareholders, who may appoint a board of directors to take care of the day-to-day business of the company. Shareholders can appoint themselves as directors. Under the current law, limited liability companies with only one director and shareholder are permitted to be incorporated in Hong Kong.
	Advantages: A limited liability company is a separate legal entity in law, and will be able to survive even in the unfortunate event that any shareholder or director passes away A limited liability company owns and assumes its assets and liabilities independently. Shareholders are not required to take up personal liabilities     Disadvantage: Required to file annual returns every year. Subject to higher administrative expenses

Top

Prepare your Business Plan

Ensure bank / lender understands your business needs. This is one of the keys to successful business financing. The most direct means to achieve this is to provide a detailed business plan along with your loan application form. The plan should include:

Your business model Specific purposes and use of funds Projection of net profit Evaluation of cash flows Development plans Production / trade pattern Sources of repayment

Download our Business Plan Template to draw up your scope of business and be well prepared for your loan application Call 24-hour Business Partner Direct 2198 8000 and we will help you to decide which financial solutions best suit your company

Top