What type of business is owned by a single individual?

A business owned by a single individual is referred to as a proprietorship, commonly known as a sole proprietorship. This type of business structure is characterized by the fact that one person owns and operates the business, making all the decisions and retaining all the profits. The simplicity of establishing a proprietorship allows for easy setup, with minimal regulatory requirements and limited paperwork, making it an attractive option for many small businesses.

In a sole proprietorship, the owner is personally liable for all the debts and obligations the business incurs, which emphasizes the personal risk associated with this structure. This feature sets it apart from corporations and partnerships. While corporations are owned by shareholders and partnerships have two or more owners, a proprietorship focuses solely on the individual owner. A cooperative, on the other hand, is an organization owned and operated by a group of individuals for their mutual benefit, further distinguishing it from sole proprietorships.