A sole proprietorship is a type of business owned and operated by a single individual. This structure is simple to set up and requires minimal paperwork, making it a popular choice for small business owners. The owner has complete control over the business and is responsible for all profits and losses. In a sole proprietorship, there is no legal distinction between the owner and the business. This means that the owner is personally liable for any debts or legal issues that arise. Common examples of sole proprietorships include freelance work, small retail shops, and local service providers.