Sole proprietorship

Automatic the moment you start selling. No formation cost, simplest taxes — but no legal separation between you and the business, so personal assets are exposed to business liability.

LLC

A registered entity that generally separates personal and business liability. Costs a state filing fee plus annual maintenance, and requires keeping business and personal finances truly separate to hold up.

How sellers usually decide

Many start as a sole proprietor while testing the model, then form an LLC once inventory spend, employees, vehicles, or a warehouse lease enter the picture.

Either way

Open a dedicated business bank account, keep clean books, and carry appropriate insurance. Structure alone does not protect sloppy records.