Assuming that you would be operating as a single member LLC, there is no tax advantage in operating as a SMLLC as opposed to a sole proprietor. Operating results for both entities are reported to the IRS on Schedule C. Depending upon the state, there will be various fees, etc. that will need to be paid as a LLC.
As to possible legal liabilities, I trust that you are being named as an additional insured on your vendors’ product liability insurance. Given the litigious nature of many people today, if you sell a product to a customer and they receive a serious injury while using the product, you can be sure that you will be sued (along with just about anyone connected to the product). Will they prevail against you? Maybe not, but why take the chance?
What about if someone falls gets injured in your store as a result of a wet floor? While I am sure your insurance will cover it, you never know. An LLC will help shield your person assets from any judgment. I would suggest that you check with your insurance agent and your attorney to make sure.
Ed Baloga, CPA / MBA