Sole trader



Sole trader

One person provides the permanent finance and in return, has full control of the business and is able to keep all of the profits.

Advantages

  • No legal formalities, easy to set up
  • Complete control
  • Keeps all the profits
  • Chooses time and pattern of work
  • Close relation with the employees
  • Privacy
  • Business is based on interest/skills of the owner

Disadvantages

  • Unlimited liabilities, may lose all assets
  • Competition from firms
  • Difficult to raise additional capital
  • Long hours
  • Unable to specialize
  • No continuity. As the owner dies, the business dies





Rating 3.00 out of 5


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