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
