Advantages and Disadvantages of being a sole trader

touch on traders argon the most common form of seam organizations. peerless person provides the permanent finance and, in return, has full simplicity of the business. Sole traders pass water a variety of advantages and blemishs.

Firstly, bushel traders have limited liability which means that their personal possessions and property cig art be taken to pay off the debts of the business if it fails. A sole trader organization is easy to set up, as there are hardly any legal formalities. The induceer has complete control of the business and is able to keep totally profits made. Since a sole trader manages their business altogether on their own, they do not have to answer to anybody else as they would in a partner ship situation. They are able to choose times and patterns of working that are suitable for them. The business can be based on the interests or skills of the owner, sooner than working as an employee for a larger firm. Decision purely

However, although the advantages of beingness a sole trader make this organization building seem very appealing, it also comes with a number of drawbacks and disadvantages. Sole traders have unlimited liability meaning that all of the owners assets are potentially at risk.



This makes it difficult for the owner to raise surplus capital is they are purely dependant on their own savings, profits made and loans for injections of capital. Even though a sole trader can choose times and patterns of working, longs hours are practically necessary ti make business pay.

Another major disadvantage is that the owner is unable to specialize in areas of the business that are most interesting. They are responsible for all areas of management. This can be a tough and effort consuming duty. As legion(predicate) sole traders remain small in order to remain...

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