What is one advantage and one disadvantage of being a sole trader?

Advantages: The business is cheaply and easily formed as there is no long legal process. Owner gets to keep all the profits. Owner gets to make all the decisions.* Close links with both employees and customers. Financial affairs are kept private.Disadvantages: Unlimited liability which means debts of the business can extend to personal possessions. Responsible for all the losses. Sole traders have to raise their own capital and can have difficulty getting loans. Sole traders have no one to share decisions with.* Hard work and long hours. Lack of continuity. *Some points can be positive and negative based on explanation.

CS
Answered by Conor S. Business Studies tutor

4635 Views

See similar Business Studies GCSE tutors

Related Business Studies GCSE answers

All answers ▸

What are some of the most relevant pricing strategies?


Ella's Delicatessen has monthly fixed costs of £1800. She sells her soup for £1.15 a carton. The variable costs per carton are: (raw materials = 45p) and (labour = 20p). Calculate her breakeven output per month (show your workings)


How can a company benefit from economies of scale?


What role does motivation play in the workplace?


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

MyTutor is part of the IXL family of brands:

© 2025 by IXL Learning