Sole-trading is a very simple and most common type of business. The owner of these types of businesses is solely responsible for the entire business and everything involved. The owner receives all of the profits, and is responsible for all losses and debts. Small shops and small service businesses are normally a form of sole-trading.
Examples:
-Bakeries
-Salons
-Floral Shops
-Photography
-Hairdressers
-Plumbers
Examples:
-Bakeries
-Salons
-Floral Shops
-Photography
-Hairdressers
-Plumbers
Advantages-Easy to organize
-Permits a high degree of flexibility for the owner -Some creditors are willing to extend credit because of the liability on a small business -The owner receives all of the profit |
Disadvantages-Has limited resources
-The owner is responsible for all damages, payments, and debts -Creditors may force the sale of personal and business property -Limited life (if the owner passes away, the business could potentially end) |
Photo Credits:
http://knowledgebridge.ca/wp-content/uploads/2012/11/mam_colas_flowershop.jpg
http://knowledgebridge.ca/wp-content/uploads/2012/11/mam_colas_flowershop.jpg