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Mind Map (Sole Trader (Disadvantages (Long Hours, Lack of continuity -…
Mind Map
Sole Trader
Advantages
Easy to set up - no legal formalities
Able to establish close personal relationships
Owner keeps all of the profits
Owner has complete control
Disadvantages
Long Hours
Lack of continuity - business ceases once owner dies
Difficult to raise capital
Often faces intense competition
Unlimited Liability
Partnerships
Disadvantages
Profts are shared
Often faces intense competition
Potential for conflict
Unlimied liabilty
All partners are bound to decisions made by any of them
Advantages
Greater access to Capital
Greater opportunity for specialisation between partners
Shared decision making
Business losses shared between partners
Shared responsibility
Business based on interests or skills of the owner/s