Sole Traders

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Sole Traders

Advantages

  • They're easy to set up.
  • You get to be your own boss.
  • You alone decide what happens to any profit.

Disadvantages

  • You have to work long hours and you don't get many holidays.
  • You have an unlimited liability. So if the business goes bust owing £10 million, you may have to sell everything you own to pay your debts.
  • Sole traders are unincorporated. The business is not legally separate from its owner. So if someone dies from eating a dodgy dover sole, they sue the fishmonger personally - not the business. Or the fish.

Evaluation

Most small businesses are sole traders. You don't need to do anything apart from start trading. Examples include: plumbers, hairdressers, newsagents and fishmongers.

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