3 FEATURES OF SOLE PROPRIETORSHIP
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Answer:
1. One Man Ownership:
In proprietorship, only one man is the owner of the enterprise.
2. No Separate Business Entity:
ADVERTISEMENTS:
No distinction is made between the business concern and the proprietor. Both are one and the same.
3. No Separation between Ownership and Management:
In proprietorship, management rests with the proprietor himself/herself. The proprietor is a manager also.
4. Unlimited Liability:
ADVERTISEMENTS:
Unlimited liability means that in case the enterprise incurs losses, the private property of the proprietor can also be utilized for meeting the business obligations to outside parties.
5. All Profits or Losses to the Proprietor:
Being the sole owner of the enterprise, the proprietor enjoys all the profits earned and bears the full brunt of all losses incurred by the enterprise.
6. Less Formalities:
ADVERTISEMENTS:
A proprietorship business can be started without completing much legal formalities. There are some businesses that too can be started simply after obtaining necessary manufacturing licence and permits.