What are the desadvantages of sole trader?

Answer 1

Sole traders face several disadvantages, including unlimited liability, meaning their personal assets are at risk if the business incurs debt. They may also struggle with limited access to capital, as funding options are often restricted compared to larger businesses. Additionally, sole traders often bear the full burden of decision-making and responsibilities, which can lead to increased stress and workload. Finally, they may find it challenging to compete with larger firms that have more resources and economies of scale.