The organizer of the one-man concern invests his own capital and may also borrow .some. He rents a shop and hires the service of an assistant, if necessary. He himself makes purchases and personally attends to the sales. He is his own manager. He initiates. organisms, directs all economic activity and takes the entire risks. Thus, the sole proprietor combines in his person the function of capital. enterprise and even labor in many cases.


This form of business organisation offers several advantages:

(i) The combination of financial interest and the sole responsibility for running the business is conduce to efficiency.

(ii) All transactions.and operations are. through prudent management. performed

in the most economical manner: and waster of all kinds is eliminated.

(iii) It is possible to pay personal attention to all customers and give them entire satisfaction at minimum cost.

(iv) This form of business is also the easiest to start and the easiest to wind up. Limitations

But there are limitations also which the individual entrepreneur suffers:

(i) The capital at the command of the sole proprietor is generally meager.

Iii) Also, one reran feels very much handicapped in looking after the many sides of his business.

(iii) No first – rate business can be built up in this way.

(iv) It cannot enjoy the economies of large-scale production.

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