Business owned and controlled by a single person is known as sole trading business.
The following are the characteristics of a sole trader:
1. Ownership by one man: This is owned by single person. The sole trader contributes the required capital.
2. Freedom of work and Quick decisions: The sole trader is the owner, so he need not consult with others. Hence he can take quick decision.
3. Unlimited liability: When his business assets are not sufficient to pay off the business debts he has to pay from his personal property.
4. Enjoying Entire Profit: All the benefits earned by the sole trader is enjoyed by him alone.
5. Absence of Government Regulation: A sole trading concern is free from Government regulations. No legal formalities are to be observed in its formation and management.
6. Maintenance of Secrecy: Since the trader manages all the affairs of the business, the secrecy can be maintained easily.
