Archive for the ‘Business and Economic System’ Category
Private sector plays major role in capitalist or market economic system. Private investment, management and control dominate in private sector. The forms of business firms in private sector include partnership firms, sole proprietorship, private limited companies and public limited companies. The sole proprietor or sole trader is an individual who invests, owns, manages and controls the business. The individual invests his own and or borrowed capital, manages and business, bears all the risks alone, enjoys all the profits and suffers from all the losses. Thus the sole proprietor is the sole owner, manager, controller, strategist, policy maker, risk-bearer, financier all rolled in to one. The advantages of sole proprietorship form of business include ease facility of formation, quick decision making prompt, action, establishment of maximum personal contact with customers, confidentiality of business decisions, flexibility, lower costs of management etc.