SOLE

PROPRIETORS
HIP
PARTNERSHIP
AFREEN MUHAMMAD
 SOLE
PROPRIETORSHIP AND
PARTNERSHIP -
FEATURES, MERITS,
Today, we will explore two common forms of
business ownership: Sole Proprietorship and

AND DEMERITS
Partnership. These structures are fundamental to
business and entrepreneurship, each off ering
distinct benefi ts and challenges. By the end of
this seminar, you will better understand their
features, merits, and demerits.
SOLE
PROPRIETORSHIP
A sole proprietorship is a type of
business structure in which a
single individual owns, operates,
and is fully responsible for the
business. It is the simplest and
most common form of business
ownership.
 KEY FEATURES OF SOLE
PROPRIETORSHIP
01 02 03
Single Ownership: Full Control: Unlimited Liability:
Only one person owns The owner has The owner is
the business. complete decision- personally
making power. responsible for all
debts.

04 05
No Legal Easy Formation and
Separation: Dissolution:
Minimal legal formalities are
The owner and
needed to start or end the
business are treated
business.
as one entity.
 MERITS &
DEMERITS
MERITS DEMERITS
• Simple Setup: Easy and cost • Unlimited Liability: The owner's
effective to establish. personal assets are at risk.
• Full Profit Retention: The owner • Limited Capital: Resources are
keeps all profits. restricted to personal funds or loans.
• Complete Control: Quick decision- • Limited Growth Potential:
making without the need for Expansion is challenging due to
consultation. capital limitations.
• Tax Benefits: Business profits are • No Continuity: The business may
taxed as personal income, avoiding end if the owner is incapacitated or
corporate tax. passes away.
• Flexibility: The owner can easily • Heavy Responsibility: The owner
change business direction or must manage every aspect of the
operations. business, which can be burdensome.
PARTNERSHIP
A partnership is a collaborative
business arrangement where two
or more individuals, companies,
or organizations collectively own
and manage a business venture.
Partners pool their resources,
expertise, and eff orts to achieve
common goals, and collectively
reap the rewards and assume the
risks, liabilities, and
responsibilities associated with
the business.
 KEY FEATURES OF
PARTNERSHIP
01 02 03
Joint Ownership: Shared Responsibility: Unlimited Liability
Two or more Partners (General
people co-own the share management Partnership): Partners
business. duties and decision- are jointly responsible
making. for debts.

04 05
Partnership Agreement: Profit and Loss Sharing:
The business is governed Profits and losses are
by a formal or informal divided according to the
agreement between the agreement.
partners.
 MERITS &
DEMERITS
MERITS DEMERITS
• Access to More Capital: Each Unlimited Liability: In a general
partner can contribute financially, partnership, each partner is personally
increasing business resources. liable for the business.
• Shared Workload: • Potential for Disagreements: in opinion
Responsibilities are divided among may lead to conflict.
partners, reducing individual stress. •Shared Profits: Profits are divided
• Diverse Expertise: Partners bring among partners, reducing individual
different skills and knowledge.
earnings.
• Simple to Form: Less regulatory
• Limited Continuity: The partnership
complexity than other business
may dissolve if a partner leaves or dies
structures.
unless there's an agreement in place.
• Flexible Structure: The
• Complex Decision-Making: Involving
partnership agreement allows for a
multiple partners in decisions can lead to
tailored business structure.
delays.
COMPARISO
FEATURE SOLE PARTNERSHIP
PRIOPRIETOR
SHIP
Ownershi Single Two Or
p Owner More
Unlimited
Liabilit Unlimite (General
Partners)
N y d
Full Shared
Decision-
Control Decision
Making By Owner Making
Profit 100% to Shared
Distribution Owner Among
Partners
Capital Limited to Better Access
Owners To
Access Resources Capital
Setup Simple More
Managemen And Complex
lowcost And Formal
t
 Flexibility: Sole
Unlimited Liability: Both
proprietorship allows quick
structures expose decisions, but partnerships
personal assets to benefit from shared
business risk. expertise.

Control and Decision-Making:

Sole proprietorship allows for IMP Taxation: Both structures

ELEME
allow for pass-through
full control, while partnership
taxation, but tax implications
involves shared decision-
differ based on profit-sharing
making, which can lead to

NTS
in partnerships.
conflict.

Capital Access: Partnerships Risk of Disagreements:

generally have better access Differences in opinion can
to capital, making them more lead to conflicts between
suitable for growth-oriented partners, potentially affecting
businesses. business operations.
• Sole Proprietorship
off ers simplicity, full
control, and profi t
retention but involves
unlimited liability and
limited growth
opportunities.
• Partnership off ers
shared
responsibility, better
access to capital, and
diverse expertise but
introduces risks of
 CONCLUSION
In summary, both Sole Proprietorship and
Partnership off er distinct advantages and
challenges.
Choosing between them depends on
factors such as control, risk tolerance, and
capital needs.
THANK YOU
LEEBA MAM
FOR THE
CHANCE
THANK
YOU
VERY
MUCH!