The fear of loss acts as a stimulant for hard work. Besides, it makes him very cautious in his approach. Hard work and cautious approach bring him more reward and improves efficiency and economy of the business .

Sole proprietorship is also called as Entrepreneurship.

Decision arrived at, after deep deliberations and discussion are sure to be better than that of a decision taken by one man. It is rightly said two heads are always better than one. The chances of wrong decision- making are quite high in a sole trader business.

The non-corporate enterprises are sole trading concern, partnership firm and Joint hindu family business.

Single person's intelligence and experience may not help him beyond a certain stage. Since he has to focus on each and every activity. his managerial ability is bound to be limited.

(i) It is a highly flexible type of organisation.
(ii) A sole proprietorship concern is generally run on a small scale basis.
(iii) A change in operation is possible without involving much expenditure.
(iv) The proprietor can adapt and adjust to the changing trends and market conditions because the sole trader is the sole owner of his business.

Sole Proprietorship is a form of business organisation in which an individual introduces his own capital, uses his own skill and intelligence in the management of its affairs and is solely responsible for the results of its operations.

Grocery store, medical store, craft centre, legal consultancy, internet cafe, freelance writer, tutoring, catering company are some of the examples of sole trading businesses.

Ownership by one man:
The sole trader contributes the required capital. He is not only the owner of the business but also manages the entire affairs.
Freedom of work and Quick Decisions:
Since an individual is himself as a owner, he need not consult anybody else. Hence he can take quick decisions.
Maintenance of Secrecy:
In sole proprietorship as the sole owner manages all the affairs of the business, the secrecy can be maintained easily.

High credit standing of a sole trader refers to his prompt repayment of loans borrowedn from creditors. Sothat he canborrow more funds fromcreditors to expand his business activities.
(i) Increase in sales: Since the sole trader gets more funds from his creditors due to his credit standing he can satisfy the requipements of his regular consumers based on their tastes, preferences, likes and dislikes, etc., whereby the sole trader can increase the sales in his business.
(ii) Smooth running of the business: When adequate funds are there ill a sole trading business then the sole trader can avoid the various hindrances in his business and also he is able to solve his employees problems in business. So that the sole trader can run his business very smoothly without any difficulty.
(iii) Inexpensive management: Due to high credit standing of the sole trader he can effectively manage his capital in a prudent way and can avoid wastage [OR] unnecessary expenses in the business which will lead to inexpensive management.
(iv) Efficiency: Better financial performance by way of good profitability condition in sole trading business and achieving the desired results in the business by constant hardwork leads to efficiency in sole trading concern.
(v) Threat of loss: Fear of loss always cautions the sole trader's credit standing and acts as a stimulant for hard work and effective management of funds borrowed.
(vi) Flexibility: A sole trader can change. his nature. of business according to the prevailing market situations and grab up the business opportunities through his capital investment.
Conclusion: Finally to conclude, high credit standing of a sole trader leads to efficiency in his business. More funds borrowed may be used in a wise way in sole trading business.

One-man control is the best in the world:
William R. Basset has said that one-man control is the best in the world only when the business is small indeed, to allow one actually to know and supervise everything in the business.
Following are some of the points in favour of one-man control:
(i) Easy and quick formation,
(ii) Direct control,
(iii) Efforts and reward are linked,
(iv) Retaining business secrets,
(v) Close touch with the consumers,
(vi) Enjoying all profits,
(vii) Inexpensive management,
(viii) No legal restrictions,
(ix) Direct contact with the employees and
(x) Social desirability.
Limitations of one-man control:
Though there are many advantages of one-man control, still it suffers from many drawbacks. One man is unable to manage all the affairs by himself. Basset says, "The danger is always present that he thinks, he knows which really he does not know".
Following are some points unfavourable for one-man control:
(i) Limited capital,
(ii) Limited managerial ability,
(iii) Unlimited liability,
(iv) Absence of large-scale business operation,
(v) Risky decisions and
(vi) Uncertainty.
In conclusion, one-man control is the best from the point of view of profitability and efficiency,provided that one man is big enough to manage everything efficiently.

The following are the disadvantages of a Sole trader:
a) Limited Capital:
Since the capital is contributed by one individual only, business operations have necessarily to be on a limited scale.
b) Limited Managerial Skill :
(1) Single person's intelligence and experience may not help him beyond a certain stage.
(2) Since he has to focus on each and every activity, his managerial ability is bound to be limited.
c) Unlimited Liability:
1. The liability of the proprietor for the debts of the business is unlimited.
2. The creditors have the right to recover their dues even from the personal property of the proprietor in case the business assets are not sufficient to pay their debts.
d) Lack of Specialisation:
Since the business unit is small and the financial resources are limited, experts in different fields cannot be employed to secure maximum advantages.
e) Hasty Decisions:
Sole proprietor is more likely to take hasty decision as he need not consult anybody else.

The following are the advantages of a Sole trader:
a) Easy Formation:
No legal formalities are required to initiate a sole trading concern. Any person capable of entering into a contract can start it, provided he has the necessary resources for it.
b) Incentive to Work hard:
There is a direct relationship between effort and reward. The fact that the entire profit can be taken by himself without sharing with anybody else induces him to work ceaselessly.
c) Small Capital:
Small capital is an important as well as the specific advantage of the sole proprietorship. The sole proprietor can start the business with small capital.
d) Credit Standing:
Since his private properties are held liable for satisfying business debts, he can get more financial assistance from others.
e) Personal Contact with the Customers:
Since sole proprietor knows each and every customer individually he can supply goods according to their taste and preferences. Thus he can cultivate personal relationship with the customers.
d) Flexibility:
The sole trader can easily adjust himself to the changing requirements of his business.