2. Group » MBA 2nd Semester
Nazish Masood R# 434 Sidra Riaz R# 429 Syeda Fatima R# 427
Arif ullah #463
3. Overview
• Describe characteristics of a sole proprietorship.
• List advantages of a sole proprietorship.
• List disadvantages of a sole proprietorship.
6. A sole proprietorship is a
business entity with a
single owner/operator.
A business entity is a
professional organization
offering something that
has real existence.
The following factors
characterize a sole
proprietorship.
7. A. It is the oldest, most
common, and simplest
form of business
organization.
B. One person can serve as
the business decision-
maker.
C. No registration with the
state is required, as is
necessary with a
corporation or a limited
liability company (LLC).
8. D. It is easily set up and
maintained.
E. The owner is personally
responsible for assets,
income taxes, and
business debts.
F. It is relatively simple to
manage and control.
9. A sole proprietorship has several
advantages.
A. The owner is his or her own boss.
B. No legal formalities are involved in
forming or dissolving the business.
C. The money the business makes
belongs to the owner.
D. Decisions can be made quickly.
10. E. Start-up costs may be
minimal.
F. A sole proprietorship is a
good type of organization
for a business:
1. That will remain small
2. That does not have great
exposure to liability
11. A sole proprietorship has
several disadvantages.
A. Raising capital to start the
business is difficult.
1. Banks are less willing to lend
money to one person for a
business venture.
2. Banks that approve loans
may have higher interest
rates.
12. B. The owner has unlimited
liability.
Both the business and personal
assets of the sole proprietor are
subject to the claims of
creditors.
When the owner assumes
unlimited liability, he or she
may lose all personal and
business assets to pay bills or
money owed to other parties.
C. The business ends if the
owner dies.
13. G. The sole proprietor must
pay a self-employment tax,
which consists of
contributions to Social
Security and Medicare.
In addition, he or she must
pay estimated taxes
throughout the year.
H. The sole proprietor may
have to register the business
name and pay local taxes
for owning a business.
14. Laiba’s Collection (2001)
Sole Proprietor Business
Owner Miss Naheed Akhtar
Initial investment 2000 rupees
Currently has assets of worths 0.3 million (2013)
Current outlet Hayatabad Phase 7
Contact 091-5863429
Supported by WBDC and SMEDA
15. Laibas Collection mission is to offer quality clothes
in an assortment of sizes and styles to accommodate
all varying body styles and shapes to satisfy their
customers with all aspects of their needs and also by
providing quality tailoring on spot
16. To capture the local market and to compete in the
competitive environment
17. The business deals in ladies garments
Embroidery
Bridal wears (ready made & on order)
Casual wears (ready made & on order)
Small kurtas for baby girls
Bed sheets and complete bed sheets (on Order)
Tailoring facility on spot
18.
19. To promote the labor present in the villages near
D.I.Khan (kaneri village)
To provide them with employment opportunities
To provide customers with better services
