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The Difference between Sole Proprietorship and PartnershipShare:
Can you manage enough to make money alone? or you may need somebody’s help to succeed in your business goals, which is which? Are amenable to work alone without the ideas and opinions of somebody else? There are factors to consider in establishing business strategies and its advantages and disadvantages.
Definition of Sole Proprietorship
It is a type of business in which only one person is the owner of the business. The person uses his capital, knowledge, skills and expertise to run a business solely.
Definition of Partnership
It is a business form in which two or more persons agree to carry on business and share profits and losses mutually. It is an agreement between partners in sharing of profit and loss.
1. Profit and Loss
Sole proprietor is the only handler of all income and profit of the business. Partnership always shared in agreed ratio.
2. Business Privacy
Sole Proprietorship acquires all business information will be discreet by the owner itself and Partnership requires business secrets to be opened to every partner.
Sole Proprietorship is minimal in raising capital fund because it solely manages the accounts. It would be comparatively high in Partnership.
4. Duration of Business Operation
The duration of a sole proprietorship would be uncertain as it depends on the stability of sole owner and operator. While in partnership, it will be based on the desire and capacity of the partners.
5. Decision Making
In Sole Proprietorship, people can decide quickly and Partnership, there would always be delay in decision-making because it always depends on the decision and plans of the partners.