Sole Traders
This is the smallest and simplest form. One person owns a business as a sole trader. There are sole traders in all sectors of the economy. Farmers, hairdressers, plumbers and small shop owners are all examples of sole traders.
Although only one person owns the sole trader business, it is possible for a sole trader to employ workers, so sometimes there is more than one person working in the business.
Advantages
They are very simple to set up, there is no time-consuming paperwork and no need to publish financial information.
Disadvantages
However, there are a few disadvantages to being a sole trader. The main disadvantage is that sole traders have unlimited liability so he/she is the only person liable for any debts the business may have. Also since the sole trader is the business, if he/she dies, the business may also come to an end. Another disadvantage that sole traders can face is a lack of capital as only one person puts money into the business.