IGCSE, A Level Business Student Forum

Q1 Analyse the advantages of a sole trader. [6]

Possible Structure:
[KN]
[AN]
[AN+]

[KN]
[AN]
[AN+]

(kn) you are the boos
(an) you don't have anyone interfering in your business
(an+) thus making in easier to make decisions
(kn)you keep all the profit
(an)you make all invest and at the end you might get double the amount
(an+) which keeps the owner motivated to keep running his business with good quality products

[KN] Full Control over the Business
[AN] Sole traders have complete control over their business operations, they make all the decisions that are important for the business which helps them to be their own boss without any hesitations.
[AN+] Thus Leading to higher output as no one else will have having any right to interfere into his business.

[KN] Working hours flexibility
[AN] Sole traders would have choices at what time they want to work or at what time they cannot which helps them to work more smoothly
[AN+] Thus the sole trader gets motivated and thus leading to higher efficiency levels

[KN] Complete control on the business.
[AN] Sole traders have full authority of the business which means thats no one else can take the profit or interfere.
[AN+] This leads to increase in savings of the owner.
[KN] Information about the business is not necessary to be shared with others.
[AN] Sole trader business can have complete secrecy in business matters which means its not necessary to share the information with others.
[AN+] This leads to betters ideas for the business.

[KN] Flexibility in decision making
[AN] This agility allows them to respond promptly to market changes, customer demands, or emerging opportunities.
[AN+] It's an advantage that can help small businesses adapt and innovate more efficiently than larger, more bureaucratic organizations.
[KN] Privacy
[AN] You're not required to disclose financial information, business strategies, or internal operations to shareholders or partners.
[AN+] This discretion can be advantageous for individuals who prefer to keep their business dealings private or need to protect sensitive information in competitive markets.

Farzan Siddiqui wrote: ↑Tue Oct 31, 2023 9:34 pm [KN] Complete control on the business.
[AN] Sole traders have full authority of the business which means thats no one else can take the profit or interfere.
[AN+] This leads to increase in savings of the owner.
[KN] Information about the business is not necessary to be shared with others.
[AN] Sole trader business can have complete secrecy in business matters which means its not necessary to share the information with others.
[AN+] This leads to betters ideas for the business.

In the second further analysis instead of saying it can lead to better business ideas you can say that the business can become more competitive and gain hand as if their developing a new product it won't get leaked and their competitors won't know about important information such as the profit their making or their costs.

[KN] Full control
[AN] Sole traders take complete control of decision-making to directions to employees
[AN+] They don't need to consult anyone for decisions and due to fewer interruptions, the owner has better control of businesses.

[KN] Direct profits
[AN] Sole traders do not have to share profits, unlike shareholders.
[AN+] This allows owner to earn more profit and will enable them to reinvest in businesses.

[kn] sole trader can make his own decisions about the business.
[an]sole trader did not have to worry about the partners as he can make his own decisions and can implement changes without the need of consensus froma partner or a board of director
[an+]this make sole trader confident about his decision .
[kn] no profit share of the business.
[AN]the sole trader make his decision to invest his profits b buying capital '
[AN+]thus there is no risk of share of profit .

[kn] complete control and greater flexibility
[an] as a sole trader u don't have to follow anyone rules as u have full owner ship of all the aspects of s business
[an+] helping to operate the business according to your on visions and preferences
[kn]ease of establishment
[an] as a sole trader when business is set up costs are usually low
[an+] which also provides them with the advantage of being able to easily change there organizational structure as business grows

[KN]full control and decision making abilities
[AN]this allows for quick decision making and the ability to respond quickly to market changes or customer demands
[AN+]It also means that you can align the business with your vision and values without having to consult or compromise with partners or shareholders.

[KN]direct financial benefits
[AN]This means that you do not have to share profits with partners or investors.
[AN+]You get to keep all the earnings, which can lead to potentially higher personal income if the business is successful whihc u can use to reinvest into the business

(Kn) full control without being answerable (an) since a sole trader has one owner he is not accountable to any other owner and can make his own decisions (an+) this increases efficiency as the person wont have to waste time consulting with the owners if there were any or giving them reports
(Kn) all profits kept (an) the profits do not have to be shares with anyone (an+) this encourages the sole trader to work harder in order to attain more profits

[KN} working for urself
[AN] being an sole trader the business means that you are the boss and you are not working for anyone
[AN+] This gives them freedom

[KN] profit
[AN] your income solely depends on your efforts on the business
[AN+] this gives them the confident for earning for themselves

[KN] You get to keep all the profits
[AN] As a sole trader the owner gets to keep more retained profit and can easily invest in the expansion or further introduce new technology into the business
[AN+] Thus without any disturbance from the shareholders the owner can easily make decisions regarding the business and can cause improvement in the business

[KN] Full control over the business
[AN] Sole traders take complete control of decision-making to directions to employees or regarding the decision of the prices of products etc
[AN+] They don't need to ask for advice from others and the owner has better control of businesses.

[KN] Full authority over the business
[AN] This help a sole trader to make decisions for the business like setting the price of products or what salary should give to the employee
[AN+]Thus sole trader is free to make decisions which help to run the business smoothly without any interference .

[KN] The profit is all yours
[AN] This help the sole trader to reinvest easily into new technology and make the businesses more capital intensive .
[AN+] Thus because of any shareholder not in the business the owner will invest more and more to make it business profitable.

[KN]Complete control over business
[AN]Since the sole trader is the only owner he can make decisions on his own
[AN]this allows for a quicker decision making process helping to improve efficiency


[KN]No profit sharing
[AN] the sole trader gets to keep all profits earned to himself
[AN] this ensures maximum return on investment