1. Write short summary of any sole proprietorship summary in 5000 words.

(name,
location, nature of business, turnover, advantages, limitations, experiences, contact
number, learnings)

Name of the sole proprietorship: Zankar Gifts and

Toys
Location: Bazar Peth, Khopoli.
Nature of business: retailer and wholesaler of
products
Turnover: 10-15 lac.
Contact no: 8007491492

 ADVANTAGES OF SOLE PROPRIRTORSHIP

 Ease of formation: The main advantage of sole proprietorship is that it can
easily be formed by any person by undertaken any legal business for earning
profit.
 Sole authority: The owner of the business has complete authority to deal with
the affairs of business. He prepares the plain, invest his money, supervise the
business and enjoy the profit.
 Sole claim on profit: The owner of the business receives full profit earned from
the business.
 Flexible management:  The sole proprietor make prompt decision, in carrying
out policies, changes the methods of production, reducing or increasing the
prices, of the commodities, delegating responsibilities etc.
 Credit standing: The owner of the business enjoys an excellent credit rating
among the creditors.
 Legal status:  As the sole proprietor and the business have one personality.
Therefore, all the assets, liabilities, profits and losses on the part of owner.
 Secrecy: A sole trader being the owner of the business has high standard of
secrecy due to their own managing of the affairs of the business.
 Direct relationship with customers: A sole trader has closed relation with his
customers. Therefore, he offers everything according to the taste of the
customers. This creates his goodwill in the market.
 Benefits of inherited goodwill: The ownership of the business passes from
generation to generation thus enables the son to reap the benefits of goodwill of
his father.
 Tax advantage:  The sole proprietorship is taxed as personal income of the
owner. He does not pay any super tax.
 Self -employment: The sole trading business offers a large number of person’s
employment in small means.
 Development of personal qualities: In sole trading business, the personal
qualities of a proprietor like self- reliance have full scope for development.
 Disadvantages of Sole Proprietorship
 Burden of unlimited liability: The main disadvantage of sole proprietorship is
the burden of unlimited liability. In case the claims of the creditors against the
business exceeded, then the personal property of the owner is taken to pay
business debts.
 Difficulties if expansion: Sole trading business faces difficulties to expanding
the business in large scale, due to not availability of high resources, because
everything to managed by the owner himself.
 Limited managerial ability: In this type of business, the proprietor has to rely
their own skill and managerial experience, which leads the owner to enable to
perform all the duties and functions of management efficiently, limits the size of
business according to his capacity.
 Lack of continuity: The continuity or performance of a sole proprietorship
sometimes difficult to maintain, due to the owner being dies, sick etc, leads the
business may be closed.
 Loss in absence: If the owner of the business suffers sick very long, cause the
business heavy loss in his absence.
 Absence of specialization: In the absence of specialization in this type of
business, the owner is not in position to get the services of experts like
accountants, salesman’s etc.
 Weak bargaining position: In this type of business both the parties have weak
bargaining position compared to large business.
 Unsuitable for a developing business: In sole trading ship the business grows
up, it is very difficult to owner to meet the requirements of expansion business.

 Experiences:
 It was a good interactive session with the owner of the shop.
 The shop owner was comfortable sharing his work experience and skills.
 He told me the way he deals with his customers, convince them to buy products,
etc.
 He also shared his thoughts on market conditions
 He has also adapted online payment methods like swipe machine, UPI, etc.
2. Interact with any Pvt company owner or
partnership firm or any association of persons and
submit summary report as above in 5000 words.

Name of the Private company: Hexagon

Executive Search
Location: Baner, pune
Nature of business: Recruitment firm
Turnover: around 2-4 cr. Approximately
Contact no:  077760 00080

 Advantages of A Private Company

 Ease of formation: A private company can be formed by two persons only. It

can start its business immediately after incorporation and is not required to wait
for the certificate of commencement of business.
 Greater flexibility: A private company is required to perform lesser legal
formalities as compared to a public company. It enjoys special exemptions and
privileges under the company law. Therefore, there is greater elasticity of
operations in a private company.
 Quick decisions: In a private company there are a lesser number of people to be
consulted. Family members, relatives and close friends form a private company.
They can take prompt decisions.
  Secrecy: A private company is not required to publish its accounts or file several
documents. Therefore, it is in a better position than a public company to
maintain business secrets.
  Continuity of policy: The same persons continue to manage the affairs of a
private company. Relations between them are close and continuity of policy can
be maintained.
  Limited liability: The liability of members in a private company is limited.
  Personal touch: There is greater personal touch with employees and customers
in a private company. There is also greater incentive to work hard and take
initiative in the management of business due to little separation between
ownership and management.

 Disadvantages of a Private Company

 Smaller resources: A private company cannot have more than fifty members. Its
credit standing is lower than that of a public company. Therefore, the financial
and managerial resources of a private company are comparatively limited.
 Lack of transferability of shares: There are restrictions on the transfer of
shares in a private company. As a result a shareholder cannot leave a private
company easily and quickly.
 Poor protection to members: A private company enjoys several exemptions
from various provisions of the Companies Act. Minority members may suffer at
the hands of the majority members. Dissatisfied members cannot cut off their
connection with the company except at a loss.
 No valuation of investment: Shares of a private company are not listed on stock
exchange. There are no regular dealings in these shares. A shareholder cannot,
therefore, know the real value of his investment in a private company.
 Lack of public confidence: Public has little confidence in a private company
because its affairs are unknown and it is not subject to strict control under the
law.

 Experiences:
 I met an employee of the private company he gave me all the details.
 He told me the work they do, challenges they face.
 He told me about the departments they have in the company and their functions
 He also told me how they deal with the employees, customers, investors,
government policies etc.