Question

Arjun has been successfully managing his small bookstore. However, he falls sick and is unable to continue the business. How does this situation highlight the limitations of sole proprietorship?

Answer 1

Arjun’s inability to continue his bookstore due to illness demonstrates a key limitation of sole proprietorship: lack of continuity. The business heavily depends on the proprietor’s ability to operate, so any personal incapacity directly affects the business operations. This risk shows that sole proprietorships are vulnerable to interruptions because there is no separation between the owner and the business, unlike other business forms, which may maintain continuity even in the owner’s absence.