Which business are most suitable for Sole Proprietorship form of organization?

Suitability of Sole Proprietorship:

This form of organization is best-suited to the following types of business.

(a) Small capital requirements:

Business where capital involvement is very small and managerial talent has hardly and effects on performance are best suited to this form of organization. A business must be small indeed to permit the owner to know and the supervise everything.

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(b) Artistic goods and personal attention:

Business which produces artistic of special type of goods and requires personal attention of the proprietor are best suited for this form or organization. Under sole proprietorship, individual skill and talents can bring.

(c) Personal services:


Personal services of professional people such as accountants, solicitors, doctors, architects etc., can be successfully rendered under this system.

(d) Computer services:

Business which requires small machines and demands intelligent handling such as computer service, are best suited to sole proprietorship.

(e) Business requiring cooperation:

Business which requires spirits of co-operation are better managed under sole proprietorship viz., a tailoring shop.

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