Answer:
• Difficulty in obtaining finance
•Unlimited liability risk
• Assuming too many roles
• Heavy decisions making burden
•Going concern
Explanation:
• Difficulty in obtaining finance is one of the many challenges faced by sole proprietors as he seek business expansion. The risk involved in being a sole proprietor is much hence lenders often find it difficult to finance their business.
•Unlimited liability risk is also a challenge against business expansion for a sole proprietor because he faces the risk of loosing his personal assets and that of the business should the business goes bankrupt or liquidate.
• Assuming too many roles poses as challenge to a sole proprietor as he expand his business. In this case, he becomes the manager, customer attendant, cashier etc all of which will become burden on his as the business grows.
• Heavy decisions making burden. A sole proprietor is responsible for making all the decisions regarding his business hence will affect the business as it expands. Some business decisions requires professional advice else the business will collapse in the long run which is often the case with sole proprietors.
• Going concern is an accounting principle which states that a business will continue to exist and into the foreseeable future which is not the case with a sole business owner as his death ends the existence of the business hence a factor against business expansion.
