A sole proprietor is less inclined to take risks in the form of innovation or expansion. Why?

cbse
formsofbusiness

#1

A sole proprietor is less inclined to take risks in the form of innovation or expansion because if his decision goes wrong or unfavourable, it can create a serious financial burden on the owner or loss to the business. As the sole proprietor has unlimited liability; his personal property can be used to cover up such losses.