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in Grade 12 by Master (716k points)

What are the disadvantages of a partnership

Name the disadvantages of a partnership

Analyse the disadvantages of a partnership

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by Master (716k points)
 
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The Disadvantages of Partnerships

  • Partners are jointly and severally liable for all business debts.
  • Wrongful actions of one partner will affect all other partners.
  • Amount of capital that can be invested is limited by partners' savings/creditability.
  • Lacks continuity: If one partner dies/moves away a new partnership agreement has to be  established/a new partnership is formed.
  • Some partners may do more work/spend more time in the business than  others.
  • Partners may not all contribute equally
  • Personalities/Opinions of partners may lead to conflict/disagreement.

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