Advantages and Disadvantages

1. A sole trader or a small business may be able to borrow money from family or friends.
Advantage: When you borow from the family you are not tied up by any terms. Moreover, you do not pay any interests, mostly. So it’s a safe way how to get money without risk of losing the roof under your head.
Disadvantage:The relationships in the family can suffer by your immature behaviour or irresponsible payments. This can lead to many disagreements.

2. Loans from a bank or a building society.
Advantage: Bank can borow you more money than family, for example, and you can get some discounts when starting business or building a house.
Disadvantage:You always have to pay the interest. When you get in some problems you have to deal with it by your own and you can lose everything, all you property.

3. Firms often lease equipment or machinery.
Advantage: When you lease the some items it brings you profit. The machinery or equipment do not have to lay in the warehouse, because they become obsolete and lose their value.
Disadvantage:In the moment of need you can not assure that you will have everything that you need.

4. Grants from central or local government.
Advantage:You are not supposed to return the grants until you break the rules. It’s an easy Access how to get “cheap money“.
Disadvantage:In order to get grants you need to make an project and fulfill the conditions.Also, you can not use the Money to another usage. Then you will have to pay them back.