Disadvantages of Partnership:

i. Disagreement: Partnership entails coming together of several people with different business ambitions, it is therefore difficult to arrive at decisions and maintain perfect understanding among partners, especially in the distribution of profits and losses.

ii. Unlimited Liability: In the event of business failure, partners may loose not only their contributed capital in the business but also their personal properties depending on the extent of liabilities

iii. Transfer of Shares: Members cannot transfer their shares without the authority of the others.

iv. Difficult to enter: Prospective entrants may find it difficult to do so because each partner must agree before the new partner is admitted. This may prevent dynamic persons from becoming a partner.

v. Limited Capital: in partnership capital raised may still be inadequate due to the limited number of partners. It may be higher as compared with sole proprietorship but lower as compared with corporations.