Kinds of Business

A business object is an organization that uses the economic income to offer goods or services to customers in exchange for currency or other goods and services. Business organizations originate in different types and different forms of ownership.

3 Types Of Companies

The three main types of companies (in terms of the product offered) are:

1. Service Business

A service company provides intangible products (products without physical form). Because service companies offer skills, labor, experience, and other similar jobs for fees or talent. Examples of service companies are:

Business services include accounting, consulting, tax, advertising, engineering, law, research activities and computer programming, etc.

Personal services such as laundry and beauty salon

Car repair, car rental, car wash and parking

Gyms, amusement parks, bowling alleys, golf courses and theatres

Hospitals and clinics, schools, museums and banks

Hotel and accommodation and more.

2. Marketing

This type of business buys harvests at a wholesale price and resells them at a retail price. Because they will recognize as “buy and sell” or “dealer” deals. So they profit by selling their products at prices higher than their acquisition cost.

A merchandising company buys a product and resells it without changing its form. Examples are retail and distribution stores: department stores, grocery stores, hardware stores, clothing and accessories stores, electronics stores, home textiles, hardware stores, household appliances and pharmacies, etc.

3. Manufacturing Company

Unlike a trading company, a manufacturing company buys products as raw materials to create a new product. Because, a conversion of the purchased products.

A manufacturing company combines raw materials, labour, and overhead in its production process. So the goods after the production to customers. Examples include:

Food processing, such because the manufacture of canned meats, frozen foods, dairy products, bottled beverages, and bakeries and oil mills

Cloth factories and textile production from cotton, wool, polyester; and also garment factories that use textiles as raw material

Wood and metal processing, e.g. B. when building cupboards, tables and chairs

Oil refineries, chemical labs, plastic and rubber manufacturing

Shipbuilders, aircraft builders and automobile manufacturers

and many other manufacturers and factories

More than a ranking

Many companies are involved in more than one type of activity, but separated by different divisions or divisions.

For example, consider a technology company that makes phones (Manufacturing), and sell them through its distribution center’s (Marketing), and provides repair and maintenance (Service). so a restaurant combines ingredients to prepare a meal (production), and sells a cold bottle of beer (merchandising), and provides a place to eat (service).

Forms Of Business Organizations

Here are the primary forms of entrepreneurship:

1. Sole Proprietorship

A sole proprietorship is a company kept by one person. So it’s easy to set up and the cheapest of all forms of ownership. But the owner has unlimited liability; That means the company’s creditors can pursue the owner’s assets if the company cannot pay them. Because small businesses usually accept the sole proprietorship firm.

Advantages Of The Sole Proprietorship:

easy to configure

The owner has complete switch over business decisions

Disadvantages Of The Sole Proprietorship:

without a separate legal personality, the owner is responsible for the debts of the company

limited source of funding