What Is Business?
A business can be described as an organization or enterprising entity that engages in professional, commercial or industrial activities. There can be different types of businesses depending on various factors. Some are for-profit, while some are non-profit. Similarly, their ownership also makes them different from each other. For instance, there are sole proprietorships, partnerships, corporations, and more. Business is also the efforts and activities of a person who is producing goods or offering services with the intent to sell them for profit.
Business Definition
Business refers to an enterprising entity or organization that carries out professional activities. They can be commercial, industrial, or others. For-profit business entities do business to earn a profit, while non-profit ones do it for a charitable mission. Business ownership includes partnerships, sole proprietorships, corporations, etc. Businesses can be small-scale or large-scale. Some of the biggest businesses in the world are Amazon and Walmart.
Types of Businesses
Various businesses are organized per some type of hierarchy or bureaucracy. In these businesses, the positions have a customary role and responsibility.
As per business definition, we see that different types of businesses are:
Sole Proprietorship: In this kind of business, a single person owns and operates the business. There isn’t any kind of legal separation between the owner and business. Thus, the onus of legal plus tax liability is on the owner.
Partnership: As the name suggests, it is a business where two or more people run it together. The partners bring in resources and money, and then the shares in the profit or loss are divided amongst them.
Corporation: In this business, a group of individuals act together as a single entity. The owners in this business are called shareholders. They discuss their views on the common stock of the corporation. There are unfavourable taxation rules in a corporation for the business owners.
Limited Liability Company (LLC): It is not as old as the other business structures. It merges a partnership’s pass-through taxation benefits and a corporation’s limited liability benefits.
Different Sizes of Business
Small Business: There are different sizes of business. Small businesses are companies where small owners (an individual or a small group) operate. For instance, family restaurants, clothing companies, home-based companies, and publishing companies. In this type of business, the profits are not that high but just enough to continue the business operations.
Mid-sized Business: These businesses rake in millions of dollars in revenue. Usually, it ranges from $50 million to $1 billion. They are established better than a small business. The employee base of these businesses ranges from 100 to 999 people. For instance, Colorbar Cosmetics is a mid-sized business.
Large Business: This kind of business usually operates as a corporation. It has an employee base of 1000+ people, and its revenue production is more than $1 billion. Usually, these businesses issue corporate stock to finance their operations. Thus, it is publicly traded. As a result, it must report on certain things and operate restrictions. This is the opposite of a small business, where operations are independent of regulators. Amazon and Walmart are examples of large businesses.
Business Industries
There are different industries in which businesses operate. A certain company can define its business by the particular industry. For instance, there are industries of real estate, agriculture, advertising, banking, and more in which businesses exist.
It is because often, the term ‘business’ interchanges with the daily operations and the total formation of the company. We often use this term for indicating transactions concerning an underlying service or product.
Examples of Businesses
Different businesses in the world offer a variety of services and products.
The most successful ones include:
Amazon: The largest online retailer, Amazon sells a wide variety of products on its ecommerce platform. It began as an online bookseller and captured almost every category of retail. It also offers cloud computing services, movie and show streaming platforms and subscription products.
Apple: It is a renowned company famous for its innovative electronic products. They sell personal computers, smartphones, earphones, watches, and laptops. Similarly, they also provide various services like music and video streaming and production services.
Walmart: Being of the most successful retailers globally, Walmart is a multinational corporation that runs a chain of hypermarkets offering a huge variety of products ranging from family apparel to housewares. It is present in 24+ countries and has millions of employees worldwide.
What to do before starting a business?
One needs to take various steps before starting a business. One must conduct market research first and then develop a business plan. The next step must be to seek capital or other funding and select a location and business structure. It is also important to pick the right name, complete the registration process, and get the tax documents and essential permits. A bank account is a must before starting a business.