CHAPTER 1-TYPE OF BUSINESS

The goods and services provided by businesses make people’s life simpler and easier.

Businesses, which come in different forms of ownership and structure, are created to meet
consumers:

1. Needs

2. Wants, and

3. Demands.

Firms benefit when consumers buy their products and services. They are a vital part of
contemporary civilization

1. Help expand the economy

2. Produce consumer goods and

3. Create job opportunities.

WHAT ARE THE TYPES OF BUSINESS??

1. Service Businesses - A type of business that delivers intangible products to its clients is
called a service business.

This offers professional skills, expertise, skilled labor, and other essential assistance. Examples
are accounting firms, physical therapy clinics, handyman services, mechanic shops, delivery
services, transportation, and customer assistance.

2. Merchandising Businesses Unlike a service business, a merchandising business offers

tangible goods to its customers.

Companies engaged in merchandising purchase completed or nearly completed items from

manufacturers or suppliers to resell them for profit. EXAMPLE: Grocery stores, appliance
centers, drugstores, school supply stores, bookstores, online sellers, and the like are companies
that are engaged in merchandising. They purchase completed or nearly completed items from
manufacturers or suppliers to resell them for profit.
Merchandising businesses belong to two general categories: Wholesale and Retail.

A general merchandise store resells products from suppliers.

1. Wholesalers -are companies that buy directly from the product manufacturers, then sell the
products to retailers.

2. Retailers - mainly purchase items from wholesalers then sell them to their consumers. Other
times, they may buy directly from the product manufacturers

3. Manufacturing Businesses- A manufacturing business is responsible for producing tangible

commodities from raw 3 materials, labor, and machines. Manufacturing companies operate
factories to mass-produce goods and sell them to wholesalers, retailers, and occasionally to
consumers 4 directly.
 Commodities — (noun) basic goods and services that people need in their daily living.

What are the 4 basic commodities

ARE : metal, energy, livestock and meat, and agricultural.

Mass-produce — (verb) to produce goods in quantity, usually by machinery and through

division of labor

Examples of mass production include the following:

 canned goods.
 over-the-counter drugs.
 household appliances.
KEEP IN MIND:

Business organizations exist to meet the needs, wants, and demands of their customers.
Businesses benefit when consumers buy their goods and avail of their services

. ● Business structures differ based on the degree of ownership, liability, funding sources, and
distribution of profit.

The forms of business organizations are sole proprietorship, partnership, and corporation.

The types of businesses according to activity are service, manufacturing, and merchandising.

V.CASTRO