So if you’re interested in being a business owner, you start at the beginning right? What are the basic types of businesses?
There are three primary types of business and then, of course, there are hybrids. The three primary businesses are:
- Service Business
- Merchandising Business
- Manufacturing Business
Let’s take a look at some quick definitions for each of these types of business.
Service Business: A commercial enterprise that typically provides intangible products such as consulting, teaching, financial services, or manual labor in an expert manner by an individual or team for the benefit of its customers.
Merchandising Business: A commercial enterprise that purchases finished goods and resales them for a profit. These businesses typically buy their products from a variety of domestic and international distributors and market the products at in brick-and-mortar stores or online or both.
Manufacturing Business: A commercial enterprise that converts raw materials, components, or parts into finished goods. A manufacturing business usually, but not always, employs a setup of both human labor and mechanical operations.
Hybrid Business: A commercial enterprise that combines elements of two or more of the three primary business types. A common example of a hybrid business is a restaurant. A typical restaurant might develop recipes and purchase raw ingredients from which it will “manufacture” meals. The same restaurant will likely “merchandise” some prepackaged items, such as bottled soda, beer or wine. Finally, the restaurant will also have employees who “serve” the customers by delivering the meals, drinks and other goods that are offered.
There are obviously a wide range of opportunities and ways to do business within each of these models. If you are looking to start a business you need to examine the requirements for each and assess your goals, interests, resources and skills to determine which kind of business you wish to start.