BASICS OF BUSINESS | TYPES OF BUSINESSES

Too Much 2 Know

23 Jul 201703:52

Summary

TLDRThis video enlightens viewers on the nature of business, defining it as a regular occupation or trade, and an organizational entity providing goods and services. It distinguishes between privately-owned businesses, nonprofits with social causes, and state-owned enterprises. The video categorizes businesses into service, merchandising, and manufacturing types, with examples for clarity. It also touches on hybrid businesses, like restaurants, that can fall into multiple categories. The presenter encourages viewers to share, subscribe, and stay updated for more informative content.

Takeaways

📚 A business, as per the dictionary, is a person's regular occupation for profit or trade.
🏢 In a broader sense, a business is an organizational entity providing goods and services to customers.
💼 Businesses are typically privately owned and operate through markets to exchange goods and services for money or other services.
🌐 Nonprofit organizations are businesses dedicated to social causes, using revenues to further their mission, funded by donations or a few sources.
🏛️ State-owned enterprises (SOEs) are legal entities created by governments to participate in commercial activities on their behalf.
🛠️ Manufacturing businesses combine raw materials, labor, and factory overhead to produce and sell new products.
🛍️ Merchandising businesses buy products wholesale and sell them retail, profiting from the price difference.
💈 Service businesses offer intangible products, such as professional skills, expertise, and advice, like salons, schools, and banks.
🍽️ Hybrid businesses can be classified in more than one business type, such as a restaurant, which manufactures meals, merchandises wine, and provides customer service.
🔔 The video encourages viewers to share, subscribe, and enable notifications for more content.

Q & A

What is the dictionary definition of a business?
-A business is a person's regular occupation engaged in trade or commerce.
How is a business defined in the context of organizational entities?
-A business is an organizational entity involved in the provision of goods and services to customers.
What is the primary purpose of businesses in terms of goods and services?
-Businesses provide goods and services through a market to customers in exchange for money or other services.
Who typically owns businesses and what types of entities are they?
-Businesses are mostly privately owned by non-governmental legal entities, but can also be social nonprofits or state-owned public enterprises.
What is a nonprofit organization and how does it differ from a for-profit business?
-A nonprofit organization pursues a common not-for-profit goal and is dedicated to a social cause, using revenues to further its mission, unlike for-profit businesses that aim to make a profit.
How are public nonprofits and private nonprofits different in terms of financial support?
-Public nonprofits depend on donations from the general public for their finances, while private nonprofits receive financial support from a limited number of sources.
What is a state-owned enterprise (SOE) and what is its purpose?
-An SOE is a legal entity created by the government to participate in commercial activities on its behalf, which can be wholly or partially owned by the government.
What are the three types of businesses mentioned in the script?
-The three types of businesses are service businesses, merchandising businesses, and manufacturing businesses.
What is a service business and what types of products do they offer?
-A service business provides intangible products, such as professional skills, expertise, advice, and similar offerings, without a physical form.
How does a merchandising business operate and make a profit?
-A merchandising business buys products at wholesale prices and sells them at retail prices, making a profit by selling at a higher price than the purchase cost.
What is a manufacturing business and how does it create its products?
-A manufacturing business combines raw materials, labor, and factory overhead to create a new product, which is then sold to customers, including the profits.
Can a business be classified into more than one type? If so, provide an example.
-Yes, a business can be classified into more than one type. For example, a restaurant is a hybrid business as it manufactures meals, merchandizes by selling items like wine, and provides customer service.

Outlines

00:00

📚 Introduction to Business Types

This paragraph introduces the concept of business, defining it as a regular occupation for profit or trade, and as an organizational entity providing goods and services to customers. It explains that businesses are typically privately owned, but can also be social nonprofits or state-owned enterprises with specific objectives. Nonprofits are organizations dedicated to social causes, using their revenues to further their mission, and can be either publicly funded or privately supported. State-owned enterprises (SOEs) are created by the government to participate in commercial activities, and can be wholly or partially government-owned.

Mindmap

Keywords

💡Business

A business, as defined in the script, is an organizational entity that engages in the provision of goods and services to customers. It is a core concept in the video, explaining the essence of what constitutes a business. The script elaborates on different types of businesses, such as privately owned, nonprofit, and state-owned enterprises, showcasing the diversity within the business domain.

💡Nonprofit Organizations

Nonprofit organizations are entities that operate for purposes other than making a profit. They are dedicated to social causes and use any surplus revenues to further their mission. In the script, it's mentioned that these can be either publicly funded through donations or privately funded with financial support from a few sources, highlighting their role in society beyond profit motives.

💡State-Owned Enterprise (SOE)

A State-Owned Enterprise (SOE) is a legal entity created by the government to participate in commercial activities. The script explains that these can be wholly or partially owned by the government, emphasizing the government's role in certain business sectors and the distinction from private businesses.

💡Service Business

A service business provides intangible products, meaning products without a physical form. The script gives examples such as salons, schools, and banks, which offer professional skills, expertise, and advice. This type of business is crucial for understanding the service sector's contribution to the economy.

💡Merchandising

Merchandising, as described in the script, involves buying products at wholesale prices and selling them at retail prices, commonly known as a 'buy and sell' business model. The profit is made by selling the products at a higher price than the purchase cost. This concept is fundamental to understanding retail operations and the distribution of goods.

💡Manufacturing Business

A manufacturing business is involved in the process of creating new products from raw materials. The script explains that it combines raw materials, labor, and factory overhead to produce a final product that is then sold to customers. This keyword is important for understanding the production aspect of businesses and their role in creating tangible goods.

💡Hybrid Businesses

Hybrid businesses are those that can be classified into more than one type of business. The script uses a restaurant as an example, where it combines manufacturing by making meals, merchandising by selling wine, and service by attending to customer needs. This concept highlights the complexity and multifaceted nature of some businesses.

💡Goods and Services

Goods and services are the tangible and intangible offerings that businesses provide to customers. The script discusses how businesses offer these through a market in exchange for money or other services, which is central to the functioning of the business world and the economy.

💡Market

The market, as mentioned in the script, is the platform where businesses provide goods and services to customers. It is a fundamental concept in economics and business, representing the system in which the exchange of goods and services occurs, and it is crucial for understanding how businesses operate within the economy.

💡Legal Entity

A legal entity, as referred to in the script, is an organization that is legally recognized and has rights and responsibilities. Businesses, nonprofits, and state-owned enterprises are all examples of legal entities. This concept is important for understanding the legal framework within which businesses operate.

💡Revenues

Revenues are the income generated by businesses from their operations. The script mentions that nonprofits use revenues to further their mission, while other types of businesses may use revenues for growth or distribution to stakeholders. This keyword is essential for understanding the financial aspect of business operations.

Highlights

A business is defined as a person's regular occupation for profit or trade.

A business is an organizational entity involved in the provision of goods and services to customers.

Businesses are mostly privately owned and operate through a market to customers.

Non-governmental legal entities own businesses, which may also include social nonprofits or state-owned enterprises.

Nonprofit organizations pursue a common not-for-profit goal and are dedicated to a social cause.

Revenues generated by nonprofits are used to further achieve their purpose or mission.

There are public nonprofits funded by donations from the general public and private nonprofits funded by a few sources.

State-owned enterprises (SOEs) are legal entities created by the government to participate in commercial activities.

SOEs can be wholly or partially owned by a government.

Service businesses provide intangible products, such as professional skills, expertise, and advice.

Examples of service businesses include salons, schools, and banks.

Merchandising businesses buy products at wholesale prices and sell them at retail prices for profit.

Manufacturing businesses combine raw materials, labor, and factory overhead to create and sell new products.

Hybrid businesses can be classified in more than one type of business, such as a restaurant.

A restaurant is an example of a hybrid business, combining manufacturing, merchandising, and service.

The video encourages viewers to share, subscribe, and hit the bell for real-time updates.

The video concludes with a thank you note for watching.