Business can be said to be every activities that involve the exchange of money for a product or service.
Business is considered a Current Asset.
According to Robert Kiyosaki of ‘Rich Dad, Poor Dad’, “asset puts money into your pocket”
Yes, you are in business. But What Type Of Business Is Yours?
There are several types of businesses and this post will focus on them.
Types of Businesses
✔SERVICE BUSINESS: In service business, no physical product is sold. Your service is said to be intangible, meaning it can not be seen or touched. This type of business involves selling skills. This is the one I love most.
Barbing business, Taxi business, Tutoring, Dry Cleaning business, etc
✔MERCHANDISING: In this type of business, physical products or goods are sold. The products that are sold can be seen, touched, smelt, and consumed physically.
Trading of any products is merchandising.
The products traded are said to be tangible because you can see or touch it.
Examples: Palm kernel trading, boutique, grocery stores, etc.
✔PRODUCTION BUSINESS (manufacturing and agro): Every business that involves transforming raw materials into a finished goods falls under this category.
Examples: Bakery, plastic industries, furniture making, etc.
✔COMPOSITE BUSINESS: It combines two or three types of businesses. Service, Production, and Merchandising.
Restaurant business is a common example: In a restaurant business; preparing a meal is considered as production, because raw materials are converted into finished edible food. When the “table is served”, it represents the service part. And the selling of soft drinks is considered merchandising.
Another example is timber milling, where timbers are milled and sold as planks. The milling of timber into planks is a form of production, while the selling of the finished goods “planks” is considered merchandising.
The type of business you choose determines to a large extent the capital required, location of the business, manpower, business structures, management structures etc. Making this choice is one of the first thing an entrepreneur needs to do before start-up.
Thanks for being here…✏