Provides services to customers

Buys and sells products to customers

Converts raw materials using labor, tools, and processing machines to produce finished goods or products for other manufacturer’s use or for the consumer’s consumption.

The fourth type of Business Operation that offers manufacturing, merchandising and services

Is Owned by a single individual called proprietor.

Is run by two or more individuals who join together.

Is owned by shareholders. It is structured as a separate

legal entity under the operation of law.

Uses another company’s successful business model

to create a shop, restaurant, etc.

Advantages:

- cheap to organize

- easy to start and operate

Disadvantages:

- resources limited to a single owner

- risks, liabilities, and decision-making assumed to the owner

Advantages:

- ownership by a group of individuals

- shared responsibility for any profits,

debts and decisions related to the business

Disadvantages:

- harder and more expensive to organize

- needs more financial, workforce,

and managerial resources

Advantages:

- ownership divided into shares of stock

- management or decision-making

shared by board of directors

Disadvantages:

- more expenses involved

- more rules and regulations to comply with