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A business is an activity, occupation, system, or method whose purpose is to obtain an economic benefit, generally through the performance of activities to produce products, commercialize products or provide services, which benefit people or other businesses.
In this case, examples of a business are a web page where free information is provided and income is generated through the placement of advertisements, the purchase of a house, and its subsequent rent, and the purchase of clothes in a market wholesaler, and its subsequent sale in a clothing store.
But also, a business is an entity created to obtain an economic benefit, generally, through the realization of activities of production of products, commercialization of products, or provision of services, those benefit people or other businesses.
In this case, examples of a business are an automobile factory (business dedicated to the production of products), an auto parts store (business dedicated to the marketing of products), and an auto mechanic workshop (business dedicated to the provision of services).
Difference between a business and a company
The difference between a business and a company is that a company is also an entity created to obtain an economic benefit, generally through the performance of activities of production of products, commercialization of products, or provision of services, which benefit people or other companies; but not an activity, occupation, system or method that aims to obtain an economic benefit.
That is, although sometimes the term business is used only when it is a small company such as a clothing store, a restaurant, or a garment workshop, and not when it is a large company such as an automobile factory or a telephone company, the truth is that a business and a company are the same if we take into account the second definition we gave of a business.
To better understand the difference between a business and a company, suppose the case of a person who is engaged in buying wholesale clothing in a wholesale market, and then selling it at retail in a clothing store.
In this case, the activity of buying clothes and then selling them is a business, since it is an activity that aims to obtain an economic benefit; while the clothing store is also a business, but also a company since it is an entity created to obtain an economic benefit.
There are different types of businesses since businesses are usually classified according to various criteria, such as their size, their legal form, and their scope of operations; However, the main classification that is usually made to businesses is according to their main activity, which may be:
Extractive businesses are businesses dedicated to the extraction of natural resources, whether renewable or non-renewable.
These businesses are usually medium or large and have various material resources made up especially of the machines and equipment necessary to carry out their extraction activities.
Examples of extractive businesses are agricultural companies, livestock companies, fishing companies, mining companies, logging companies, oil companies, etc.
Producing or manufacturing businesses
Producer or manufacturing businesses are businesses dedicated to the production or manufacture of products; that is, to the transformation of raw materials or inputs into products destined for sale (final products).
These businesses are also usually medium or large and have several material resources made up especially of machines and equipment necessary to carry out their production activities.
Examples of producing businesses are automobile factories, food factories, furniture factories, textile factories, etc.
Retail businesses are businesses dedicated to the purchase of products in quantity, and their subsequent retail sale.
Examples of retail businesses are clothing stores, appliance stores, auto parts stores, hardware stores, warehouses, bazaars, pharmacies, etc.
Wholesale businesses or wholesale businesses are businesses that act as intermediaries between producer businesses and retail businesses.
These businesses buy products in quantity from the former and later sell them, also in quantity, to the latter.
Examples of wholesale businesses are beverage distributors, food distributors, construction materials distributors, etc.
Service businesses are businesses dedicated to providing certain services, either to individuals or to other businesses or companies.
These businesses usually have material resources made up especially of the equipment necessary to provide services, and human resources are made up of workers dedicated to providing them.
Examples of service businesses are restaurants, hotels, beauty salons, gyms, medical centers, law firms, travel agencies, real estate companies, construction companies, banks, schools, consultancies, garment shops, repair shops, etc.
Finally, there are online businesses or Internet businesses, which are businesses that operate or are carried out exclusively through the Internet.
In addition to operating or being carried out through the Internet, other characteristics of these businesses are that they usually have a website and, unlike other types of businesses, they do not usually have a place where they can produce or sell products, or provide services.
Examples of online businesses are websites or blogs that generate income through the placement of advertisements, online stores, affiliate programs, etc.
Requirements for a successful business
To finish this article, let’s see below the requirements that a business must meet to be successful:
Offer a very good quality product
Today, where consumers are increasingly demanding, the main requirement that a business must meet to be successful is to offer a very good quality product.
A very good quality product could imply, among other things, a product that uses or is made of first-rate supplies, that has an attractive design, that is durable over time, and that fully fulfills the functions for which it was created.
Provide excellent customer service
Nowadays, where consumers like to be enriched and have no problem going to the competition if they feel that they have been treated badly, it is useless to offer a very good quality product if it is not accompanied by excellent service.
Providing excellent customer service could imply, among other things, providing a friendly treatment, providing prompt attention, providing personalized treatment whenever possible, having a pleasant environment that makes the customer feel at ease, etc.
Have a differentiation
To stand out from the many competitors that exist in the market today, another requirement that a business must meet to be successful is to have differentiation; that is, with something unique and novel that allows it to distinguish itself from other competing businesses.
A differentiation could be, for example, a product function that other competing products do not have, an extra service that other competing businesses do not offer, a more efficient order-taking or product delivery system, etc.
Finally, today, where the life cycle of products is getting shorter and shorter, for a business to be successful another important requirement that it must meet, is to constantly innovate.
Constant innovation means constantly creating and launching new products (which do not necessarily have to be new, but could also be products that are already available, but with new features); but also to constantly create and apply new production processes, new ways of serving the customer, new promotion strategies, etc.
In summary, a business can be an activity, occupation, system, or method that aims to obtain an economic benefit (for example, the purchase and sale of clothing), but also an entity dedicated to obtaining an economic benefit (for example, a clothing store).
The difference between a business and a company is that a company is also an entity dedicated to obtaining an economic benefit, but not an activity, occupation, system, or method that is intended to do so.
According to their economic activity, businesses can be classified as extractive, producer or manufacturing, retail or retail, wholesale or wholesale, services, and online or on the Internet.
Finally, for a business to be successful, the main requirements it must meet are to offer a very good quality product, provide excellent customer service, have differentiation, and constantly innovate.