The term “Business” is used many different ways in our day to day vocabulary. Many people use the word to refer to a company that sells products and/or services. Other people use it to describe an individual who works for a company as a manager, office manager, or employee. And still other people use business to define a set of business activities undertaken by individuals and organizations in order to achieve a certain goal.
In order to understand how businesses can be categorized in this broad spectrum of definitions, it helps to look at the type of entity that makes up a business. A business is defined by an entity as any corporation, partnership, joint venture, or association that exists for the passage of time. Businesses may be either for-profit or non-profitable entities. Individuals working in businesses may be self-employed, employed by a business, a group of people who work together for a common purpose, or even governmental agencies that are charged with the responsibility of ensuring a societal need is met.
Smaller businesses may include stores, boutiques, restaurants, personal offices, and other similar enterprises. Larger businesses include skyscrapers, corporate conglomerates, franchises, and international businesses. Many small businesses are owned by one or two individuals, although some large corporations are run by numerous self-employed employees. Many businesses may be operated on a for-profit basis; however, not all businesses are organized as for profit organizations. Many companies that are closely related to a consumer can be classified as cooperatives.
There are two main types of business administration: sole proprietorship and limited liability company. A sole proprietorship is a form of business where the business owners live in their home, although some sole proprietors do conduct business out of their home offices. A limited liability company is a different business structure than sole proprietorships, and the corporation is a different form of business administration than a limited liability company. When a business is incorporated, there is a separate legal entity than exists when a sole proprietorship exists. This separation provides a business owner protection from being personally responsible for the actions of his business.
Every business has their own way of managing their workers and operations. Human resources (HR) tactics are used to recruit, hire, and train employees to do the most efficient job for the business, which also leads to increasing employee productivity and reducing overall labor costs. Business management tactics include the following: reward and punish systems, assigning of shifts, training and development, and communication and coordination. It should be noted that these methods are often used in conjunction with each other. A good business management definition will note that human resources tactics are often used in addition to the previously mentioned business management tactics in order to maximize overall performance, employee productivity, and business profits.
All businesses need marketing or promotion to be successful. Marketing is the process of creating new business by enticing customers into the business and creating awareness of the business through advertising or public relations. Business management’s definition of marketing will include advertising and public relations because it is the process in which businesses attract clients or customers to their location through the various forms of marketing available. While this may seem like a complex task, marketing a business can lead to a business owner getting more clients or customers which leads to increased profits for the business. It is important to note that all businesses are different and therefore will deal differently in regards to how they market themselves.