Chapter Two: Types of Businesses Visions and Ventures

Five Types of Businesses There are five main types of businesses: Resource development Manufacturing Wholesale Retail Service

Resource-development Resource-development businesses gather resources that they find or grow. Examples: *Forestry companies plant trees, harvest trees, or both. *Agricultural businesses plant and harvest crops. They raise livestock to provide products such as meat and milk. *Fishing businesses provide fish for consumers.

Manufacturing Manufacturing businesses are also called manufacturers. They make products. Some manufacturers sell to other businesses. Some manufacturers sell to people. Examples: Manufactured products include furniture, clothing, tools, sports equipment, and vehicles.

Wholesale Wholesale businesses are also called distributors. They buy products from manufacturers. They provide the products to retailers. Examples: A wholesale food company buys products from farmers and sells the products to grocery stores or restaurants.

Wholesale Business A wholesale business rarely sells directly to the public, and it doesn’t manufacture anything. It buys products from manufacturers in bulk and sells smaller quantities to retailers from warehouses.

Retail Retail businesses are also called retailers. They buy products from manufacturers or wholesalers. They sell the products to customers. Example: Most outlets and stores are retail businesses. How many logos do you recognize?

Retail Business Retail businesses sell directly to the consumer. Retailers buy products from wholesaler and sell them directly to the final consumer. Retailers run stores or other selling units that are open to the public. Examples of retail businesses are:

Service Service businesses provide services to customers. Example: Banks, insurance companies, landscapers, and repair businesses are all service businesses.

Service Business A service business provides intangibles such as time, skills, or expertise in exchange for a fee. Retail service businesses sell directly to the end consumer. What are two examples of service businesses? Examples of service businesses are: Hairstylist Swimming or piano lessons Movie theatre Tanning salon

Products and Services Businesses can be product driven or service driven. Resource development businesses, manufacturers, wholesalers, and retailers are product driven. They create products or goods to sell. Service businesses are service driven. Some businesses offer both products and services. For example, some stores provide the service of delivering the products they sell.

Five Categories of Business Resource Development – a business that creates, gathers resources and raw material from the earth to sell. Manufacturing – a business that makes a tangible product. Wholesale – a business that buys products from manufacturers and sells them to retailers. Retail – a business that sells products directly to the final consumer. Service – a business that sells intangibles directly to the final consumer - such as time or expertise.

For-profit Business A business that is run with the goal of making a profit is called a for-profit business. Profit means that a business earns more money from sales than it pays in costs. Making a high profit is usually a sign of a successful business.

Non-profit business Some businesses are created with the goal of helping society. These are called non-profit, or not-for- profit, businesses. Their goal is to help others, not to earn money for the business. If a non-profit business earns a profit, the profit does not go to the owner. The profit is used to help others.

Non-profit business In some ways, non-profit businesses are run the same as for-profit businesses. Non-profit businesses earn money from sales or donations. They have costs that they must pay in order to run the business. Examples: Free The Children, Greenpeace, and the Terry Fox Foundation are non-profit.

Thinking about Volunteering 1. Many non-profit businesses depend on volunteers. Why might a non-profit business need to have workers who are not paid?

Thinking about Volunteering 2. What kind of volunteer work could you do in your community? For example, could you coach a team or help out at a shelter?

Thinking about Volunteering 3. Volunteer work not only helps others. It also benefits volunteers. Many students volunteer at school, such as the upcoming Terry Fox Run. What benefits could you get from doing the volunteer work you described for question 2?

Vocabulary: Product driven: Service driven: Profit: For-profit: Non-profit or not-for-profit:

Vocabulary: Product driven: a business with the main purpose of selling products Service driven: a business with the main purpose of providing services Profit: money earned after all costs are paid For-profit: a business with the purpose of making a profit Non-profit or not-for-profit: a business with the purpose of providing products or services to help people, or a charity.

CSI - Entrepreneur Challenge

CSI - Entrepreneur Challenge Your Objective: Your Investigation: go to www.picapop.com Your Challenge: Find answers for the following: What type of business is this? Does it fall in more than one category? Which city did this business start? When did it start? Did it manufacture anything? What flavours do they make? What do you think happened to the business? Do you think the business is successful? Time to Complete Objective: 24 hours (hand in over network)

End of Chapter Two: Types of Businesses