Types of Businesses

Whether or not you are planning to start a new business, as a businessman, you must have all the necessary information about the types of businesses. This information is valuable to know what type of businesses are popular in the market in your time. Therefore as a businessman, you must not only know about the types of businesses but also which are the most popular. Even if you already own a business, there is still a need for you to have this knowledge regarding the types of businesses that exist and which ones are most popular. Why? This will help you know whether you fall under the popular types of businesses or not.

It will help you make decisions about expanding your own business further or investing in other businesses. If you know the kinds of businesses that are most popular at that time, you will be able to evaluate where your capital should be invested. Other than that, the knowledge of the kinds of businesses is essential to draw a plan for starting one, knowing where to register your business, and things like that. Do not sweat. This article is going to answer all these questions and even more that you might have. There will be a detailed explanation regarding each type of businesses and even some examples to help you understand better. At the end of this article, you will be ready to flaunt your knowledge about the most popular types of businesses in 2019.

Most popular types of businesses in 2019 :

  • Partnership
  • Limited Partnership
  • Corporation
  • Sole proprietorship
  • Nonprofit Organisation

Now that we have a list of the seven most popular types of businesses in 2019 let us study each with great detail. We will break down the elements in each of these types of businesses and evaluate your best option. Let us begin.

Partnership

This is one of the simplest among all the types of businesses to understand. Partnership basically implies that instead of one in charge or head of the business, there are two. The more, the merrier, right? There are huge benefits to this type of business. Say that you do not have enough capital for the initial investment, and you do not want to take any liabilities. A partnership makes a perfect solution for this. The partner will help you reach the capital that you need and become another head or in charge of the business.

There is no way that the partner can be flippant about the business since he has also invested in it. That way, there are two masterminds at work instead of just one. The good and the bad will be shared by both the partners. The weight will not be just on one shoulder but two. Wouldn’t that make it easier for everyone to carry the weight of the business?

Limited Partnership

A limited partnership is a different version of a partnership but in the same types of businesses. The basic elements remain the same, but the hold of both the parties involved in the business is different. The two parties are included, the General Partner and the Limited Partner. While both partners are involved in the investment of the business, both are not involved in the handling of it. Say you want someone to help you gather the investment needed for starting, but you do not want their interference in your working of the business. Then Limited Partnership is the right type of business for you.

The general partner manages the day-to-day workings of the business and also has a personal liability towards it. Limited partner, on the other hand, does not participate in the day to day workings of the company and does not have a personal liability either. It is important to note that every partnership has to be registered. This will help avoid complications and conflicts later on. There is a procedure prescribed that will help you with the legal aspects of any partnership.

See also: Top 10 Key Elements of a Business Plan That You Must Know [2019]

Corporation

A Corporation is among the ideal types of businesses that fits perfectly into the mainstream definition of business. It is an independent body or organization that by many people. This means that a lot of people are shareholders in the business. The company is providing these people with stocks in the business. There is a question here of when a company can be a corporation? If you are a small business company that has just started, it would be wrong to call yourself a corporation.

However, if you are a company that has been functioning as a business for a while now and have several employees, then you can register yourself as a corporation. Again there will follow a legal procedure that will have to follow to obtain permits and licenses, etc.

Sole Proprietorship

A sole proprietorship is the most common among the types of business online. This can equate to the simplicity and ability to create. This type of businesses owners are one person and does not need to go through the tiring process of registration and such.

The determining factor of Sole Proprietorship is that there is no distinction between the business and the business owner. So if your business and you will consider as one entity. You will be accountable for the actions of the business, as well.

Nonprofit Organisation

The name of this type of businesses pretty much explains itself. The aim of this organization is not to earn profits like other businesses. Nonprofit organizations work for social aims such as education or women employment and such. This does not mean that they do earn revenue.

There is revenue generation, but it is employed to pay expenses and the cost of production. If there are any profits that generate, then they are for charitable purposes. These organizations take donations from donors, and in return, the donor can avail of a tax benefit.

Conclusion

These are the five most popular types of businesses in 2019. Now that you know exactly what they are, you can see if your business falls under the popular ones. If you are working on starting something new, this is a rubric that you can follow.

See also: Different Types of Market Research Methods that You Must Know

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