Business

Business

A business (also known as company, enterprise, or firm) is a legally recognized organization designed to provide goods, services, or both to consumers or tertiary business in exchange for money.^[1] Businesses are predominant in capitalist economies, in which most businesses are privately owned and typically formed to earn profit that will increase the wealth of its owners. The owners and operators of private, for-profit businesses have as one of their main objectives the receipt or generation of a financial return in exchange for work and acceptance of risk. Businesses can also be formed not-for-profit or be state-owned.

The etymology of "business" relates to the state of being busy either as an individual or society as a whole, doing commercially viable and profitable work. The term "business" has at least three usages, depending on the scope — the singular usage (above) to mean a particular company or corporation, the generalized usage to refer to a particular market sector, such as "the music business" and compound forms such asagribusiness, or the broadest meaning to include all activity by the community of suppliers of goods and services. However, the exact definition of business, like much else in the philosophy of business, is a matter of debate and complexity of meanings.

Basic forms of ownership

Although forms of business ownership vary by jurisdiction, there are several common forms:

§ Sole proprietorship: A sole proprietorship is a for-profit business owned by one person. The owner may operate on his or her own or may employ others. The owner of the business has unlimited liability for the debts incurred by the business.

§ Partnership: A form of for-profit business owned by two or more people. In most forms of partnerships, each partner has unlimited liability for the debts incurred by the business. There are three typical classifications of partnerships: general partnerships, limited partnerships, and limited liability partnerships.

§ Corporation: Can be either public or private in nature. A public company is often listed on the stock exchange and typically has unlimited liability. Privately owned companies have limited liability and are often signified by the term "Pty Ltd". The relevant jurisdiction normally specifies the rules of incorporation, whether rules are replaceable, who is responsible for making decisions and how the directing mind of the company may be elected. In South Africa private companies can also take the form of being a closed corporation.^[2]. Corporate entities have a legal personality and can enter into transactions and agreements as if they were natural persons.

§ Cooperative: Often referred to as a "co-op", a cooperative is a limited liability entity that can be organized for-profit or not-for-profit. A for-profit cooperative differs from a for-profit corporation in that it has members, as opposed to shareholders, who share decision-making authority. Cooperatives are typically classified as either consumer cooperatives or worker cooperatives. Cooperatives are fundamental to the ideology of economic democracy.

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§ http://en.wikipedia.org/wiki/Business