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1.03 Classify Businesses

1.03 Classify Businesses. Objective 1.03 Classify businesses as profit-making or non profit-making; and service, product or combination. Profit-making Businesses. For-profit businesses Motive is making a profit (earning more revenue than expenses)

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1.03 Classify Businesses

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  1. 1.03 Classify Businesses Objective 1.03 Classify businesses as profit-making or non profit-making; and service, product or combination.

  2. Profit-making Businesses • For-profit businesses • Motive is making a profit (earning more revenue than expenses) • Produce and distribute goods and services based on consumer demand for wants • Examples • Apple Computer • Sony • Domino’s Pizza • The Gap • Abercrombie and Fitch

  3. Non Profit-making Businesses • Non-profit businesses • Can earn a profit, but cannot be run for the sole purpose of earning a profit; profits must be used to benefit the purpose of the organization • Cannot be run for the financial gain of the members or directors • Donors’ Contributions are tax deductible • Examples • American Red Cross • Salvation Army • Meals on Wheels • Homeless Shelters • St. Jude’s Children’s Hospital

  4. Service Businesses • Provide services rather than goods • Some service businesses meet needs (medical clinics, law firms) • Some service businesses provide wants (taxi companies, ISPs) • Examples • Barber shop • Dry Cleaners • Copy and Print Shops (Kinko’s) • Car repair shops

  5. Product Businesses • Sell goods to consumers and other businesses • Retailers and distributors are product businesses • Examples • Old Navy • CD Stores • Best Buy • Dick’s Sporting Goods

  6. Combination Product and Service • Some businesses are both product and service businesses—they sell a product and provide a service. • Examples • Automobile dealerships • Hair salons • Appliance stores • Can you think of others?

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