Business is the activity of trading in goods, services and products by an individual or a group of people which aims at making profit through the trade. Plans and models dictate the result of the operation. Consumers are the primary concern of the companies and the entire plan and strategies are centered on the needs of the consumers. Any enterprise needs to be organized in a particular way. There are several ways to choose from and the category of organization will decide the legal aspects and taxation factors on which the company will be based. The categories are made on the basis of ownership. The various types of organizations are given below.
The Various Types of Organizations in Business:
- Corporation: This type of organization keeps the business entity and the owner separate. It also helps in reducing liability. The process becomes complicated as maintenance of taxes, record keeping, accounting and paper work are more difficult to handle. If you do not want potential clients and shareholders, you can opt for corporation. LLC is however better for those who want to start their own companies for the first time.
- LLC: This stands for Limited Liability Company. In this, the personal assets of the owner are protected from liabilities of financial nature. The personal liabilities of the owner are also protected. However, as exception if there is a fraudulent work, the owner is held responsible personally. There are no federal forms of tax for LLCs.
- Sole proprietorship: In this type, the owner is solely responsible for the taxations and other legal aspects. The profit and loss of assets and liabilities are purely the proprietor’s responsibility. It is advised that proprietors should not invest in businesses that have high risk factors. This is because all the assets of the proprietor will be at stake in the project.
- Partnerships: Partnerships take place when one is not able to take the full responsibility of the business. One needs to associate with another proprietor for starting a business. Partnerships need to file information returns with IRS but it is not required of them to file tax returns separately. Types of partnerships include:
-> General
-> LLC
-> LC
Consultants:
This is a professional service that helps various organizations with their specific needs. The consultants provide expert help for specific purposes and are cost effective in nature. Consultancy is essential for all those organizations that aim to reach greater through extensive research and studies related to consumers. This particular field of business is fast growing in today’s world.
Proper planning and strategies help in making profits through the enterprise. However, partnerships make more profit than individual ownerships and the burden is less and team work contributes better ideas for profit making.
Description: To start a business you need to have an idea as to what type of enterprise you want to establish. There are a number of categories of business. Your enterprise will fall into any one of these categories.
Author’s Bio: Myke Thomas is a proficient author who writes quality articles on topics such as Procurement Consultants. He is a vastly experienced author who has been penning thoroughly informative articles for decades. His articles have been very helpful for the readers.