1 03 Classify Businesses Objective 1 03 Classify

1. 03 Classify Businesses Objective 1. 03 Classify businesses as profitmaking or non profit-making; and service, product or combination.

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

Non Profit-making Businesses Non-profit businesses n 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 n Cannot be run for the financial gain of the members or directors n Donors’ Contributions are tax deductible n n Examples n n n American Red Cross Salvation Army Meals on Wheels Homeless Shelters St. Jude’s Children’s Hospital

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

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

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