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What Is A Company? Types and More

company  The term refers to an society or business entity engaged in commercial, industrial or professional activities. The purpose of a business is to organize some kind of economic production (of goods or services). Businesses can be for-profit or non-profit organizations that fulfill a charitable mission or further a social cause. Companies vary in size and scale, from sole proprietorships to large international corporations.

Business also refers to the efforts and activities of people to produce and sell goods and services for profit.


A company is defined as an organization or company engaged in a commercial, industrial or professional activity.

Companies can be for-profit entities or non-profit organizations.

Corporate forms range from limited liability companies to sole proprietorships, corporations, and partnerships.

Some companies operate as small operations in a single industry, while others are large operations spanning many industries around the world.

Apple and Walmart are two examples of well-known and successful companies.

Types Of Companies

There are many types of business replicas and companies are often active in more than one area at a time. However, to generalize about business categories, the three main types are:

Service, such as restaurants

Manufacturing, such as industrial plants.

Retail, such as clothing stores.

Beyond the type of products or services they offer, companies can also be classified by their size and legal form.

In North US, the North American Industry Classification System (NAICS) sets the standards for which small and medium-sized businesses (SMEs) qualify. Size standards vary by industry. They can be determined by the size of the workforce or by the income level of a business.4

In the US, the IRS helps define the potential structures someone can choose from when defining their business enterprise. Here are the most common corporate structures.


Sole Proprietorships:

These are unincorporated industries that are owned and operated by a single person.

Partnerships –

This occurs when two or more people are involved in the financing, work, ownership, profits, and losses associated with a business enterprise.


These corporations are owned by shareholders and can grow into large corporations.

S Corporations – These corporations are similar to corporations, but are taxed differently: they pass through income, losses, deductions, and other credits to shareholders, who pay taxes at individual tax taxes.

Limited Liability Company (LLC): The rules that rule LLCs vary from national to state. Depending on where you live, LLCs may offer favorable tax treatment or other benefits.

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