Lesson 4.01 Types of Businesses

Before we start the lesson, read the definitions for vocabulary words introduced in the lesson.

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Thinking about starting a business? You're not alone. Every year, thousands of Americans catch the entrepreneurial spirit, launching small businesses to sell their products or services. Some businesses thrive; many fail.

Basic Business Structures

Some of the basic types of businesses are sole proprietorships, partnerships and corporations. Each type of business has advantages and disadvantages.

A table showing the basic business structures.

Read Business Structure Basics to learn about the different types of business structures. Pay particular attention to the advantages and disadvantages of each type.

Franchises

Read Why buy a franchise? to learn more about the advantages and disadvantages of franchising.

Cooperatives

Read Cooperative Companies Offer an Alternative to Franchising to learn about the differences between a franchise and a cooperative.

Read New-Age Franchising to learn about how cooperatives offer an attractive alternative to franchising.

Non-profit Organizations

Read The 50 Largest U.S. Charities to learn more about these non-profit organizations. Pick three of the charities that interest you the most and click on their websites to learn more information. Without getting bogged down in the technicalities of tax status, the term charities and not-for-profit tend to be used interchangeably.

The goal of most businesses is to make a profit. While not-for-profit companies are not necessarily looking for a profit, they do try to provide services that people will support with cash donations.

Read 6 Roles and Importance of Profit in Business - Explained! to learn more about the importance of profit to a business.