Whenever we talk about business instantly in our head we think about purchase and sale or trading of some product, this is what business is if we cut and crop the definition of it. But instead of thinking about what business is ever wondered about what are the types of it or how we can distinguish between the businesses, so here we are basically there are 4 types of business that are:
Sole proprietorship - This is the most basic business of all it is something which every wants. As the name tell sole which means single and proprietorship means ownership it means only a single person will be the owner of the business and he will control everything about his business if he wants he can hire some employees under himself to share the work load.
Partnership - This formation happens when two or more individuals form a written agreement of operating the company or business equally. All the partners play equal role while raising a capital but it has some drawbacks as well if one the partners took financial or legal misstep than the whole company has to face the problem that’s why partnership should be proceed with caution.
Corporation - Corporation exists as a single entity. Corporations are given the right to exist by the state that issues their charter. There could only one name to one corporation. Once a year shareholders elect board of directors who meet and discuss affairs from once a month to once a year. They even elect president, secretary and treasurer to conduct daily affairs and they elect it every year.
Limited Liability Company (LLC) - This type of business can be owned by the entities whether an individual, corporations. It is formed under the proper guidelines and paperwork and can be taxed like a partnership, which is an advantage.