5 of the Most Common Types of Enterprise Businesses

Enterprise businesses are, at their most basic definition, companies focused on regular expansion. These are businesses where growth is essential to their success, as they need to reach greater markets to extend their engagement and brand awareness beyond regional influence.

Has your business planned to expand? Are you interested in starting a business and you have ideas for what it could become? Here are some characteristics to take into account, from what types of business fall under the enterprise umbrella to how those businesses can be developed and manifested.

Four Types of Businesses

1 Manufacturing

Manufacturing businesses take raw materials and utilize them for the creation of new products. These goods produced—from car batteries to high-end furniture—are sold to customers directly, or to merchandising stores for future sale. 

2 Merchandising

If you’ve been to a retail store, these are businesses within the merchandising space—they purchase products from producers and sell them to regular people. Think of grocery stores or a store that specializes in running shoes. Products are not produced in-house; they are bought from elsewhere and sold at a higher price as is.

3 Service

Service-type businesses offer expertise to customers—something that requires a specific skill to be imparted. These can include plumbers, auto repair shops, law firms, cocktail bars, and more.

4 Combination

Often called hybrid businesses, these are companies that are combinations of the previous three business types. For instance, a company may be involved in both manufacturing and merchandising, while another may be involved in both service and merchandising.

Enterprise Business Organizations

When going about starting a business, you need to know what type of enterprise you want to venture into before you begin. At this time, there are a number of common business enterprises within the United States, from corporations to limited liability companies (LLCs). Each business has its advantages and disadvantages, depending on what you’re trying to achieve as a business owner. Choosing the right business truly depends on what your needs are while starting and how you expect your business to grow into an enterprise over time.

Corporations

Considered a legal person by the law, corporations—from the Latin “corpus,” which means “body”—are entities that move about the market with a great deal of power. With the ability to buy and sell property, conduct contracts, and file lawsuits, corporations have many channels of freedom and access. Compared to other enterprise business models, corporations have notable differences that make it stand out, especially when it comes to liabilities and ownership. These include:

  • Corporate owners are protected against corporate debts.
  • Corporations can conduct crimes, and, dependent on the severity, owners and stakeholders may be protected from personal liability—to a degree.
  • The structure of management and ownership is very different from other businesses, too, with ownership vested in corporate shareholders, management resting among the corporation’s board of directors, and company officers dictating corporate operations.

Regarding business efforts, corporations are considered to be the premier enterprise business. Due to their legal placement, they are most fit at creating massive networks able to produce and manage large amounts of capital, often having stock which is owned, bought, sold, and tracked through the stock market. Among business types, corporations are bound to be one with the most interested parties involved in business happenings and operations.

The Sole Proprietorship

Sole proprietorship enterprise businesses are not legal entities like some other business structures; rather, they are defined by a single person who owns and runs a business, and who is responsible for all of the said business’s debts. Simple to create and register, sole proprietorships make it easy to get your business off the ground—with basic licenses in hand, your business can hit the market and begin partaking in transactions.

While a primary disadvantage is that all debts rest on the sole proprietor of the business, the benefits are much the same: The business is solely in the hands of the owner—all decisions, assets, and motives are determined by the proprietor. However, this type of business gives an owner the ability to determine how money will be spent and how partnerships will be dictated, whether through the use of affiliate marketing or the involvement of a trusted marketing agency to help update company branding. 

Partnerships

Partnerships are created when multiple people engage in business. Often formed under “handshake” terms, partnership arrangements are often constructed with the help of an attorney who can designate liability and profit-sharing while signing contracts. 

The primary benefits of such a professional enterprise are that owners can start business ventures with relative ease and without much startup cost. When it comes to taxes, you’re likely to win out in comparison to other businesses: you’ll be taxed more favorably than you would if you were running a smaller business; you do not have to pay the minimum taxes required of LLCs and corporations.

For business partners with vested interests elsewhere, the benefit is that combined networks can be developed into far-reaching partnerships that can manifest into collaborative associations such as affiliate marketing strategies.

Limited Liability Company (LLC)

Now one of the most popular forms of enterprise business organization within the United States, a limited liability company (LLC) is considered to be a hybrid business model, where a corporation’s liability protection combines with the tax treatment of a partnership business to allow for owners to more readily run their business with protection against company debts.

Many new businesses favor the LLC, as its small partnership-style status makes it easier to get off the ground and manage, whether for rules regarding taxation to simplicity through ownership. However, because LLCs are still new in the grand scheme of American enterprise businesses, there are not many legal precedents in place at this time. Furthermore, required annual fees and quarterly filings with the state where the business is located means that more close oversight is required, particularly to ensure that legal misgivings are avoided at all costs.

Professional Company/Professional Limited Liability Company (PC/PLLC)

PCs and PLLCs are not commonly discussed enterprise businesses, solely because they tend to exist on smaller scales. The reason for this comes down to PCs and PLLCs being designated for licensed professional firms, such as doctors, engineers, lawyers, architects, and more. Providing liability protection similar to LLCs and corporations, these businesses can be expanded into enterprise-size businesses. The most common forms of these enterprise businesses include law, architectural, or accountant firms.

Ellen Hollington

Ellen Hollington is a freelance writer who offers to ghostwrite, copywriting, and blogging services. She works closely with B2C and B2B businesses providing digital marketing content that gains social media attention and increases their search engine visibility.