Chapter 3 - Presentation 3

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<ol><li> 1. Business are divided into four broadcategories, depending on their primary function and the kinds of products that they sell. Manufacturing Wholesaling Retailing Service </li><li> 2. Convert raw materials into goods suitable for useand then sell those goods to others. Two types of Manufacturing Businesses Industrial sold to other manufacturing businesses(metal, plastic parts, lumber, and heavy machinery) Consumer products that are eventually bought by the public. Large manufacturing businesses do not normally sell directly to consumers, they normally use wholesalers. </li><li> 3. Buy goods in large quantities typically frommanufacturers and resell them in smaller batches to retailers. Wholesalers are also know as middlemen, gobetweens, distributors, or intermediaries, because they provide a link. Wholesalers do not generally sell goods to thepublic. </li><li> 4. Buy goods, often from wholesalers and sellthem directly to the public. Retailing stores include traditional stores thatpeople go into to purchase products as well as internet sites. </li><li> 5. In order to sell goods to the public, a retailermust have a resellers permit which allows them to purchase goods tax free from wholesalers. A business that is either a wholesale or retailbusiness is commonly referred to as a trade business. </li><li> 6. Provides services to customers for a fee. Examples include: engineering, legal,medical, accounting, garbage pick up, package delivery, dry cleaning and auto repair. Most states have licensing requirements forservice businesses. </li><li> 7. Farming is a special type of business. It is a combination of retailing and manufacturingwhen goods are produced and sold to the consumers. Mining Often referred to as an extraction business. Mining takes resources from the environment andconverts them to a form that can be sold to manufacturers. </li><li> 8. In the 1950s the dominant industry wasmanufacturing in the United States. During the 1950s and 1960s Americaexperienced a boom in franchising A franchise is an arrangement in which anestablished company sells the rights to a entrepreneur to own an operate that particular type of business. </li><li> 9. By the 1970s, the service industry made upthe dominant force in Americas economic production. According to the U.S. State Department, theservice industry created nearly two-thirds of Americas economic production in 2006. </li><li> 10. By the 1970s, the service industry made upthe dominant force in Americas economic production. According to the U.S. State Department, theservice industry created nearly two-thirds of Americas economic production in 2006.</li></ol>