Difference between business and profession
Difference between business and profession :Generally, economic activities are divided into three major categories:
But sometimes people get confused when categorizing economic activity as either business or profession. So, let get some clarity regarding the terms- business and profession.
Meaning of Business
Business is either an occupation, profession, or trade, or is a commercial activity which involves providing goods or services in exchange for profits.
Profits in business are not necessarily money. It can be a benefit in any form which is acknowledged by a business entity involved in a business activity.
Forms of Business
There are three main legal forms a business can take:
Each of these legal forms has distinct characteristics as well as advantages and disadvantages.
Objective of the Businesses
The business objective is what makes the business go on and conduct its activities in a long run. It is the reason why the business exists. While most of the people argue that profit making is the core objective of every business. Few have come up with the new underlying objective.
According to the traditional concept, business exists only to earn profits by providing the goods and services to the customers.
According to the modern concept, the underlying objective of every business is customer satisfaction as this is what results in most profits. If the customer is satisfied, business excess.
Meaning of Profession
A profession is a disciplined group of individuals who adhere to ethical standards and who hold themselves out as, and are accepted by the public as possessing special knowledge and skills in a widely recognized body of learning derived from research, education and training at a high level, and who are prepared to apply this knowledge and exercise these skills in the interest of others.
Characteristics of a Profession
There are some following characteristics of Profession are:
- Great responsibility
- Based on specialized and theoretical knowledge
- Ethical constraints
Difference between Business and Profession
The following are some differences between business and profession:
|Basis for difference||Business||Profession|
|Meaning||Business is either an occupation, profession, or trade, or is a commercial activity which involves providing goods or services in exchange for profits.||Profession is a form of economic activities, wherein special skills, knowledge and expertise is required to be applied by the person in his occupation.|
|Basic objective||Earning profit||Rendering services|
|Qualification||No minimum qualification||Specialized knowledge of study is required|
|Transfer of Interest||Possible||Not possible|
|Risk factor||Always present||Not always present|
Advantages of Business
Businesses offer a wide range of advantages to individuals, communities, and the economy as a whole. Here are some key advantages of businesses:
- Economic Growth: Businesses are a major driver of economic growth. They create jobs, stimulate investment, and contribute to the overall expansion of the economy. When businesses thrive, they lead to increased production and consumption, which in turn leads to economic development.
- Job Creation: Businesses are significant employers. They create jobs for a diverse range of individuals with varying skill sets and education levels. Employment opportunities provided by businesses help reduce unemployment rates and improve the standard of living for many people.
- Innovation: Businesses are often at the forefront of innovation. They invest in research and development, leading to the creation of new products, technologies, and services. This innovation not only benefits the company but also society as a whole by improving efficiency and quality of life.
- Wealth Creation: Successful businesses generate profits for their owners and shareholders. This wealth creation allows for personal financial growth and investment in other ventures, including philanthropic activities.
- Tax Revenue: Businesses contribute significantly to government revenues through taxes, including income tax, corporate tax, and sales tax. These revenues fund essential public services such as education, healthcare, and infrastructure development.
- Consumer Choice: Businesses offer a wide variety of products and services, giving consumers choices that suit their preferences and needs. Competition among businesses encourages them to continually improve their offerings, resulting in better quality and lower prices for consumers.
- Efficiency: Businesses are often driven by a profit motive, which incentivizes them to operate efficiently. This efficiency can lead to cost savings, reduced waste, and increased productivity, benefiting both the company and consumers.
- Specialization: Businesses allow individuals to specialize in specific roles and functions. This specialization leads to expertise in various fields, which can lead to higher quality products and services.
- Global Trade: Businesses facilitate international trade by importing and exporting goods and services. This exchange of goods and ideas helps foster global cooperation and economic interdependence.
- Community Development: Businesses can play a vital role in community development by investing in local infrastructure, supporting local charities, and providing employment opportunities. This contributes to the overall well-being of communities.
- Social Mobility: Businesses can offer opportunities for individuals to advance in their careers and improve their socioeconomic status. Hard work, talent, and dedication can lead to upward mobility within a business organization.
- Entrepreneurship: Businesses provide a platform for entrepreneurs to turn their ideas into reality. Entrepreneurship fosters creativity and innovation and can lead to the development of new industries and technologies.
- Consumer Education: Businesses often provide information about their products and services, which helps educate consumers and allows them to make informed decisions.
Advantages of Profession
Professions offer numerous advantages to individuals and society. Here are some key advantages of pursuing a profession:
- Expertise: Professions require specialized knowledge and skills, allowing individuals to become experts in their chosen field.
- Job Security: Many professions offer stable employment and job security, often backed by certifications or licenses.
- Higher Earnings: Professions generally offer higher earning potential compared to jobs that don’t require specialized training.
- Career Advancement: Professions often come with clear pathways for career advancement and growth.
- Professional Recognition: Being part of a profession often brings recognition and respect from peers and the community.
- Impact: Professions often involve work that directly contributes to the well-being of individuals or society, providing a sense of purpose.
- Continual Learning: Many professions require ongoing education and training, promoting lifelong learning.
- Ethical Standards: Professions typically have established ethical codes and standards that guide behavior and decision-making.
- Networking: Professions offer opportunities to build valuable professional networks, which can aid in career development.
- Specialization: Professions allow individuals to specialize in areas of interest, further developing their expertise.
- Global Opportunities: Some professions can offer international opportunities and exposure.
- Contribution to Society: Many professions, such as healthcare and education, directly contribute to the betterment of society.
- Job Satisfaction: Professions often provide a high level of job satisfaction due to the fulfillment of helping others or making a meaningful impact.
After a broad discussion on these two topics, it is quite clear that these two are not same at all. Business is primarily set up to make a profit and acquire wealth, while service is the basic motive of a profession. Further, business requires huge capital investment, at its initial stage. Conversely, the actual capital is the competency and specialization in the profession.