Business is a process of not only making profit but also bringing value to society through the provision of goods and services. If you are looking for information about the concept, types and effective business strategies , this article will help you have a more general and detailed view of this field.
I. What is business?
Business is the activity of providing goods and services to satisfy human needs and serve society, with the goal of making profit or not-for-profit. Business organizations, from private enterprises to joint stock companies , all play an important role in economic development. Business people not only create profits but also contribute to building value for the community, from creating jobs to improving the quality of life through products and services.
Business is a core element in any economy. From small startups to multinational corporations, all face opportunities and challenges in the process of development. Today, with the development of technology and digital transformation , online business and traditional business are both exploited to create competitive advantages.
II. Characteristics of business
Responding to human needs and serving society
Business is largely based on identifying and meeting customer needs. A successful business is one that can not only provide quality products or services but also make a difference, serving the best of society's wants and expectations.
Transactions in multiple processes
Before a product reaches the consumer, it must go through many steps such as production, marketing, distribution and sales. Each stage adds value to the product, ensuring that the end consumer receives quality goods.
Exchange of goods/services
Business is the exchange of value between a seller and a buyer. It is the process by which a seller provides goods or services and receives money or equivalent in return.
Business skills
To run a successful business , entrepreneurs need to have a variety of skills, from management skills to business marketing skills, leadership and business financial management . This not only helps to run a business effectively but also helps to develop long-term business strategies.
Sales and profits
The ultimate goal of business is to generate sales and profits . Businesses with stable profits will have enough potential to reinvest, develop and compete in the market.
Seller and Buyer
No business can exist without two basic elements: the seller and the buyer . These are the two main components in every business transaction . Without consumer demand, products or services have no reason to exist.
Uncertain, risky
In business , risks are inevitable. Markets are always changing, from changes in demand to economic crises, causing businesses to face uncertainty. However, this is also an opportunity for businesses to be creative and innovative.
Marketing and distribution of goods
Marketing and distribution activities are important factors that help a business's products or services reach their target customers. Effective business marketing strategies will determine the success of the product in the market.
Connect with production
Business is always associated with production . Producing high quality goods that meet market demand is an important step for long-term business development.
III. Popular types of business today
Service business
Service businesses are those that do not create tangible products but provide services to customers. These businesses operate mainly in areas such as consulting, tourism , health care , or financial services .
Retail business
Retail business is the most common form, where products are distributed directly from the manufacturer to the consumer. This model focuses on selling to individuals and families.
Manufacturing business
Manufacturing business involves creating products and then selling them to retailers, dealers or end consumers. Manufacturing businesses need to invest in technology, equipment and human resources to ensure product quality.
IV. Popular business models
B2B business model
B2B (Business to Business) is a model in which businesses provide products or services to other businesses. This is a form of business that often occurs with large contracts, requiring long-term cooperation and interaction.
B2C business model
B2C (Business to Consumer) is a form of direct sales from businesses to consumers. This is the model that retail stores, supermarkets and e-commerce sites apply to sell products to individual customers.
C2C business model
C2C (Consumer to Consumer) is a model where consumers sell goods directly to other consumers, often through online platforms such as eBay or Shopee . This allows consumers to become providers of services or goods.
C2B Business Model
C2B (Consumer to Business) is the opposite of B2C, consumers provide products or services to businesses. For example, freelancers or professionals provide consulting services to companies.
V. Popular business fields and industries
Retail Business
Retail is the traditional business sector that involves selling products directly to consumers. It is a broad industry, ranging from small grocery stores to large supermarket chains.
Business in Finance
Finance includes banking, insurance, investment funds, and financial consulting services. This is an important industry that plays a role in regulating the economy.
Business in Information Technology
Information technology plays a vital role in the modern economy, from software development companies to cloud services, blockchain , and AI .
Pharmaceutical and healthcare business
The pharmaceutical and healthcare industry is growing, especially after the pandemic. Businesses in this industry focus on providing medical products, medicines, and healthcare services.
Transport business
Transportation is the business of moving goods and services from one place to another. It is an essential area for manufacturing and distribution businesses.
Tourism and Hospitality Business
Tourism and hospitality focuses on providing leisure, travel and entertainment services to customers. It is a thriving industry in countries with diverse cultures and nature.
VI. Types of businesses
Business household
A household business is a small business model, usually run by a family or individual. This form is popular in craft villages and small services.
Private enterprise
A private enterprise is owned by an individual who has the right to make all decisions and is responsible for its assets. This is a flexible model but has many financial risks.
State-owned enterprise
State-owned enterprises are government-owned businesses that typically operate in strategic sectors such as energy, transportation, and public services.
Limited Liability Company
There are two types of LLCs : single-member and multi-member. This is the most common model because the liability of the members is limited to the amount of their capital contribution.
Joint Stock Company
A joint stock company is an enterprise whose charter capital is divided into shares, owned by shareholders. Shareholders can be individuals or organizations, and are only responsible for the company's debts within the scope of the shares they have contributed. This is an ideal model for businesses with ambitions to raise large capital and expand their scale, because the issuance of shares to the public (IPO) allows businesses to access capital from investors.
Partnership
A partnership has at least two partners who conduct business together under a common name and are personally liable for the company's debts. In addition to the general partners, the company may have additional capital contributors, but they do not participate in management and are only liable to the extent of their capital contribution.
VII. Taxes to be paid when doing business
Value Added Tax (VAT)
VAT is a tax levied on the added value of goods and services arising during the production, business and consumption process. The tax rate is usually 10%, however, there are products and services that apply a preferential tax rate of 5% or are tax-free.
Business license fee
Business license fee is a direct tax that businesses or business households must pay annually, based on charter capital or revenue. For businesses with charter capital of over 10 billion VND, the fee is 3 million VND/year; for businesses with charter capital of less than 10 billion, it is 2 million VND/year.
Corporate income tax (CIT)
Corporate income tax is calculated on a company's profits after deducting reasonable expenses. The current tax rate for most businesses in Vietnam is 20%. However, small and medium-sized enterprises may be eligible for preferential tax rates.
Personal income tax (PIT)
For businesses with revenue exceeding VND100 million/year, they must pay personal income tax for the business owner or individuals working at that business, according to the progressive tax schedule. Personal income tax rates usually range from 5% to 35%, depending on income level.
VIII. Violations in business activities
Business without license
One of the most common violations is operating without a license , which is severely punished by law. Violators may be subject to administrative sanctions or confiscation of products and goods.
Not paying taxes as required
Failure to pay taxes on time or to make false tax declarations is a serious violation. Businesses will be subject to financial penalties, and more seriously, they may be prosecuted criminally depending on the severity.
IX. Some notes on business
When doing business , enterprises need to pay attention to the following basic factors to ensure sustainable development:
- Market research : Before you start, analyze the market and clearly identify your target customers, competitors, and industry trends.
- Building a team of employees : Employees are valuable assets of any business. Focus on recruiting, training and retaining talent to ensure sustainable development.
- Monitor and adjust the plan : Every plan needs to be monitored regularly to make timely adjustments to keep up with changes in the market.
- Compliance with legal regulations : Ensure full compliance with tax regulations, business licenses , and laws related to the business sector.
X. Restricted and prohibited business lines in Vietnam
Restricted business lines
Some businesses are restricted or require special licenses to operate, including sensitive products such as weapons, dangerous chemicals, or services such as karaoke and dance clubs.
Prohibited business lines
According to the law, some businesses are completely prohibited, such as drug trafficking, prostitution, trading in obscene cultural products, and trading in military weapons.
Cases where business registration is not required
According to Decree 01/2021/ND-CP, some cases do not need to register for business, including households engaged in agricultural, forestry, and fishery production or small, seasonal businesses that are not on the list of conditional business lines.
XI. Business operations in the digital transformation era
In the era of technology 4.0, digital transformation has become an important factor for businesses to survive and develop. Businesses that are pioneers in applying AI , Big Data , IoT will have a competitive advantage over traditional competitors.
Understanding digital transformation
Digital transformation is not simply about applying technology to business, but also about a comprehensive change in the way of operating, managing and providing services. Businesses need to understand this change to maximize the potential of technology.
Customer Focus
No matter how technology changes, customers remain at the heart of every business. In the digital age, optimizing customer experience through technology tools is essential to retain customers and build loyalty.
Data Analysis
Data is a valuable resource in the digital age. Businesses need to collect, analyze and use data to make smart business decisions, optimize processes and improve performance.
Information Security
With the development of technology, network security has become a big challenge for businesses. Ensuring the safety of customer and business data is not only a responsibility but also a factor in building brand reputation.
Brand Manager – Specializing in Providing Comprehensive Marketing Services for Brands
In the modern business context, brand management and development play an extremely important role in creating differentiation and competition in the market. This is where the role of Brand Manager becomes prominent. A Brand Manager is not simply a person who oversees the image and message of a brand, but is also responsible for building, developing and positioning the brand in the minds of customers.
The Importance of Brand Manager in Business
A successful Brand Manager will have a clear understanding of not only the product but also the value their brand brings to customers. Their job goes beyond managing the brand image and includes:
- Build a brand strategy : Create a brand story, core message and clear positioning in the market.
- Holistic Marketing : From digital marketing , online advertising to social media campaign management , a Brand Manager is the person who ensures that every communication channel conveys a unified message.
- Market research : Understand competitors, target customers and market trends to adjust business strategies accordingly.
- Brand Asset Management : Protect and enhance brand value through maintaining and enhancing brand reputation.
There is no denying that the role of Brand Manager is closely related to business strategy. In an era where customers are increasingly intelligent and demanding in terms of experience, brands must constantly innovate and adapt to maintain their appeal.
Brand Managers ensure that every aspect of the business , from products to customer service, reflects the brand’s values in a consistent and memorable way. They link business management strategy with market needs, ensuring that all marketing activities contribute to building a strong brand.