Classification of Businesses
Primary, secondary, tertiary sectors
Primary sector
- The primary sector of industry extracts and uses the natural resources of Earth to produce raw materials used by other businesses.
- Examples include:
- farming
- fishing
- mining
- oil extraction
- forestry
Secondary sector
- The secondary sector of industry manufactures goods using the raw materials provided by the primary sector.
- Examples include:
- car manufacturing
- food processing
- computer assembly
- house construction
- chemical refining
Tertiary sector
- The tertiary sector of industry provides services to consumers and the other sectors of industry.
- Examples include:
- transport
- banking
- retail
- insurance
- hotels
Private and public sectors
- A mixed economy has both a private sector and a public sector.
| Feature | Private sector | Public sector |
|---|---|---|
| Ownership | Private individuals, partners, or shareholders | The state, local or central govt. |
| Primary goal | To maximize profit or increase market share | To provide essential services to society |
| Funding | Bank loans, personal savings, or selling shares | Govt. tax revenues (income tax, corporate tax) |
| Examples | Local grocery shops, Apple, Nike, private clinics | State schools, public hospitals, police, military forces |