HOW ARE COMPANIES CLASSIFIED ACCORDING TO THEIR ECONOMIC ACTIVITY IN COLOMBIA?

Ludy Yorlett Moreno   2021-05-06

When forming a company one of the aspects that must be clear is the type of economic activity that is going to be carried out, in order to be able to frame it within the corresponding sector and to be able to prepare an initial sketch of the configuration of the various resources that they will be needed to start it up, as well as to better understand the competition and the market you want to access.

In order to classify companies, three main categories are used: economic activity, profit-making purpose and its legal structure. According to economic activity, companies are divided into service, commercial, and industrial companies.

Service companies: They are those companies that are created with the purpose of providing the client with a service, that is, an intangible activity whose purpose is to satisfy a specific need of an individual, in exchange for a consideration. Some examples of service companies are

  • Internet providers.
  • Law firms.
  • Academies, schools and other educational institutions.
  • Hospitals.
  • Transport companies.

An intangible product is understood to be anyone that does not have a defined shape, but serves to provide the client with an intangible asset that they need. For the client to receive this intangible asset, physical devices or tangible materials are sometimes required, as is the case, for example, with mobile phone companies.

The service offered is the line through which you can communicate with other people, which is immaterial and which can be accessed thanks to the terminal through which the customer makes the call.

Commercial Companies:

They are companies that are dedicated to the purchase and sale of material goods, whether raw materials or finished products, but do not carry out any manufacturing process. Some examples of commercial companies are

  • Electronics stores
  • Libraries
  • Supermarkets
  • Clothing, shoe and accessories stores
  • Toy shops
  • Dealerships and stores for buying and selling used vehicles.

These companies can be wholesalers or retailers. In the case of wholesalers, these are traders who sell their goods wholesale, that is, in large batches. These companies usually supply other commercial companies, or industrial companies when they market products that will later undergo a manufacturing process.

Retail companies are also known as retailers and they sell their products in small quantities, usually to the end user. These businesses usually work with the public, either in physical or virtual stores, where the purchase process is carried out remotely.

Many trading companies work in both sectors, wholesaling and retailing based on their customers.

Industrial Companies: They are those companies that are in charge of the extraction and transformation and manufacture of raw materials. Some examples of industrial companies are

  • Clothing and footwear factories
  • Construction companies.
  • Food industries
  • Electronic equipment assembly plants.

The company industry of the acquisition and subsequent processing of raw materials of any kind, to be able to elaborate a final product; They are located within organized economic activities. 

They strengthen the Colombian economy, forming part of its secondary sector.

The secondary sector of the economy is made up of all the companies or economic activities that involve the transformation of raw material to obtain a final product, also called the industry sector, divided into two sectors

  • Industrial extractive: It is the one that bases its activities on the extraction and exploitation of all types of natural resources (oil, steel, aluminum, electricity, livestock, construction).
  • The transformation sector: It is one that, through industrial processes, modifies (transforms) a material (raw material). These are companies that produce goods and services from raw material processing without involving industrialized processes.

It should be noted that many companies carry out tasks that belong to more than one type of economic activity. There are industrial companies that also sell their finished products, either wholesale or retail.

Also commercial or industrial companies that offer additional services for clients such as repair and maintenance, thus carrying out activities that also belong to the service sector, which is why there are many joint ventures.

This classification covers multiple companies of various kinds, which, working together, make up the business machinery that allows people to provide all the products and services they need in their day-to-day lives.


Contact us to discuss your investment options at this time: Whatsapp +1 954 448 4879, Colombia +57 317 427 8450

 

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