Question

what is the difference between a for-profit business and a non-profit business

Answer 1

Business involves providing goods and services to people with an aim to make profits from the same. However, there are two types of business for profit businesses and not for profit businesses. The for profit businesses aims to use resources of the society for the purpose of making profit for the shareholders while providing goods and services back to society. Non profit businesses provide goods and services to the society back without the intention to generate profits from them in the longer run.

In not for profit business the sources of revenue are subscription,donation, membership fees etc. while for 'for profit' business the sources of revenue are the sale of goods and services. The seed capital in for profit business is provided by the owners or the partners, while in not for profit business the seed capital comes from donations, government grants etc.

The culture is also going to be different in both these types of organization. In 'for profit' organization, the culture will be about deadline, finishing projects on time and lower cost. While for a 'Non profit organization', the culture depends upon the contribution of individual in the organization, there are no strict deadlines or an aim to reduce cost.