Company vs Industry
If you hear the name General Motors, what is the image that comes to your mind? Of course, the automobiles made by General Motors as they have become so popular all over the country. Now automobiles are made by many other organizations also as General Motors is a part of an industry that is involved in the manufacture of automobiles. It is clear then that it is a part and whole relationship. General Motors is a company that is a part of the automobile industry. However, some people still confuse between the terms company and industry. For such people, here is a brief explanation of the two terms.
Company is a business entity that is a body made up of individuals that are together to further the aims and objectives of the company. A company can take many forms. It is a legal entity that can take many forms such as a corporation, partnership, association, private limited or public limited company depending upon its registration and also its structure. A company is treated as an individual by the law which goes on in perpetuity irrespective of the death or insolvency of the owner. A company comes into existence after registration under the Companies Act, and once incorporated, has to pay taxes just an individual would on his income.
Industry refers to a particular sector of economy that is either involved in manufacture of goods or providing services. An industry is the sum total of all the companies that are involved in one particular activity or a group of activities. For example, Revlon may be a cosmetic company making beauty products, but it is only a part of a huge cosmetic industry which has hundreds of companies manufacturing similar beauty products. Thus any industry is always bigger than a company or a group of companies.
Difference Between Company and Industry
• A company is a legal entity that gets incorporated under the Companies Act and is involved in manufacture and sale of products or services.
• A company is always a part of an industry which comprises many other companies that are involved in manufacture of similar products and services.
• Company is part whereas industry is whole.
• Industry is always bigger than a company.