What Are the Objectives of the Private Sector?
Objectives within the private sector include optimizing profits, reporting financial data with clarity, selecting the proper organizational structure to limit liability and to protect company policies, such as marketing plans, from the competition. Private sector companies are not controlled by the state. According to unemployment rates followed by the United States Bureau of Labor Statistics, the private sector offers the most job opportunities.
A privately held company does not offer stock options or trade shares, and the ownership is generally small. According to an article in the Houston Chronicle, profit development is a shared goal in both the public and private sector. However, in private-sector businesses, the profit goals reward individuals with a monetary investment, usually ownership. Unlike the public sector, many private owners actively participate in the daily management of the company, which results in less conflict between the goals of management and stockholders. Although a privately held company is not required to publicly report financial information, clearness of intention within the ownership is important for accurate decision-making. There are several different ways to structure an organization. Each type benefits and protects the ownership in diverse ways and may take the form of a corporation, a limited liability company, a partnership or a sole proprietorship.