Not For Profit Sector
Not for profit refers to a firm that was established for other reasons and purposes other than to make profit. The activity of the not for profit organization is to champion for a social cause or advocacy for a particular mission. This kind of organizations uses their surplus revenues to achieve their mission and purpose rather than distributing that surplus income to their shareholders as dividends.
The not for profit organizations may face lack of enough resources to carry out their daily activities. This is because all their money is channeled towards achieving the mission and not in profit making ventures. The second major challenge is sustainability. Most of these organizations have short term missions which makes them to collapse as soon as the mission ends. Lastly, engaging and keeping donors is a challenge. Donors are essential to the continuance running of the organization without them the organization would collapse.
Private sector is part of the economy of a nation that is run by individuals and firms rather than the government. The main intention of private firm’s is to make profits and they thrive well in places that the government does not place restrictions in opening and running of businesses. The private business include sole proprietors, trade unions, partnerships, small and medium sized companies, large multinationals, and professional and trade associations.
The challenges faced by the private sectors include lack of finances for operations and expansion, absence of appropriate regulatory structure, rigid labor laws, high taxation, inflation, and cancellation of licenses. The private sector has both internal and external challenges. They can be able to eliminate or reduce the internal challenges but external challenges such as inflation can only be eliminated by the government.
Public sector can be defined as the portion of the economy that is controlled by state or provincial government, national government, or local governments. This sector works to provide services that are essential such as security, street lighting, defense, water and sanitation, electricity, education, health care, roads and infrastructure development.These services are normally financed by the tax that is collected from business people or grants from friendly organization or nations.
The challenges that face the public sector include increase expectation by the citizens, empowerment of citizens, change of workforce, technology, balance of payment deficit, surge in inequality of income, and political instability. The government must put structures and ensure there is political stability for this firm to thrive. Corruption and fraudulent activities is one of the major challenges affecting most governments.