Difference between merchandising, manufacturing & service rendering business Service Business This type of business provides services to its customers, it could be defined as selling your time, or also known as labor business. These type of businesses provide services to private and commercial clients. A few examples of service businesses are: accounting firms, physical therapy offices, handyman companies, a mechanic shop, etc. Merchandise Business This type of business sells physical goods or products to its customers, and the most common types of merchandise businesses are department stores, grocery stores, dealerships, etc. There are also two subcategories under this classification, because a merchandise business can be either a wholesale business or a retail business. The difference between wholesale and retail is that wholesalers buy directly from manufacturers and then they sell the merchandise to retailers, and the retailers buy from wholesalers (sometimes directly from the manufacturing company) and sell to their customers. Manufacturing Business A manufacturing business is in charge of producing the physical goods that they sell to wholesalers or retailers, and sometimes directly to the consumer. Manufacturing companies could be makers of clothing, automobile manufacturers, and other types of factories that involve production.