Date Posted: 4/18/2012 2:27:08 AM
Posted By: sashoo Membership Level: Silver Total Points: 382
STARTING A BUSINESS.Starting a business may sometimes represent a better route to ownership than buying one. A start-up can be cheaper, faster and less complicated. Some businesses are easy to start, particularly service businesses. Consulting practices, real estate, sales companies, repair services, small restaurants and professional service practices (accounting, legal, financial, medical service, teaching, etc.) can all be started without substantial difficulty.If you have an exceptional idea or, otherwise, some specific personal advantage, you should examine the alternative of starting a business. Unique ideas spark new businesses. If your idea is unique, then starting a business is the route to follow.A distinctive personal advantage might result from a patent, a location or a ready-made client or customer base. You may possess a one-of-a-kind source of supply or some notable relationships. These unique relationships are often referred to as, “connections or networks”, and they will ostensibly ensure success.THE CLASSIC START-UP PROCESS.The classic process of starting a business involves three items:• An idea.• A plan.• The entrepreneur’s resourcefulness to carry out the plan.1. The Idea:The idea for the new business need not be a new idea, but it does have to be a viable or marketable idea. You need to challenge any new business idea by posing these questions:• Does the idea address a real need or want? Is there, or could there be demand?• Will the demand be large enough to support a business? Is the field open, or crowded with competition?• Can the idea actually be transformed into a business? Is the technology available? If yes, is it appropriate? Appropriate technology has to be available, affordable and suitable.• Do you have the capital it will take to start and, more important, sustain the new business? If not, do you have adequate information on how to access affordable credit facilities?• Do you have the knowledge and skills required to run the type of business you intend to venture into? Has anyone else tried this idea? What was the outcome and why?Answering these questions will take much thought, a lot of research and highly often some institution. Research is a sometimes maligned activity in new business development. Research may occasionally kill a brilliant idea, but it has killed far more destructive ones.2. The Business Plan:A renowned Kenyan entrepreneur, Peter Kanyago, Chairman FedEx, became a licensee of FedEx through his company, East African Courier Ltd. in 1997. In an interview with one 2010 Financial Post Magazine, he cautions that for one to be successful as an entrepreneur, they must have a brilliant idea coupled with a convincing business plan.Formal planning and drawing up a business plan are desirable activities, as they include the following benefits:• Fewer mistakes will be made, and the entrepreneur can take judicious decisions.• The entrepreneur is forced to take all the essential factors concerning the intended enterprise into account, and is therefore less dependent on purely instinctive or crisis-oriented decisions. In this way, stress is avoided.• He or she can take decisions for the future.• The planning stage is an ideal opportunity for testing ideas.3. Entrepreneur’s Resourcefulness to Carry Out the Plan:Entrepreneurs need to possess management skills and use advisers and or experts where necessary. Entrepreneurs know what is needed for success in a specific enterprise, and are keen on developing their skills in these critical areas of performance. This will help determine the success of the enterprise. If entrepreneurs do not have the necessary expertise themselves, they should appoint trained staff. They should be able to understand the environment in which they are competing and are should be well organized.As an entrepreneur, you will usually be aware of, or soon discover, your weaknesses and strengths in terms of the enterprise you are operating or intend to operate. It is logical that you start a business in which you can use your expertise and skills (strengths).
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