How to Start Your Own Business - Assignment Example

Module How to Start Your Own Business Starting a business in many instances is difficult but the effort is rewarding. Being in business is a career by itself just as people head to an office in a bank or an insurance company. The big distinction comes where one is their own boss and is required to devote a great deal of their time in ensuring that their business gets to its feet while reaping a direct reward from it (Green 46). Opinions have been given for many years on how to start and run a business but there are key underlying issues that are almost certain to lead to a successful start up. People in their thousands venture into business yearly while using different approaches, products and services but a business start up of any kind follows four basic rules or guides to ensure a firm foundation. Starting a business requires one to have an idea and a plan, determine financial requirements that fit their marketing plan, infrastructure for start up and identify a competitive strategy. Idea and a Plan. For one to start a business they must have an idea of what they wish to deal in. This is the product or service of their interest and that which they see prospects in. The product or service need not to be new but can be a modification of an existing one or using more efficient means of production and delivery. The current competitive world is forcing entrepreneurs to develop value-addition strategies in order to enter into a market and thrive. This is an era where discoveries are less and what is left is the improvement on quality and efficiency of a product or service. This is in other words referred to as value addition. Businesses are now competing in a relatively higher playing ground where quality and value of a product or service have surpassed quantity or the basic product appeal. After having an intact idea, a plan comes in handy. The plan highlights the actual product or service, production cost and size of the market. A comprehensive plan should also outline the entry requirements and various barriers e.g. taxation, competitors and regulations among others (Fertik 2010). Financial Requirements and Marketing Plan. In the aforementioned plan financing options and obligations are highlighted. It is now the onus of the to-be business owner to develop financing sources e.g. personal financing, loan, credit cards etc. Since there is a budgeting plan in the main plan it is here that one considers what they should take from the business as a salary to support themselves. This is a crucial stage as decisions made at this point have far reaching consequences even after the business is up and running. A good financing option that will not drain the business’ earnings e.g. self financing should be sought. Businesses require customers in order to sell their products and services. Business Link states that a marketing plan is essential where the owner is to identify their target market and devise ways of making them aware of their product/service and have convincing power to ensure sales. In making these efforts the competitive force should be considered. This is where promotional strategies like advertising in the media and the internet come into play and finances should be set aside for that. Infrastructure for Start Up. Infrastructure in this context denotes the necessary facilities to carry out the business e.g. an office, factory, machinery, paper work, books of accounts and necessary records among others. Small businesses the world over keep no records and if they do, they are rarely satisfactory to enhance decision making processes. This means that few small businesses realize it when they make a profit or loss as actual records are unavailable to track daily performance. This therefore calls for them to have the books of accounts and a proper recording system that enhances accountability. There are many instances where businesses grow and the owners reach a point of sale but lack documentation trailing the business in regards to profitability and customer records over the years (Green 109). Even in times of crisis a business is still worth its customers (who form the most important assets) but when records are few or non-existent then its value declines dramatically. When ample records are in place together with other infrastructural arrangements and profitability prospects the business can start operating. In case the business requires customers prior to start up then this should have been pre-planned unlike a restaurant that requires first opening its doors to get clients. Indentify with a Competitive Strategy. A business needs to develop its SWOT, PEST and Porter’s 5 forces analysis to help in analyzing its competitive strength and its competitive environment (Fertik 2010). Through this the business is able to know its potential, weaknesses, threats and above all the strength of its competitors. This helps a businessman to have a prior set structure that will withstand these internal and external forces. A person starting a business will need to make these several analyses to come up with a competitive advantage. This can be through doing that which is not done or doing it in a better way e.g. higher quality and efficiency as mentioned earlier. Today’s businesses are taking advantage of technology like the internet to advertise themselves, use or credit cards for payment and online shopping. All these depending on the type of businesses can be exploited in coming up with a competitive strategy that will see the business succeed in the highly competitive market environment. CONCLUSION As it has been seen above starting a business cannot be that hard if only one focuses on sustainability strategy even before its start up. Ample preparation is of essence and knowing what exactly one wants to do proves to be paramount. Financing and recording system should also be taken into consideration to ensure that the business remains afloat at all times and in case of anything records will be available to track performance for corrective measures to be taken where and when necessary. Works cited Business Link. Practical Advice For Business: Starting Up. Web. Fertik, Michael. Fifteen hyper-practical tips on starting your own company. Harvard Business Review, 2010. Green, Jim. Starting Your Own Business. How To Books Ltd, 2002. Print. Read More