Starting a new small business is not a bad idea at all, however there are things to consider before you get started. There are different models of business structure to consider. The two main business models this article focuses on are a social enterprise and a regular for profit business, such as a limited liability company.
Your intention or motive of setting it up
To start up a business, all you need do is plan, and have a capital for starting up the business once this is done then you’re good to go. Although there’s a place for passion in business, it has been said that entrepreneurs that go for their passion when business is concerned stand a better chance of excelling in such business.
However, a successful businessman argued that starting up a business does not require much passion, he said. Once you discover people’s needs and provide a solution to a need, then you’ll definitely succeed in such business.
According to him, ‘’you don’t need to like your business, so long you’re doing what the customer wants and making your money you are fine’’ He further said he’s not enthusiastic and passionate about the restaurant business, but he has a restaurant that is bringing him a lot of profit. However, starting up a business requires courage, consistency and credibility.
Are you clear about your motive
The basic reason for starting a business whether big or small is to make profit. Business terms are flexible, you tend to make your own time and sell your products or services at your own pace. A social enterprise oftentimes is not a profit enterprise, it has a social mission to achieve which is usually for the common good i.e providing health care, water among others. The difference between a social enterprise and a business is sustainable revenue. In a Social enterprise profit is not the motive. This does not mean that they do not make a profit, however the profit made is reinvested to create more revenue for the common good and not to be shared by stakeholders.
Passion or area of focus
Many entrepreneurs have a chain of businesses. For example, someone may invest into food business, shelter (real estate) and clothing e.t.c without one affecting the other. However to start up a social enterprise you need to have your goal spelt out and focus on a particular social issue you’re passionate about and can do for free. To start up a social enterprise you need to identify a problem you wish to give a solution. Most social enterprises might choose to focus on health, food, education and so much more. This is not to say that some social enterprise can not have diverse focus, however the primary objective is benefiting the common good. If the primary goal is making profit, start a business instead.
A social enterprise without a clear source of raising funds/revenue is not a social enterprise but a charity. A charity depends on donations to carry out it’s project while a social enterprise sells products and services to sustain their cause. Being passionate about solving a global issue is not enough, but having a stable financing that will help sustain the enterprise. The enterprise will cease to function if you can’t foot the bills however, you need to be honest about your motive
Seek support and advice from a mentor
You need to seek mentorship from those who have crossed similar parts.. You can learn from their experiences. A mentor will help you with a good business strategy that will aide success in business.
Apart from this, you can actualize your business goal when you look up to someone in that particular field, with advice from such a mentor you tend not to make mistakes and grow faster. Partnershipping with organisations with similar objectives is also an added advantage.
Have a defined way of measuring your success and impact
Business and social enterprise need to measure their successes to help them know if they are making progress or not. A business measures its success by the amount of profit made. While a social enterprise measures its progress by the number of impacts and people reached.
Having said this, you need to surround yourself with positive people with great ideas and people in related fields. For a social enterprise, knowing the cost of the project and the number of lives impacted is very important, with this you’ll be able to know the cost of helping a person and this will enable you to grow and increase impact.
10 useful facts about starting a new business
1. Make extensive research about the business you intend to start: this is one of the most important facts one needs to consider before starting a business. Try making an extensive inquiry about the business you intend to venture into. Ask questions from those who have experienced success in the business. Research has shown that having a mastery of the working of a business (good and bad side ) aids in the success of such business.
2. Seek mentorship : research has shown that most of the people that seek mentorship from successful entrepreneurs of a particular business tend to perform wonderfully well in Business.
Who is a business mentor ? A business mentor is someone with more entrepreneurship business experience than you. Someone who excelled in the same line of business with practical testimonies to show for it. A business mentor will advise on how to successfully carry out a particular project using his/her experience as an outline.
3. Understanding the level of your commitment : a wise man once said ‘if you want to start a business, ensure you’re ready to go to bed by 12pm in the night and wake up by 5am in the morning’. The essence of this is that, know your level of commitment when starting a business. Most successful business individuals in the world have asserted that one’s level of commitment determines whether the business will either go far or otherwise.
4. Focus on solving a problem rather than selling a product : it is a fact that the most successful entrepreneurs focused on solving a particular problem in their various communities or societies. A business should be geared towards solving a particular problem. When your business intention solves problems, be sure that such business is on its way to success. Be sure to ask yourself the following question before you start a business : what void will my business fiil ? Is my idea practical ? Can my business create a demand ?
5. Expect and welcome competition: you should expect competition, note that no idea is new on this planet earth. The business idea is practised by thousands of people out there. What will distinguish your business is how you’re able to think out of the ordinary. Most successful individuals in business are the crazy thinkers.
6. Be a minimalist : most successful individuals are minimalists. They use limited resources to achieve a wide range of goals and targets. A lavish spender cannot excel in business. A potentially successful business person must be able to use a stone to kill two or more beds at the same time. For a business to grow , you need to spend less and save more.
7. Invest heavily in the planning stage : developing a workable business plan is a very critical step. The planning stage of a business determines the success of such business. Therefore, it is highly fundamental to invest heavily on the planning stage.
8. Business takes time to grow : you will not immediately become rich! Business takes time to grow with hard work and consistency.
9. Do not use business finance for personal purposes: It is the most common poison to business. Business only grows when it is excluded from personal expenses.
10. Establish a team : you can do it all alone. Establish a support team that might be able to assist in times of emergency or crisis.