Starting a small scale business can be a daunting task for newbies. This post will provide you with the key things to note when starting a small scale business.
SME or small business is described as the engine for rapid growth due to its numerous benefits such as employment generation and contribution to the GDP of a country. Sadly, this sector with all the benefits is faced with numerous and endless challenges such as poor management practices, lack of information and knowledge of the market, high cost of overhead, infrastructural inadequacy etc.
The foundation and planning stage in starting a small scale business, plays a very significant role in determining the survival of the business. If you did not plan your business well it will fail. Therefore, planning is a key. The good knowledge of the business, its environment in terms of product, service, market, competitor, location, how to produce it, who to produce for, how to sell it and the consumers must be carefully looked into before venturing into the business.
Things To Note When Starting A Small Scale Business
1. Choose the Business
It is very important to choose the type of business before you start as there are a lot of business opportunities out there. Before venturing into a small business, you have to look at it critically so that you make the wrong choice.
It is very easy to start a small business because it does not require a large budget and skill. But it is the most difficult and frustrating business because of the profit margin. Therefore, choosing the right business is very key. It is very important to consider the demand for the type of business you want to start, the location and the customer. Make your product unique, be innovative and fix the problem in that business cycle, distinguish your business from others.
2. Choose Your Business Location
Choose a location that can be easily accessed by your customers as it will serve as a good-will. Your business location is very key to your business operations and growth.
When choosing your business location, you must consider company needs, customers, employees and equipment needed to complete the services you want to render. The location of a business can affect many aspects of your business operations.
3. Prepare a Business Plan
The business plan helps you to properly shape your business. If you cannot prepare a business plan, get an expert in that field to prepare it for you as it will guide you on all areas of your business. It will also help you if you want to secure a loan as the bank or lender will need it to evaluate your business.
4. Get the Capital
Capital is among the most important things that contribute to the success of a business. Capital is very key when starting a small business because it will serve as the lifeblood of the business.
When you are planning to start your business, make plans to cover all your expenses and make plans for up front expenses in case the profit did not start coming as expected. Take proper accounting record of income and expenses.
5. Advertise Your Business
Advertising provides basic information of your business; it increases sales as potential customers get to know your product and services. Advertising is also a key thing to note when starting a small scale business as it helps both offline and online to bring the much needed traffic to your business.
It helps to inform customers of your offer; it changes people’s perception of your business and makes you stand out from your competitor. Advertising creates awareness for your business and makes it a first choice for your customers.