Starting a business

We all dream of owning our own business and have dreams of being successful. For some, the dreams come true with varying degrees of success. Others have tried and failed. But for many, owning a successful business remains a dream.

Whatever the reasons are for starting up or buying a business, one must bear in mind that, apart from such external factors as economic climate and location, there are other factors which play a vital role in the degree of success achievable.  For example:

*    Adequate capital to avoid a crippling debt burden

*    Positive attitude towards business demands and relationships

*    Knowledge and understanding of sound business management practices

*    Administrative experience to put these practices into operation

The underlying principle is that the knowledge, understanding and application of sound business management practices together with adequate finance are absolute essentials if a business is to be successful and avoid mediocrity or failure.

The first things of concern when setting up or buying a business are to obtain advice on the important components of a business venture, such as finance, and capital expenditure. Other considerations cover marketing, stock control, understanding and dealing with business relationships, such as customers, suppliers and of course the Bank. Eg. Understanding terms like mortgages, charges, guarantees and “all money clauses” which are in all Bank contracts.   This needs to be known and fully understood in terms of the relationships with providers of funds.

If owners do not have their fingers on the financial pulse of their business, it is possible the business could be about to enter or has entered a ‘distress phase’ that could soon lead to failure, without the owner or manager being aware of it.

Then if things get tight they should be made aware as to the mechanisms for control and rehabilitation.  In  other words before deciding to ‘call it a day’ they should seek advice from a specialist and, if so advised, set in place a programme of control and rehabilitation that will depend upon the particular circumstances in which each business finds itself.

Business can be both rewarding and challenging but only for those who are prepared to inform themselves of the various factors which affect a business and to acquire necessary management skills.  A business is dynamic and the learning process is virtually endless.  Once you find that you can learn no more, it is probably time to retire.