Small Business Management

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Table of Contents

Where Great Ideas Come From
Services or Products to Sell
Required Resources
How to Compensate Oneself
Business Skills and Experience

In order to start a business, one need to have a business idea, know the product services to sell, have the required resources, know how to pay oneself and have the right skills to run the business. This paper discusses these issues.

Where Great Ideas Come From

One way of obtaining business ideas is by considering areas of talent, or else, areas of skill. For instance, a retired nurse is likely to think of instigating a private hospital. Here, you have to consider your abilities and examine whether people will be willing to pay for services in that area.

Staying informed about current happenings can also enable an individual to come up with business ideas. The minds of those who watch the news frequently with the aim of finding business ideas produces numerous business opportunities.

Keeping up with contemporary happenings can enable one to identify new styles, market tendencies, business news, and at times just novel ideas that have business potential. For example, in Canada same-sex marriages are now authorized. As a result, there are entrepreneurs who are selling visitors travel parcels that contain a marriage ritual to same-sex duos from other nations.

An individual can also come up with a business idea from innovation. The means to finding business ideas for a novel service or product is to spot a market desire that has not been addressed. For instance, 30 years ago there was less desire for anti virus software, internet and desktop computers.

Another way one can come up with a business idea is by adding value to an existing product. The disparity between unrefined wood and refined lumber is an illustration of placing a product through an extra process which augments its value.

The final way of obtaining business ideas is by investigating other markets. A number of business ideas are not appropriate for local use, yet they appeal significantly to alien markets. Investigating about market opportunities that could be present in other societies is an excellent way to find business ideas.

Services or Products to Sell

There are millions of goods and services accessible to consumers at present. At the same time, there are infinite chances for one to go into the marketplace and compete successfully, especially with a novel product or service that has been enhanced in some way than what your rivals are offering. Keep in mind that an individual’s skill at selecting that product or service is vital for your triumph.

The most vital thing one can carry out prior to settling on what to sell is to reflect. The more an individual reflects on a product or service prior to introducing it to market, the healthier his/her decisions will be.

To make a creation flourishing, one must be individually and psychologically dedicated to its success. After one forms a product or service in mind, he/she must analyze the following: if he/she is fond of the product or service he/she is preparing to sell; if he/she would purchase the product and utilize it personally; if he/she can mirror himself/herself selling this product or service for the subsequent ten years.

After that, one can examine the product or service from the clients’ viewpoint: what does the product attain, shun or conserve for the buyer; how does the product enhance a customer’s existence or vocation; the nature of clients one will be selling the product or service to; and if one individually likes the clients who will be acquiring this product or service.

For a product or service to do well, it has to be the exact product which is in the market at the correct time and to the exact customer. It also has to be created and sold by the right corporation, and the right personnel.

Required Resources

Anybody can initiate a business. However, beginning a business that thrives and continues to prosper is more complex than it seems. To begin a business, you have to be well-informed about diverse aspects of business and have diverse skills.

If you lack enough knowledge on accounting to maintain your own books, for example, then you must employ an accountant or a bookkeeper. If your industry is Internet-based, it would be prudent to employ a company to blueprint your website, except if you individually are a specialist in site creation.

Managing personnel is another skill that one must have so as to initiate a successful business. One also needs to be well-informed on sales and marketing. For instance, one need to know his/her rivals, the types of mousetraps that rivals offer and their pricing, and how one’s mousetrap is far much superior. One will also be needed to have the right skills required to spot and contact clients.

In this case, one must also be skilled in business operations. One must have the business knowledge required to fill orders. An individual also needs to consider how he/she will hoard all his/her mousetraps and how he/she will deliver them to the clients.

Finding the suppliers and building relationships with them. Finally, one must have an operating capital to create a business; the sum of money it takes to maintain the business.

Operating capital contains expenditures such as wages, salaries, advertising, supplies, rent, utilities and interest costs. Small business advisors recommend that start-up outlays should consist of no less than operating capital for six months.

How to Compensate Oneself

The measures for reimbursing oneself for hard work in conducting business will rely on the actual business arrangement one selects. The following are topics that often arise when new business vendors solicit from the Internal Revenue Service on paying themselves.

Corporate Officers:

An officer of a corporation does not execute any significant role; hence he/she is not allowed to receive any pay.

Partners:

Partners are not workers and thus are not entitled to definite reimbursements from the partnership.

Dividend Distributions:

Any allotment to shareholders from income and profits is usually a dividend. Nevertheless, a distribution is not a payable dividend if it is a return of investment to the shareholder.

Treating Employees as Nonemployees:

One will be responsible for Medicare taxes, social security and suspended income tax if one does not subtract and keep them because he/she takes care of an employee like a nonemployee.

Draw account:

Assuming one is a partner in a partnership or a sole proprietor, the cash or other types of compensation one takes from his/her company should be justified in a draw account. This will aid one to know the sum of benefits he/she has used from the company throughout the year. Subtracting the sole proprietors’ individual salary or private withdrawals made from the company is not allowed.

Business Skills and Experience

Prior to initiating a business, one must have communication and management skills. Most victorious entrepreneurs have an excellent poise of entrepreneurial and management traits.

One is also supposed to be well positioned to drill other people efficiently, for instance staff and suppliers, in what he/she would like to be completed.

Besides, one should be proficient in managing several business operations including production, sales and marketing, bookkeeping and accounting. Even though, one will not be executing all these tasks, he/she needs to direct all of them.

One should also be well acquainted with financial management. In case one has ever been affirmed bankrupt, this will affect his/her trustworthiness with both suppliers and clients. One must also have adequate money to operate the company, and in case of any troubles, one can hunt for financial guidance.

In order to maintain updates of financial particulars, one will be required to be acquainted with accounting and book keeping.

Lastly, one should be well-informed. An individual is supposed to have information about other companies, especially the companies and economic aspects that will control his/her enterprise. One must also have information about consumer trends, industry trends and the stock market.

In conclusion, there are diverse ways of obtaining business ideas. However, obtaining a brilliant business idea can not make the business excellent. One needs the right mind and skills so as to thrive in a business.

The measures for reimbursing oneself for hard work in conducting business will rely on the actual business arrangement one selects, and most victorious entrepreneurs have an excellent poise of entrepreneurial and management traits.

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