Consideration Before Starting Business and Requisites of Business Success

Consideration Before Starting Business

At this competitive age, many factors are to be considered before starting a new business. A businessman needs to complete some mental exercise and legal documentation. A well-planned business ensures the success in future. The investors (businessman) must be confident that his/her investment decision in new business is his/her good decision. An investor does not want to lose his investment. Hence, a businessman has to consider the following factor before starting a new business.

1. Identification of business
2. Detailed investigation
3. Forms of business
4. Provision of capital
5. Selection of staff
6. Government policy
7. Selection of location of business
8. Office equipment and materials

1. Identification of business:

It is necessary to understand and explain what kind of business is to be started. Here, a businessman must know: what is the nature of the business, what are the products, who are its customers etc. Before selecting a new business a businessman must consider following points:

• Personal knowledge and Interest
• Level of risk
• Availability of resources
• Nature and size of business
• Possibility of futures growth expansion

2. Detailed Investigation and Research:

Once the idea of business is developed, a businessman has to make detail research about his business. He has to build confident regarding the success of business after making research. In this activity, a business man makes the in-depth study of the kind of business he/she is going to start. Generally, the investigation is made on following:

• Availability of resources
• Probable economic growth of business
• Probable change in government policy
• Financial analysis
• Pricing of products

3. Forms of business organization:

There are different forms of business organization like sole proprietorship, partnership firm, joint venture Company, joint stock Company, and multinational company. Depending upon nature and size of business man must select the appropriate form of business. For example a small business can be started individually whereas large size organization can be started in joint stock form.

4. Provision of capital:

Capital is life-blood of any business. It is required for establishment as well as giving continuity of it. Business needs the large sum of money at start up. There is a different source of capital for the new business like; own money we borrowed capital. A businessman must take a decision regarding the easiest and cheapest source of capital before starting a new business.

5. Selection of staffs:

Human resources are most important assets of the business. They are the key source for business success. Depending upon the nature and size of business, different kinds of skilled, semi-skilled and unskilled) .Employs are required. A business man has to develop appropriate system for getting talented and skill employees before starting a new business.

6. Government policy:

The policies of government regarding promotion and control largely affect the success of a business. The government formulates and enacts different rules and regulations for the healthy development of the business. A businessman has to make a detailed study of present business policy, industrial policy, commercial policy and legal procedures before starting a new business. All the business organization has to perform their business within rules and regulations provided by a government.

7. Selection of location of business:

The location of a business is most important factors of success. The location may have its own advantage and disadvantages. Once the location is selected and business is being established, it is very difficult and costly to shift it. Therefore, a businessman selects the appropriate location for his proposed business. For example, location far from the public residence is appropriate for manufacturing company whereas high public dense is required for retails Supermarket Company.

8. Office equipment and materials

The office is the center for all business organization. All the managerial function like planning organizing, leading and controlling are performed in an office. The equipment and materials like a table, chair, phone and the computer should be provided before starting any business. A well-equipped an organized office material helps to perform business activities efficiently and effectively. Therefore, proper arrangement of office equipment and materials is necessary before starting a new business.

Requisites of Business Success

Business has to perform many activities. To become a success in complex environment, business has to consider many factors. A systematic business has to fulfill a basic requirement which ensures the success.

1. Establishment of organization
2. Proper Planning
3. Sound Organization
4. Sound Management
5. Adequate Finance
6. Efficient Marketing System
7. Motivational relation with employees
8. Scope for research
9. Personality of chief

1. Establishment of Organization:

The objective is ultimate goals of an organization. They are the reason for business existence. Therefore, it is necessary to set the objectives in easier and simple language. Without the establishment of objectives, an organization couldn't get its existence.

2. Proper Planning:

Planning is the process of deciding in an advance for what is to be done next. Planning guides and directs the activities of employees towards the achievement of objectives. It defines the complete set of policies, program and methods of completing work. Therefore, it is necessary to formulate appropriate plans to ensure that objectives are achieved.

3. Sound Organization:

Sound organization structure ensures the success of any business. The appropriate decision (distribution) of work responsibility and authority is required for the sound organization. A sound organization also ensures the effective communication from the top level to lower level organization. Therefore, a sound organization structure is required to ensure the success of the business.

4. Sound Management:

Management is the backbone of the organization. To be successful, a business organization needs technically and theoretically managed team. The management of the organization must be effective in all managerial function like planning, organizing, leading, controlling etc.

5. Adequate Finance:

Finance is the lifeblood of any organization. Money is required for establishment of business as well as the giving continuity of business. Business needs initial capital to purchase land, building, furniture etc. whereas business needs working capital to purchase raw materials to pay the salary of staff’s etc.Therefore, the appropriate provision should be made to ensure the business success.

6. Efficient marketing system:

Marketing is a most important activity of a business. It is concerned with informing customers and selling products to them. In modern age, products couldn't be sold without appropriate marketing system. To gain success, a business has to develop most effective marketing system.

7. Motivational relation with employees:

Employees are the most important human assets of the business. To successfully achieve the objective of business, a business has to maintain motivational relation with employees. Employees will not work because of fear and pressure. Therefore, the management must have convincing relation with employees. A motivated worker gives higher performance.

8. Scope for research:

The environmental factors like customer taste, preference, habits, technology, government policies etc. are changing day by day. To understand the changes and adopt the new environmental business, research is most important.

9. Personality of chief:

The chief executive manager is the key person in the organization. The personalities of the chief executive manager are dressing, body structure, the way of communication and the image of business in society. Therefore, for the success of business its chief executives must have the attractive personality.

References:

Khanal, Soma Raj, Surendra Thapa Aslami and Sitaram Dhakal.Business Studies.Kathmandu: Taleju Prakashan, 2067.

Pant, Prem R., et al.Business Studies.Kathmandu: Buddha Academic Publishers and Distributors Pvt. Ltd., 2010.