HOW START A SMALL AND MEDIUM ENTERPRISE BUSINESS.
Starting a small business enterprise requires discipline and dedication, for you to succeed in small and medium scale business you most have a business plan on ground and a way to maximise profit to meet up with the cost of production. The factor of production in business include land , capital ,labour and entrepreneur the combination of this factor will result in to the optimal growth of a small and medium enterprise business. Small and medium-sized enterprises help large companies in some areas of operation that they are better able to supply. Hence, SMEs are dissolved immediately; the big enterprises will be forced to be involved in more activities, which may not be efficient for these enterprises. Activities such as supplying raw materials and distributing the finished goods created by big enterprises are developed more efficiently by SMEs.
The significance of small and medium-sized enterprises is also recognized by the governments. Hence, they offer regular incentives to SMEs, such as easier access to loans and better tax treatment. This loans and grants help small business to stand on their own and compete favourably among businesses. To meet up with the current reality facing the business world. To start and manage small and medium business you need to include the following;
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Write a business plan, any business plan. You have a passion, and you'd like to make it your profession. ...
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Determine how you'll make a profit. ...
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Start with as much of your own money as possible. ..
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Protect yourself. ...
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Start small. ...
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Get it in writing. ...
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Keep your edge. ...
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Hire the right people.
The attribute used most often is number of employees; small businesses are usually defined as organizations with fewer than 100 employees; midsize enterprises are those organizations with 100 to 999 employees.
Other easy ways to start a small and medium business
Register a business name
When you register your business with the right authorities it helps to give your business an identity and also shows that you are determined and focus. It also give you the advantage of getting loans, from banks, cooperative societies, and even business men who may be willing to invest in your business
Establish a business plan
Starting a small medium scale business will require you having a business plan in your head. This plan will drive your passion to succeed in the business, for business person that fails to plan has already plan to fail.
This is a very important step for any body wanting to start a small and medium businsee.
Create a budget
It will be inefficient not to have a speculative budget for your business. Every business man needs to know the total cost on investments and the expected profit that will be realise at the end of the business period,it could be daily, monthly or annually. Make sure the cost of running the business is aim at profit maximization. Setting a budget for u for seen events and additional miscellaneous will be a good idea and other over head cost.
Determined how your small business will generate income
Profit maximization is the aim of every business that is established. Determine how the model of profit will flow, you will need to study your business cost Eg. Workers wages, material for production, transportation etc.
This will help you determine the expected profit to be realise in the course of running the business.
Invest with your income
It is not advisable to collect loans to start your business because of the risk attach with it, and you will be spending the income that is suppose to be realise before you even have it in your pourse. Many businesses start up capital are gains through loans,and some business spend months and some years trying to pay back those loans making the business stagnant and not growing at the right pace.
In conclusion small and medium scale business are usually created from the scratch as a form of partnership or an individual sole proprietorship. Make sure your business is protected by having an insurance policy in case of liabilities and unforeseen events.
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