It is important for you to identify the reason, or reasons, for wanting to set up a business, because this will become your major motivating influence, and will impact on the goals you set for the business, and the risks you are prepared to take order to achieve those goals.
Motivation and enthusiasm are essential ingredients for setting up a business, but because the consequences of failure can be drastic, such a major step should be taken only after considerable thought, discussion, research, and a serious balancing of the advantages and disadvantages offered by a small business enterprise.
Setting up a Business – the benefits and pitfalls
In starting a small business, ultimately you are one who has to ensure that the customers are satisfied and the bills are paid.search, and a serious balancing of the advantages and disadvantages offered by a small business enterprise.
While small businesses may achieve a competitive advantage from lower prices, good quality and design, prompt delivery and courteous service, flexibility in meeting the individual requirements of customers, and good after sales service, they are still likely to experience competition from other small or large businesses in the same locality.
Ownership of a small business means that you are responsible for everything to do with the business, the buck stops with you!
Whether your small business will succeed or fail depends on your abilities, initiatives and capacity to work, and most importantly, on knowing the basics and doing well.
Contrary to perceptions, most businesses survive for a considerable time. For example around two thirds of businesses are still operating after five years and almost 1/3 are still operating after 10 years. About 7.5% of businesses exit each year, and cessations account for 80% of exits, with changes in ownership accounting for the remainder.
Most exits are not the result of firm failures. In fact, less than 0.5% of all businesses exit each year due to bankruptcy or liquidation. The failure rate has fallen significantly in the past decade.
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