Many think of loads of money when hearing or saying the word business, but one has to be aware that are profitable and nonprofitable businesses. Therefore, understanding what this concept involves is important because it helps you decide whether you are made for this or not.
Once you get acquainted with the notions related to running a business you can be more confident. It doesn’t have to be a “C-Cola” type of business, small businesses can be financially satisfactory as well. If the specific lingo scares you with terms like cash flow, profit/loss statements,debt-to-equity ratio or accounts receivable don’t be fooled. Small/business ownership is not that complicated as it seems. You will be surprised to find out that you are already familiar with some of the meanings. Have you ever been paid for a musical performance, performed services like baby-sitting, lawn-mowing? Then you have been involved in small businesses.
Being a small-business owner gives you the liberty to choose the work program as you think it is best for your business. Some successful small-business owners work 40 hours a week, whereas others work part-time.
A small business can be born out of the blue, when you are sitting under a tree on a hot summer day and thinking about a glass of cold lemonade. The you realize that this could use for some other too and you come up with the idea of selling lemonade. There is no lemonade stand in sight, therefore no competition. An untapped market is an important aspect to start from.
Next, you start asking the neighbors if they’re willing to buy lemonade from you. This way you discover whether the quality, service and location of your projected business are appealing to many or few customers.
Let’s say that the “market research” you have conducted has been positive. A step further is to choose the location of your business. Maybe the street where you live isn’t as crowded as you might want to. To maximize sales you look for a street with enough traffic. You decide to move the stand on the corner down the road, in front of Mrs. X’s house. You convince her to grant you the permission to set up there by offering a free glass of lemonade every day. This “move” represents your first lease and the first experience of bartering.
After all these steps have been completed, you name your business, build your stand, prepare the lemonade and obtain the necessary elements of the “store” (the cash box; a table-the furniture; a pitcher-the fixture. You may want to talk with a friend or your parents to help you with the capital.
These challenges you are about to face when starting a small business are the same that a large company copes with every day. The basics of running the business are the same.