Small business located in the heart of the modern society, affects the lives of the entire population. Few sectors of the economy could function without his endless stream of products and services. And most importantly, its activity initiates inventive and innovative activities: studies show that the main ideas and inventions often come from small than from large enterprises. The creativity of small businesses will contribute to the dissemination of new products and services for consumers.
Of the 19 million businesses in the United States 99% can be attributed to small, i.e., each of them employ fewer than 500 people. About 600 thousand new enterprises are created every year, but half of them terminates its operation within 18 months. The main reason for the high rate of mortality is the ease with which inexperienced people can start new business.
Contrary to popular opinion, small business is thriving in the shadow of big business. One study shows that as a rule, small entities are more profitable than the large processing companies.
The future of small business looks brilliant. More and more men and women will participate in a small business. And they will be more prepared to work mostly due to better education and broad support from society.
Most people would like to do business, but only few do it. Of those who do. Also, few succeed. However, the opportunity to become a successful entrepreneur is very real. The odds favor someone who is committed to hard targets. Such people are also more likely characterized by innovation, take on reasonable risk, confident, hardworking, able to set goals and responsible.
Entrepreneurs appear in any sphere of activity, and each ethnic group can boast of its successful entrepreneurs. In some ethnic groups are usually a higher percentage of entrepreneurs than the other, mainly because of the entrepreneurial opportunities were closed to some groups.
Other social factors also seem to affect entrepreneurial success. Psychologists say that entrepreneurs are more likely to have parents who set high standards of performance of children, contributed to the development of skills for self-reliance and were not proponents of discipline.
The main reward of the entrepreneur is the satisfaction of a job well done, which affects profits. The main risk is business failure that can destroy the personality and to destroy all savings.
Opportunities and trends.
Although a small business is booming in nearly every grown, in some it occupies a stronger position than others. The requirements of each major group of industries, the initial investment in staff, materials and equipment determine how sustainable is the presence in them of small businesses. Judging by the number of employees, a small business prevails in three of the four major groups of industries: wholesale trade, retail trade and the service sector. Less strong is the position in production, mainly because of the big money required to start a business.
Development opportunities of entrepreneurship exist in virtually every industry. In any industry small businesses succeed best when are the innovators. For example, in producing a small business competes in high-tech industries such as manufacture of chemicals and electronics. The service sector due to the ease with which you can start a business attracts many entrepreneurs and is the most rapidly growing part of the economy.
Life in the next century will be dramatically different from today’s life. The rapid growth of knowledge will always create change, and an ever-increasing rate and is mainly due to monitorizarii. Aspiring entrepreneurs must understand the trends in the industries to better prepare for the use of the opportunities in high-, medium-, low -, and low-tech industries.
Search new business.
Future entrepreneurs can do their own business in one of two ways: acquiring an existing company or creating a new venture. But to select one of the ways entrepreneurs need to answer the question: What business should I do? . A reasonable answer will require entrepreneurs careful consideration as its own opportunities and industry trends.
Buying an existing enterprise involves less risk than a new enterprise, because in this case it is possible to evaluate past successes and failures. For example, a buyer can find balance sheets, counting inventory, test equipment and take into account the business habits.
To determine the price of an existing enterprise prospective buyer can use the valuation method of the net profit or the method of valuation of assets. The method of profit measurement is more accurate, targeting a future profit; the assets valuation method considers only the assets, not taking into account their profitability.
For entrepreneurs the creation of a new at the outset is more attractive than the acquisition of a business. They prefer their own product or service, your employees, suppliers, we want to choose the location, etc.
Many entrepreneurs make and how inventors products. Prior to the creation of enterprises, these entrepreneurs must carefully consider patenting their inventions. The patenting process is complex, costly and time-consuming and usually requires the participation of a patent attorney.
Earlier it was considered two ways of entering into your own business – create a enterprise from scratch or acquiring an existing enterprise. The third way is to buy a franchise.
The word franchising (transsilvania) today has several different meanings depending on the industry. Some even call the franchising industry itself, as if it were a product or service. However, the typical franchise is a contract between the seller and the buyer is a contract that allows the buyer (franchisee, the franchisee, franchiser) to sell a product or service of the seller (franchisee, the franchisor.
Franchising plays a significant role in the U.S. economy and may soon become the dominant form of retail trade. He also occupies a prominent place in the services sector and slightly less in production.
Franchising thrives because it combines the incentive of personal ownership with managerial and technical skills of big business. For entrepreneurs, franchising offers a shortcut to growth as they get ready. For franchiser franchising allows rapid expansion. Franchiser grow, allowing entrepreneurs to Finance its growth by selling franchises.
The rapid development of franchising drew both dishonest and honest franchiser. Persons abusing this system usually promise immediate enrichment with little effort, the freedom to be your own boss and a small initial investment.
To franchise entrepreneurs need to thoroughly work on the choice of franchise, following the following order.
The choice of product or service.
Search for likely candidates to purchase the franchise.
Complete information on the activities.
The hiring of a lawyer.
Compare deductibles and selecting the best of them.
The preparation of a business plan.
One of the most important steps in starting a business is writing a business plan young entrepreneur. A business plan allows you to evaluate capabilities, costs. The difficulties and requirements of a man who decided to start their own business, to create the enterprise and to ensure its functioning.
Essentially, a business plan forces the entrepreneur to first build your enterprise on paper. Writing a business plan is of great importance for the entrepreneur, since it forces him to think about what needs to be done; for creditors and investors because it helps them to decide whether to Fund this enterprise.
For the compilation of the business plan the entrepreneur needs to gather information. The plan will be successful or unsuccessful depending on the completeness of the collected enterprise information. But first and foremost, the entrepreneur should obtain information on which depends the preparation for his enterprise operational plans relating to the production, marketing, organizational structure and legal form. Operational plans, in turn, are the basis for the financial plan.
Assistance in the preparation of the business plan can be obtained from accounting firms, banks, local chamber of Commerce and trade associations.
All new businesses need the services of lawyers, and aspiring entrepreneur should not neglect the legal aspects of the business. The entrepreneur should contact an attorney several months before the beginning of the operation of the business, and the choice of a lawyer to collect credible recommendations. The lawyer must have experience with new ventures.
Legal assistance the entrepreneur should be regarded as prevention. The real value of a lawyer is determined by its ability to resolve problems primarily by preventing their occurrence.
One of the first decisions of the entrepreneur is related to the choice of legal form of business. From here, choose whether it is single proprietorship, partnership or Corporation, depends largely on the amount of taxation, the possibility of prosecution, the probability of automatic liquidation with the death of the founder, as well as many financial and management issues.